starbucks industry analysis Essay

1553 Words Sep 25th, 2013 7 Pages
Starbucks Industry Analysis

The coffee and snack shop industry includes thousands of mom and pop shops to a small number of franchised businesses. The U.S. Census Bureau estimates that nearly half of this industry, 48.0%, of establishments are small business owners with nine or fewer employees. The top four players in the industry are Starbucks Corporation, Dunkin’ Brands Inc., Krispy Kreme Doughnut Corporation and Einstein Noah Restaurant Group, which currently dominate 64.8% of the market.
When it comes to the restaurant industry, many companies have seen their profits and financials in whole decrease. One segment of this industry, the coffee and snack shop industry, experienced the same. Since 2009 players in this sector have
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This is mainly because during the start of this time the country was in recession, whereas the disposable income of consumers was much lower than that of today and tomorrow. As the father of the video game industry, Nolan Bushnell, once stated “I've always thought legal addictions are a great way to create a business. Starbucks is a wonderful example.”3
With the economy improving and unemployment striving to level out, consumers are finding themselves going back to their old habits. Non conscious low- income households, middle- class households, and upper- income households are expected to shop at Starbucks and other coffee and snack shops. However many of the lower income household consumers will likely seek a cheaper alternative to satisfy their cravings.

One area in which the industry has great potential to maximize their revenue is to take their business across seas. With the industry’s high volume of competition domestically, it only seems natural that companies will continue to expand their globalization. In fact, international expansion is anticipated to account for the largest source of revenue and profit growth for the major companies in the industry during the five years to 2018. Take Starbucks for example, initially intending to appeal to a specific target audience the company since has ended up in many markets, domestic and foreign, and has been rapidly growing since. They have become one of the most recognizable brands in the world by

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