Top Challenges Facing Starbucks
Every company faces major challenges, even companies that are as successful as Starbucks. Although they have an outstanding reputation, have won many awards, and even give back to their community, they are still facing challenges like any other company. The most obvious challenge that Starbucks is dealing with is the current financial crisis in America. Many companies are suffering from our economy and their situation.
Another challenge that Starbucks has been facing in 2008 is the amount of store closures. In July 2008, they announced to the public that they would be closing 600 stores in the United States. Starbucks stated, “Actual store closures may differ depending on a variety of factors including, but not limited to, risks related to finalization of third party agreements, expected costs savings, income tax and other benefits associated with the store closures in the anticipated time frame, if at all.” Although Starbucks did close the store locations, they did the right thing by first informing the appropriate stores but also letting the public know what was going on. There were numerous press releases that discussed this matter and what was being done about it.
Another challenge that Starbucks is dealing with is competitors. There are numerous coffee shops all over the world and being able to stand out to generate customers is important. Their main competitors are Dunkin Donuts, McDonald’s, and Nestle. It is important that for Starbucks to know their competitors and what they are currently doing.
Although Starbucks has daily challenges like all other companies, they are known for handling these situations in a detailed manner. They have made adjustments to accommodate the current financial market. Also, they have dealt with closing 600 stores in the United States but the company was always up front with the public and kept them informed with which stores were closing and the reasons behind this. The final challenge that Starbucks deals with is competitors. All companies have to take into consideration other businesses that are selling the same products or services. Overall, Starbucks deals with challenges and has a reputation of being able to maintain these in a productive manner.