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Starbucks Globalization

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Introduction Since I’m interested in history of legendary brands I have always wondered what makes some organizations globally known and recognized throughout the world and how it eventually affects our culture in general. For my ethnography study I have decided to explore probably the most famous coffee shop in the world – Starbucks. Having subsequently examined the theory of globalization, in my report I would like to reveal the features due to which this theory can be applied to Starbucks and to show how it really works in the real life.

Company overview Website: www. starbucks. om Founded: 1971 Country of origin: USA. Number of outlets: 20,366 Commercial and economic activities of the company: 1. Starbucks owns more than 20,366 stores. 2. Starbucks is the largest coffee shop chain in the world. 3. It is one of the most expensive brands in the world. 4. Stores are located in more than 61 countries. It is almost impossible to imagine the modern world without Starbucks. Today it is the world’s largest chain of coffee shops, which is known and loved for comfort, high-quality coffee and its special atmosphere that prevails in all the stores all over the world.

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Now it’s hard to believe, but before Starbucks America practically didn’t know what real coffee was – it was just the domain of a few gourmands. But in business, as in history, there was a person who played an active role: the man, who fell in love with good coffee and made love it the whole America, and then the world. Starbucks’ green signboards have already become part of the urban landscape in many cities around the world. According to the company Brandchannel, Starbucks is one of ten best global brands and also it is praised as the most desired coffee shop.

Few small businesses operating for less than thirty years can grow so rapidly – the company started in 1985 with a cafe, and today the number of Starbucks coffee shops is more than 60 thousand – maintaining its original character at the same time. Fortune Magazine tirelessly admits that Starbucks is one of the “favourite” companies in America with the best staff in the world. According to the Business Week magazine, Starbucks is the world’s best brand. Business Ethics annual edition includes it in the list of companies with the highest degree of social responsibility.

From 1971 to present, Starbucks opened its coffee shops in more than 61 countries around the world, including such typical tea lovers’ countries as Japan and China. In addition, it continues to win national markets and opens up on average four coffee houses per day. Starbucks is the first coffee shop that offered U. S. residents quiet and cozy atmosphere of the “third place” where people regardless of their age, social status, ethnicity, culture and mentality are pleased to come after work or household chores.

As Starbucks became a monopolist in the coffee sales sector it had chosen the right position to maintain their business for many years. An individual personalized attitude to each employee and customer, brand scent and relaxing music, high standards of roasted coffee, territorial accessibility, innovation, and most importantly the ability to maintain all the components on a high level are the key factors of the uniqueness of this place. The answer to its success is simple: Starbucks’ company has found its own unique niche.

While the other companies fight for cheapness of their beverage and forget about its taste, Starbucks offers premium quality coffee, for which clients are willing to pay extra a dollar or two and forget about cheaper offers. Overview of perspective Globalization – is not just an activity, it is a process in which we are all involved, not only as subjects but also as objects, because it’s not just what people do, it’s what happens to people.

The question of globalization is very important in the modern world because its process changes the world radically. Nowadays, the effects of globalization can be seen everywhere. Globalization is a multidimensional phenomenon. The process of globalization affects various spheres of life of individuals and society as a whole: economy, politics, environment, culture, and even the religious sphere. But the most powerful change globalization has is on the economy.

Economic globalization triggers the changes in other areas and it is one of the consistent patterns of the world’s development. Distance, geographical and political boundaries are becoming increasingly of less importance as obstacles to movement, exchange of information and organization of production. Thomas Friedman, one of the best-known hyperglobalizers, defined globalization as an unprecedented phenomenon, which leads to greater integration between nations, societies, blurring the state sovereignty and cultural boundaries. (Friedman, 2000).

But still most skeptics think that globalization does not exist, on the contrary, there’s an opposite process – regionalization. Between these two radical positions there are transformationalists who believe that globalization is a historically unprecedented and controversial phenomenon which has a long process of development and a powerful transformational impact. The main indicators of globalization are the scale of processes involved in globalization (the movement of goods, people, capital and information) and the speed of information transmission.

Globalization brings both benefits and risks; the latter have global and potentially catastrophic character. One-sided globalization, commonly referred to as neo-liberal, increases these risks, resulting in an opposite reaction or alterglobalism. Globalization, despite its objectivity, is a complex transformation of the entire world system, which, along with enormous benefits is associated with the opportunity to coordinate the governance of the system that can significantly transform the system of national cultures.

It should be understood that such modifications shall not be based only on economic and political components. We’d rather take into account the fact that there is a necessity of realization of a different type – cultural unity based on cultural diversity. It is strategically more advantageous, as it provides flexibility of the system and, therefore, possibility to solve more complex problems. “Globalization” has become a negative word.

Although we all constantly use the advantages generated by open markets, free trade and internationalization, most people believe that it is the process of globalization which we should blame for the unequal position in which the developing world has appeared and the reduction of the number of workplaces which we are facing now. At the same time brands representing the public face of such companies are condemned in unison by society and naturally become “scapegoats”, responsible for the excesses of global capitalism.

Accusatory arguments of opponents of globalization and capitalism, on the streets of Seattle and Genoa, have become major political and social issues. Brands and their creators were accused of manipulating our desires, adverse effects on our children, destruction of nature, use of financial and political leverage to control organizations, leveling of the cultural differences and exploitation of the poorest parts of the world to create things that we want to have. Analysis of the organization

Since its inception in the 1970-s of the 20th century, Starbucks has positioned itself as the third place after home and work, where people spend their time chatting with their friends or even holding business meetings. The smell of freshly ground coffee fills the brightly lighted room of coffee houses with comfortable tables and chairs. Customers can charge their players or laptops from conveniently located outlets. Most Starbucks stores in the U. S. and other countries have wireless access to the Internet.

The success of Starbucks lies not only in an effective business model but also it is due to an unusual approach. (Marques, 2008). There’s various size furniture for different-sized groups: hard-wood community tables, comfy sofas, barstools which face the window and lots of upholstered armchairs. Starbucks interior design is full of warm inviting colors complemented by soft dimmed lighting. Starbucks is a perfect place not only to meet with friends, but to enjoy some time on your own while drinking your favourite beverage. But even in that case, the people, talks and music make you feel that you are not alone.

In Starbucks you’re buying not just a liquid refreshment, you’re buying half an hour of comfy chairs, swanky jazz and the environment that looks nothing like your office. In addition, nobody rushes in a Starbucks cafe; you can stay after drinking your favourite beverage as long as you wish. Thus, Starbucks business model was originally based on two main ideas – high quality coffee and the quality of the environment, the ambience in which it is consumed. This allowed Starbucks more than just creating a new culture for the U. S. coffee consumption.

The company has taught Americans to perceive drinking coffee as a process, not just as a drink. Massive expansion raised another challenge to Starbucks – freshly roasted coffee must be delivered to all the cities of North America and to all international markets. Transportation would have a negative impact on the quality of the product, but to create a plant in each city where grains are roasted appeared to be rather expensive. The problem was solved by using special vacuum packages that can preserve the taste of the product. Also, the company introduced a special scheme of fair trade.

According to this scheme the company buys coffee directly from farmers, avoiding intermediaries. This has increased the income of farmers by 2-2. 5 times, but it has become more costly to the company. Starbucks has also set up a special charity fund, which has been funding educational, environmental and health projects in the countries where coffee is purchased. But during the expansion, Starbucks switched to automatic espresso machines, preferring their semi-maker with great leverage. Coffee shops began to sell hot food, cold drinks and even CDs.

In addition, the charge of Starbucks’ monopolistic position was removed due to competitors who actively copied ‘Starbucks experience’. Starbucks follows the same derived formula which is not only good for the clientele, who know what to expect from it, but also ensures the stability of the company and establishes a strong link with the awareness of their visitors, so that they always remember and recognize it. It also explains why enemies often say that such companies like Starbucks injuriously live by small businesses, while chains themselves deny it, admitting only that they expand and create new markets just for their products.

However, the aggressive policy conducted by chains has the additional benefit – at the same time competitors are replaced. Needless to say, the unification of the design of the stores became an important step for Starbucks. Initially, the company adhered to the concept of “favourite coffee house of the district” and managers sought to ensure that each store is unique. Therefore, the chain was much different both in area and in its design. However, the idea of economies of scale led Starbucks to come to the same standard. Design became similar.

In addition to this, it was significantly easier to promote the brand. One of the main requirements when opening a Starbucks coffee shop, is the location of the front door – it should come out to the south or east, and never to the north. This disposition does not cover the light and simultaneously does not get too bright. With all of this, the rigorous standardization and unification, as in the army, is seen everywhere: the same set of drinks, snacks, the same dishes, the same assortment and similar uniformed welcoming and smiling waiters.

For example, comfortable chairs which were the part of the concept of Starbucks as a place of leisure and comfort, have been replaced by plastic chairs. On the other hand, in any coffee shop there is the same range of basic goods. Wherever you would be – you can always have your favourite coffee. The company is not a supporter of fixed prices, every day they could be changed but nevertheless the company’s menu remains the same, or rather, its main offers. The range is supplemented periodically with tasty and fragrant novelties.

However, Starbucks presents special products created in accordance with national traditions as well. The idea of ?? standardization of the stores with the same menu in different parts of the world also affected the music. Music promotes a special charm, a soft background playing in every store and in all Starbucks coffee shops – in Moscow, Tokyo or New York – simultaneously they will play the same composition, paraphrasing the famous slogan «Starbucks – connecting people». Conclusion

Starbucks coffeehouse chain is often cited as an example when it is necessary to point out the flaws of big business: obsessive spread of ugly advertising, tedious uniformity and standardization, absence of choice, destruction of towns and smaller competitors in the U. S. and finally, the exploitation of raw material suppliers. But if you face the truth, we can say that Starbucks’ company did not destroy a thriving business, but revived the dying industry. In America, due to Starbucks it became possible to stop the downward trend in coffee consumption outside home and promote its growth by twofold in comparison with the middle 1980s.

Also the increased attention to the quality of products and services of local operators forced to follow the proposed standards or exceed them in order to stay in business. The result was a general expansion and prosperity of coffee shops. The new culture of coffee has been introduced in other countries. And everywhere it changed the situation in the local markets, as local cafes, restaurants and the network had to change their perception of ?? coffee. Having awaken a well-grounded fear of rivals, it thereby causes them to improve the quality of products and services.

Also due to Starbucks all these features of American Coffee mania led to the fact that the world was enriched by heat-resistant disposable cups and stands under the glasses in the car. Active development in the United States and then in the world led to improvements in the network of fast food and System Drive Thru. In addition to this, reusable mugs and glasses or completely recyclable dishes are what Starbucks tends to use as part of its impressive programs of the environmental protection.

If we talk about standardization, it stands out for another feature – the atmosphere in the coffee houses. On the one hand, the basic elements in all Starbucks’ stores are similar, but on the other hand, each coffee shop has its own characteristics, its unique atmosphere. Eventually competitors acknowledge that Starbucks raises consumer interest in this market and contributes to its growth. Therefore most of the national independent producers managed to survive successfully during the last decade and some merit in it belongs to Starbucks. [pic]

Cite this Starbucks Globalization

Starbucks Globalization. (2016, Sep 16). Retrieved from https://graduateway.com/starbucks-globalization/

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