The main political factor is about sourcing the raw materials. This has gathered a lot of the attention from politicians in the West and from the source countries. For this reason, the company wants to adhere to social and environmental norms. It is willing to follow the sourcing strategies. It gives importance to fair trade practices.
Another impact is the need to follow the laws and regulations in the countries from where Starbucks buys the raw materials. Activism and increased political awareness in developing countries have made his essential.
Impacts of Economic Factors on Starbucks
The ongoing global economic recession is the prime external economic driver for Starbucks. As I already mentioned, this factor dented the profitability of Starbucks. This has convinced buyers to shift to cheaper alternatives. As they did not quit buying coffee, Starbucks should seek an opportunity here.
The company has to deal with rising labor and operational costs. The inflationary environment and falling profitability is causing a lot of stress.
Some other economic factors which can affect Starbucks are:
Local currency exchange rates
Local economic environment in different markets
Taxation level