The threat of substitute products or service in coffee industry or for Starbucks is high because there are many substitutes that can satisfy the same needs of consumers available in the market. There are many ways for consumers to choose when they are thirsty. For example, tea, fruit juices, soft drinks, and alcoholic drinks. Besides, in term of coffee beverage, consumers can choose to buy coffee at coffee house or they want to make coffee by themselves at home.
In India, threat of substitute also high because there are many drinking substitutes that satisfy the same need and want in India such as water, tea, lassi, beer, and wine. Moreover, the most popular drinks of Indian consumers are tea, milk and coffee respectively in which they perceived tea as having health benefits.