Expanding Starbucks globally was the key strategy prior to 2008 but as we see an increase in revenue, the profit has slowed down considerably. There needs to be alternatives the company can do to assist global expansion if Starbucks want to commence with this route of strategy.
The biggest issue concerning global expansion is the lack of adaptability Starbucks is practicing in different cultures. The drinks, food, store layout, price, and predictability were strengths for the organization, but now can be considered a weakness. Starbucks fails to adjust themselves according to cultures with the same American taste in drinks and food around the world where it is noticeable that different societies have different tastes and likability. By adapting to the local taste, it should attract more customers and increase profitability.
The layout of the store was a great asset before with people expecting the same everywhere they go, which prevents the foreign substance with traveling. However, the predictability in all stores compounds to a major issue of long waits and slow service as well as the lack of seating within the store. The bottom-line with the long waits can be a turnoff for many potential customers, but by adjusting the stores and adapting to specific layouts, Starbucks can attract the customers who does not like to wait or the ones who just wants to find a place to sit.
Pricing is a sensitive subject to the shareholders but with global expansion, pricing may need to be readjusted since different countries have different standards of living. Possibly by lowering the price in selected regions and countries, it will attract more customers which will offset the initial price cut.
Adjusting price, adapting the food, drinks, and layout are all alternatives Starbucks needs to consider when dealing with the problems and decision to expand the company globally. However, another problem Starbucks has to deal with is how to better the customer service.
The strategy Howard Schultz has implemented on the company in 2008 is not to expand so rapidly, but to concentrate on bettering the company from within and concentrating on customer service. The North America market is still crucial in the success of Starbucks and by improving customer experience and service will increase company profit. There are many ways to improve customer service, but from the weaknesses and threats, we believe that by minimizing crowdedness and long queues, increasing product lines, redesigning the stores, and increase training of staff and baristas are the most suitable methods Starbucks should do to improve customer service.
The long waits and queues in Starbucks is a major sign of a weak customer service that needs to be improved for the company. A way to improve the queues is relative to another alternative we suggested which is to train the staff and baristas better to speed up the service. The staff and baristas can be trained to provide a more personal experience for the customer and also be more efficient in their orders and drink making. Currently, the baristas cannot process orders any faster, but by constructing a more effective way of receiving orders and making the drinks, Starbucks can enhance their customer service aspect.
Redesigning the store is also relevant to enhancing the customer service by giving the Starbucks customer a new look towards the company. The generic Starbucks feel may be blend and dull that is in need of a change to keep up with the times. Improving the design can help Starbucks begin a new start to combat the emerging competitions from McDonalds, Dunkin Donuts, and Peet’s Coffee and Tea.