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Sample Swot Analysis: Coffee Shops

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    Description of the Business Coffee Shops are establishments where people go and enjoy a cup of coffee. Most shops have wide range of options for the consumers, starting with plain coffee and moving through wide selection of specialty coffee. Locally owned coffee shops typically have control over their offerings. They have the options to expand offerings such as various types of tea, designer sodas and even freshly prepared foods such as salads and sandwiches.

    Great Lakes Coffee Roasting Company is a business entity situated at Detroit, Michigan. It is a roasting company that was based in Bloomfield Hills. It is also a prominent shop at 3965 Woodward Avenue, Detroit. Among it coffee bars are located at Midtown, Bloomfield and Lake Orion. The business is owned by Greg Miracle and started in 1994 as an espresso machine-importing business with his wife. By 1999, Greg and his wife decided to roast coffee beans by themselves which eventually leads Miracle to open his own retail coffee shops at Midtown and Bloomfield.

    Industry Description Coffee Shops industry includes selling coffee drinks and other food and beverages for both consumption within the premises or for takeout. In the U. S. the coffee shop industry includes 20,000 stores with annual revenue of about $11 billion in total. Among the major companies in the industry are Starbucks, Dunkin’ Donuts, Coffee Bean and Tea Leaf, Caribou and Diedrich (Gloria Jean’s). The entire industry is highly concentrated at top and fragmented in the bottom with the top 50 companies have the 70 percent of industry sales. Since coffee is one the world’s largest commodities and among the top green coffee producing countries are Brazil, Colombia and Vietnam. The U. S. is the world’s largest consumer of coffee and also the largest importer of green coffee. Among the major products sold in the coffee shops are beverages and complimentary food items.

    Since Detroit is one of the largest cities in the U. S. , consumer has high personal income that drives them to demand. The high demand for coffee in Detroit leads to the establishing of many coffee shops within the metropolitan area. Great Lakes Coffee has a coffee bar at Midtown, an area that has a business district, cultural center, university and neighborhoods. It is a highly populated area within the city. Securing a location within the Midtown is a good decision for the business. Yet, Midtown is an urbanized place and many coffee shops too also secure prime locations within the area. Competitors can also be found in other industries not only in the coffee shops on the area.

    Among these competitors from other areas are convenience stores, gas stations, quick service, fast food restaurants, gourmet food shops, donut shops. Among the ways to compete effectively is to offer specialized products; serving a local market and providing superior customer service. Adding special offers (new tastes) is among the alternative to compete effectively. Outstanding service/environment (internet, music, comfortable seating area and short waiting queues) are advantages and loyalty programs such as bonus cards ensuring frequency of visits) and choosing a prime locations like retail centers and university campuses. Company Situation Analysis Great Lakes Coffee Roasting Company is situated in the Woodward Avenue and has coffee bar in Midtown.

    These locations are advantages for the business since it is on the midst of metropolitan area. Position – the business marketing strategy focus on coping up with the trend on Coffee, Green or Roasted industry. Among its marketing strategy is providing excellent roasting performance on its premium coffee; giving the best for its customers. Products/Services – Great Lakes Coffee Roasting Company performed by generally gives the demand of its consumers. The company roasts all of the coffees to order on custom-modified drum roaster with precise temperature control and measurements.

    These factors are considered as driving force on a change in the industry. Among these factors are the competitors, consumers and suppliers. Competitors As time goes by competitors multiply because every business entity can easily see the potential of doing a business on a certain place. Coffee shop industry is among the most saturated industry especially in the metropolitan area. However, it can’t easily saturate the entire area due to other factors such as the taste of the consumers, the price as well as location within the area. Great Lakes Coffee has many competitors in Detroit; among these are Hockeytown Cafe, Rowland Cafe, Cafe Con Leche, Chez Zara and Le Petit Zinc, etc.

    Costumers with different ages come with various tastes. Among the factors that may affect the likeliness of the consumers to the business are the tastes, quality of service and the price. As time goes by, consumer’s taste also change therefore, the business should be dynamic and must be able to present new offers to the consumers. Suppliers Suppliers play a vital role in the business industry. A good relationship should be maintained between the business entity and the suppliers. It can assure that the raw materials that the suppliers give to the business is of good quality and the price of the product is affected by the supplier’s price.

    Every year, a new trend in the technology comes and it greatly affects the business. Every industry should cope with changes in the technology. Coffee shops industry doesn’t rely that much on technology but in order to compete effectively on its competitors, Great Lakes Coffee should be able to invest on some gadgets or tech’s related accessories to catch more customers. Adding internet commodities and other applications is an advantage. Conclusions Strong competitions do exist within the coffee shops industry and it is expected to grow up since new shops are being established while bigger companies continue to expand. In order to cope with the competition, innovations are important and must be planned to implement.

    Environmental Scan and SWOT for Great Lakes Coffee is focused on the possible innovations that Great Lakes Coffee Roasting Company should do in order to hold its position as one the rapidly growing coffee shops in Detroit. Competitions are commonly the threat in every business entities, but by knowing the various aspects of the industry as well as the strengths and weakness of the company, such threat can be revoke. Furthermore, every company should be always prepared for the presence of competition. When entering the industry, small business can easily be established yet expansion is slow due to the rapid expansion of major players in the industry. Establishing a brand is one of the factors that Great Lakes Coffee should focus on, since the customers have very powerful effect on the business.

    Services and products should be of high quality and must be presented to the customers at its finest state, because customer’s words can either earn the company a good credit or may damage the business. Furthermore, high dependency of coffee shops chains greatly relies on the frequency of customer’s purchase. Good atmosphere in the shop can keep the customer returning while the same taste might give them the impression of boring taste. As time goes by, Great Lakes Coffee continues to grow and if it can play the game properly it can expand tremendously. Knowing the competition, the economy of the locations, the socio-cultural attributes and taste of the customers is a great advantage for the business to grow in the industry. Recommendations Future events are something that every company should prepare to encounter with.

    That’s the reason why Environmental Scan and SWOT Analysis exist so that every company would be aware of what might wait for them in the future. In order to cope with all the changes as time goes by, everyone company should study the environment of the business industry. On the case of Great Lakes Coffee, where competitor’s small and big competitors can be found in Detroit, making and implementing innovations are very important to keep its business on track. Among the things that Great Lakes Coffee should apply on their business is focusing on the expansion while making a brand name. That’s a bit complicated yet that’s the dual fate in business; it’s a game of quantity and quality.

    Another way to play the game effectively with the competitors is to take a look at their services and product. Knowing the strategy of the competitor is advantage so that the business can add certain stuffs, products or services on its marketing plan.

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