Starbucks as a MNC is directly affected by the economic and legal environment of all the

countries it has operations in. Starbucks in recent times has been directly affected with
reduced profits and increased labour costs by the downturn of the world economy and rapid
rise of inflation due to several external factors such as the Covid 19 Pandemic and the
Russian Invasion and subsequent Western Economic Blockade on Russia. Starbucks has also
seen a downturn in Sales as customers have turned to cheaper alternatives than their product,
However this could present an opportunity to Starbucks as this would allow them to offer a
new product in the form of coffee grounds or mixtures to be prepared at home which would
negate the need for labour to provide the coffee. Starbucks must also be weary to ensure they
are meeting all legal regulations in both the USA where they host their Headquarters and
their 32,000+ stores in 80+ different countries in order to not face penalties.

The Global business environment helps facilitate the improvement of Starbucks' image and
gain strategic value as they help develop new products and increase their Starbucks market
share. Because of this, they are able to place orders towards Starbucks and negotiate prices.
Apart from these factors, great competition in retail between coffee chains.

The internationalisation strategy of Starbucks involves using three approaches which are
wholly owned subsidiaries, joint ventures, and licensing. The licensing procedure is used
when Starbucks wants quick expansion in a particular country.

The company will also be able to make an extra profit from foreign investment around the
globe on their return on investment. The disadvantages for Starbucks international expansion
can be involved with lack of control or the operational risk where it might be working and
might not for some countries.

Starbucks started using the new advancements in the technological world to their advantage
in order to personalise their customer experience. With Starbucks introducing their new
mobile app, customers can customise their own drinks by the tap of a button, not only that;
but customers can also get exclusive offers and rewards from just using the app. The main
goal of Starbucks new app is to increase customer engagement and loyalty to the brand by
giving them rewards and other features. In recent years, Starbucks started giving customers
free access to Wi-Fi in all their stores around the world which made Starbucks a great place
for customers like students to come to the store and work on their assignments while they are
enjoying their coffee.

It is one of the most important business environments as it aims for good quality products at
low prices with good customer service. This will allow Starbucks to increase sales and
profits. Competitive environment consists of two main types. Competing by exceeding
customer expectations, which means that successful companies search for the unhappy
customers to see the problem facing them and then regulate their needs and wants to meet
customers’ demands like a variety of drinks to grab their attention. While competing by
Restructuring and Empowerment is giving subordinates more decision-making power by
managers since the business is more Customer-Driven, also from its merits is that they can
benefit in making quicker and better decisions that helps Starbucks to develop its coffee taste
by the feedback given. The Empowerment is giving a frontline worker the responsibility,
authority, freedom, training, and equipment they need to respond quickly to customer
requests. This helps Starbucks as they detect the problem quickly and improve their
reputation.

Undoubtedly, Starbucks have a significant impact on the communities they work in because
they have partnerships with non-profit organisations that offer services specified to please
their customers which is one of their strategies as they know a happy customer is a good
asset.

Starbucks has a strong ethical image which demands them to contribute to the community
and make it stronger , so they created three pillars which are “being present, connecting with
transparency , dignity and respect”. They try to be socially responsible by not using child
labor , promoting volunteering and not harming the environment by using paper straws
instead of plastic straws for example. Their social responsibilities led to the rapid growth of
the company and building a healthy relationship with their customers.