Types of Strategic Analysis

Discussing Strategic Analysis

Value chain analysis is one such framework. Value chain analysis views a firm as a “chain” or sequential process of value-creating activities. The sum of all of these activities represents the “value” the firm exists to provide its customers. So undertaking an internal analysis that breaks down the firm into these distinct value activities allows for a detailed, interrelated evaluation of a firm’s internal strengths and weaknesses that improves upon what strategists can create using only SWOT analysis. (Pearce, J., Robinson, R. 2016)

Starbucks VCA consist of two chains. The First one ifs the Inbound logistics whick includes the obtaining of raw materials from the suppliers. The focus of Starbucks has been on maintaining excellent relationships with the suppliers. To ensure that it could get a continuous supply of green coffee it has started a number of programs to maintain and manage its supply chain better. Its farmer support centers are a key part of its supply chain management program that provide support to the coffee and tea producing farmers. Also includes roasting the coffee, operation, warehouse and distribution. (Prapta, A, 2017)

The second chain is the Outbound Logistics which entails Starbucks sells its products to the customers via the company stores and its licensed stores mainly. The ready products are shipped to the retail stores from the warehouses and distribution centers where they are displayed and sold. Apart from it Starbucks also uses online channels for selling its products and merchandise.  A limited range of Starbucks products can be found at Walmart and Target stores too. (Prapta, A, 2017)

The resource-based view (RBV) of a firm is another important framework for conducting internal analysis. This approach improves upon SWOT analysis by examining a variety of different yet specific types of resources and capabilities any firm possesses and then evaluating the degree to which they become the basis for sustained competitive advantage based on industry and competitive considerations. In so doing, it provides a disciplined approach to internal analysis.(Pearce, J., Robinson, R. 2016)

Our story began in 1971. Back then we were a roaster and retailer of whole bean and ground coffee, tea and spices with a single store in Seattle’s Pike Place Market. Today, we are privileged to connect with millions of customers every day with exceptional products and more than 24,000 retail stores in 70 countries.  Starbucks went public on June 26, 1992 at a price of $17 per share (or $0.53 per share, adjusted for subsequent stock splits) and closed trading that first day at $21.50 per share .Starbucks was incorporated under the laws of the State of Washington, in Olympia, Washington, on Nov. 4, 1985. Starbucks Corporation's common stock is listed on NASDAQ, under the trading symbol SBUX. (Starbucks)

SWOT is an acronym for the internal Strengths and Weaknesses of a firm, and the environmental Opportunities and Threats facing that firm. SWOT analysis is a technique through which managers create a quick overview of a company’s strategic situation.(Pearce, J., Robinson, R. 2016)

Strength:  "Starbucks is a well-recognized brand throughout much of the world, and likely the most recognizable brand in the coffeehouse business. The Starbucks logo is easily identifiable, and attracts both new and repeat customers. Stores are typically in the most prime locations around the globe, with high traffic and visibility." (Dalavagas, 2016)

Weaknesses:  "Since Starbucks is dependent on consumer discretionary spending, its results are sensitive to changes in macroeconomic conditions. As a result, when the U.S. economy does inevitably begin to slow, softer results on the home front may not be able to be offset by gains in other geographic regions."(Dalavagas, 2016)

Opportunities:  "Starbucks has been branching out from its retail operations in order to boost profitability. Consumer packaged goods, including coffee beans and branded single-serve coffee pods used by home-brewing machines, including K-Cup portion packs used in the popular Green Mountain (GMCR) Keurig machines, offer an exciting opportunity. Starbucks is already the number one premium coffee brand in the K-Cup category, and it hopes to further expand its market share in the coming quarters. Packaged coffee, teas, and ready-to-drink products can leverage the Starbucks brand to add business."(Dalavagas, 2016)

Threats: " The specialty coffee business remains highly competitive with respect to price, quality, service, and convenience. In the U.S., large companies in the quick-service restaurant sector have been increasing efforts to sell high-quality specialty coffee beverages. McDonald’s  has been making a big push into the coffee business in recent quarters, and this could become a big challenge for SBUX. Another major competitor is Dunkin’ Brands Group, which has been in the coffee business for a long time. This company has long had a strong presence in the eastern portion of the U.S, and is expanding in the western part of the country. Starbucks also has competition from smaller, local, mom-and-pop specialty coffee shops around the globe that may offer a more intimate setting. The market for packaged coffee, tea, single-serve packs, and ready-to-drink beverages has been heating up, as well."(Dalavagas, 2016)

References

Pearce, J., Robinson, R. (2016-01-02). Strategic Management, 13th Edition. [Kaplan].

Retrieved from https://kaplan.vitalsource.com/#/books/0077807634/

Prapta, A; (2017). Porte's Value Chain Analysis of Starbucks. Retreived on September 9,2017 from; https://www.cheshnotes.com/2017/02/porters-value-chain-analysis-of-starbucks/

Starbucks Company Profile Retrieved on September 9, 2017 from:

https://www.starbucks.com/about-us/company-information/starbucks-company-profile

  Dalavagas,I, (2016). SWOT Analysis: Starbucks Corp: Retrieved on Septermber 9, 2017 from;

 www.valueline.com/Stocks/Highlights/SWOT_Analysis__Starbucks_Corp_.aspx

Tim's Coffee Shop: Competitive Analysis

Tim's Coffee Shop: Competitive Analysis

After doing some research on the various competitors in the area for Tim’s, this is what I found. There are a couple of Mom and Pop diners, four Dunkin Donuts, and one Aroma Joe’s.

The competition from Dunkin Donuts would be that they have a drive thru, free wi-fi, and a variety of sandwiches. They have hot and cold drinks. You have the option of going in to sit or to go through the drive thru. They also have DDs perks that is a card you use for your purchases to earn points and free merchandise.

Aroma Joe’s has a wide variety of drinks but not a very big food menu. They do not have an inside sit down area. They are a drive thru only, so good for the people on the go.

There are a couple of small diners that serve breakfast and lunch. There is a wide variety of food but the wait may be a little longer as they have to cook the food.

Some of the surveys did not have a choice of rating food but the ones that did said the food was ok/good. Tim should look into expanding his menu. He should add breakfast sandwiches. He should also offer a variety of items for the customers to choose from for their sandwiches. Another item he could add would be muffins. Customers seem to like muffins with their coffee. People like to have choices, it makes them feel as though they have a say in what they are eating. He could add a small glass case for the pastries. Customers like to see the variety of items they have to choose from. Presentation is key to sales.

His business is in a great spot. He is near a college so he has a lot of students for customers. There are a lot of small businesses in the area as well so he gets people going to work and that are on their lunch or coffee breaks. He needs to get some comfortable seating. There are complaints of hard chairs. Customers like to be comfortable while sitting in any establishment.

The surveys suggested that his prices are reasonable. He would have to keep his prices comparable to the competition so customers will want to go there. People don’t want to spend more when they can go down the street for a little less money. If he expands his menu he would have to keep those prices in the same range as the area businesses as well.

His business has a big sign on the front so people can see what the business is very easily. He can promote his business by advertising on the radio, social media such as Facebook, Twitter, and LinkedIn. He can also set up a web site, once he updates his computer system. That way people can see what he has to offer.

 He can look at how the competitors are advertising their businesses and do it one step better. Tim has his “buy ten get one free” promotion as well. He could offer a card for free merchandise such as a free donut with a purchase of a large coffee. People like free things.

If Tim implements some of these changes he should be able to keep up with the competition in the area. He will also reach a larger target market with some changes and tweaks in his business.

References:

http://extmedia.kaplan.edu/business/Media/AB299/Tims_Coffee_Shop/exterior_storefront_.html

https://www.mindtools.com/pages/article/newSTR_94.htm

https://www.dunkindonuts.com/dunkindonuts/en.html

http://www.yelp.com/biz/aroma-joes-oxford