Expanding the number of stores in a foreign market


  1. Expanding the number of stores in a foreign market, such as the expansion plan
    launched by Starbucks in China (announced in 2018), is a major capital budgeting
    project. A project of this scale requires coordinated planning across all functions of a
    business that you are studying in your Integrated Core classes. Choose and discuss
    three items on the income statement that you think will be impacted by this new
    undertaking. Explain why you chose those particular items, and how those items are
    impacted by the marketing, management and operations decisions of the company.
  2. Choose and calculate three ratios for Starbucks for the last two years. Make sure to
    select ratios that you think would be impacted by expanding in a new market, and
    explain your reasoning. Identify a competitor of SBUX and contrast the ratios. Explain
    why you selected this competitor. Describe how the decisions made by management,
    marketing and operations functions of the company can impact, and hopefully
    improve, these financial ratios.
  3. Explain how the financial decisions regarding opening a new store are related to
    management, marketing or operations decisions that the company must make (or has
    Starbucks has developed a new coffee which uses some standard and some new
    ingredients. It believes this coffee could become wildly popular with its younger customers
    but wants to test market it in a few stores in key locations around the country to assess
    customer reaction.
    You are the manager of a Starbucks store that has been selected for this test marketing.
    a. You have full responsibility for the success of the test market at your store. Write a
    memo outlining the preparations that you will have to make at your store before the start of
    the test marketing. Your memo should focus on at least four of the following issues: staffing,
    training, equipment, supplies, store layout, quality, customer service, etc. (750 words)
    b. Describe any interactions you would have with managers at Starbucks Finance,
    Marketing, and HR as you get ready for the start of the test-marketing in your store. For what
    issues would you need their help and support? (250 words).
  4. Starbucks has been identified as one of the best places to work according to
    employee rankings and job posting websites. It has also earned a number of top
    customer service accolades and many of these recognitions result from Starbucks’
    human resource management practices. Describe how Starbucks’ human resource
    management practices enabled them to build their culture and become a successful
  5. Starbucks’ strategy often enabled the company to successfully compete in a heavily
    saturated market of coffee shops and eateries. Describe Starbucks’ strategy. What are
    some key elements of their strategy that enabled them to maintain a competitive
    advantage and keep customers?
  6. As Starbucks’ business expands, it continually faces issues on how to keep customer
    satisfaction high and maintain and attract business. How has innovation and change
    specifically contributed to the success of the company? As the company grows larger,
    what types of changes are being made to the structure, technology, and people in the
    The objective of the integrated semester is to help you extend your knowledge of how the
    finance, operations, management, and marketing disciplines work and how they integrate
    their functioning in the real world of business. This assignment is an assessment of how well
    you understand this integration. This assignment will be dealing with STARBUCKS and has 2
    Listed below you will find some WEAKNESSES and THREATS for Starbucks, read them
    carefully then proceed to answer the questions that follow:
    Starbuck Weakness:
    1) Customers not willing to wait in long lines at stores during morning rush hour and
    lunch hour.
    2) Coffee dominant business with a poor reputation for creativity around new product and
    companion product development.
    3) Too dependent on word of mouth to create brand awareness.
    Starbucks Threats:
    1) Better value offered by local coffee house shops and national companies like Dunkin
    Donuts and McDonalds McCafe.
    2) Downturn in the economy can decrease customer traffic and spending.
    • • • • •
    1). Assume you are the Vice President of Marketing for Starbucks. Select 1 Weakness and 1
    Threat from the list provided above, and explain how you would recommend taking that
    selected weakness and turning it into a strength and the selected threat and turning it into an
    Part 2:
    Provide 2 explanations as follows:
    2a) Explain how the weakness turned into a new strength would impact the
    disciplines of Marketing, Finance, Management and Operations.
    2b) Explain how the threat turned into a new opportunity would impact the
    disciplines of Marketing, Finance, Management and Operations.

Sample Solution