dStarbucks case:

- North American industry

- Specialty coffee
- 1996-1997
- 15% growth due to affordability, knowledgeable consumer base, with
sophisticated taste, trends are changing.
- Peoples are more health conscious
- Rivalry: Starbucks, second cup, coffee bean, mom & pop, van houtte, caribou
- Approximately ~3485 competitors (many of which are mom & pop)
- North American coffee association predicts that there is room for 10k coffee
shops to join until 1999 to satisfy demand
- There is room for more competitors and thus the intensity of rivalry is high
due to crowded marketplace intensifies rivalry, though growth upsets the
intensity and it is thus moderate.
- Don’t only sell specialty coffee, but the experience as-well
- Threat of substitutes: tea, soft drinks, regular coffee, and water. The threat is
moderate due to demand of substitutes decreasing.
- Threat of entrants: barriers to entry are low and thus threat is high
- Threat of retaliation: pretty low due to huge market shares to be acquired
- Multinationals: easy to enter due to networks, distribution channels etc…
- Bargaining power of suppliers: Starbucks has dictating power on quality,
timelines. Low power of suppliers.
- Bargaining power of customers: airlines, grocery stores, restaurants etc.
growth in demand decreased the bargaining power of customers,

Drivers of growth:
Investors: shareholders, own locations
Market: growth in demand
Avenues of growth: international – japan & Canada, grocery stores, specialty sales
(airlines, restaurants), mail orders, more locations (2000 by 2000), costs,
merchandize.
Brand equity: commoditizing of the brand!!!