To get a better comprehension of what is value chain about, let us define what is value chain before I will discuss how Starbucks is managing its value chain to gain competitive advantage.
According to Jones and George, “value chain is the coordinated series or sequence of functional activities necessary to transform inputs such as new product concepts, raw materials, component parts, or professional skills into the finished goods or services customers value and want to buy” …show more content…
Starbucks Mission: To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.
Most people nowadays started their day with a cup of coffee to give them a boost and energy before going to work or starting their day. Starbucks knew that people love coffee, just like the quality coffee director of Starbucks, Mr. Linneman quoted in the video, “I cannot imagine a day without coffee.” In addition, people who are busy, they have no time to get up, prepare breakfast and brew their coffee, so Starbucks capitalize on this idea (product development and marketing research).
In order to give value on their coffee (quality of coffee) that they served, as per information on their website, Starbucks’ buyer travels to coffee farms in Latin America, Africa and Asia in order to get the highest quality coffee beans (materials management function). Moreover, Starbucks applied the Total quality management on the coffee that they have bought from these countries and communities where they have store, by doing the coffee tasting in all the coffee beans they procured to ensure the taste is …show more content…
The above-mentioned functional activities are the reason why Starbucks thrive and stay competitive because they knew what their customers want and need: coffee and adjacent products that complements their coffee and retailing the same coffee beans, coffee machines and other products they used in making their drinks.
Does Starbucks care for their customers and financial needs?
Not only Starbucks served best coffee and drinks to their customers, they are also known to be responsive to their customers need and want, that is why they charge premium for their drinks and coffee. This above-statement is reinforced in our textbook that says, “the more desired product attributes a company’s value chain builds into its products, the higher the price that must be charged to cover the costs of developing and making the product” (Jones and George 278).
Based on the above-mentioned, we can say that Starbucks really care for their customers, but how about the premium price they charge for their drinks? Does it mean they do not care for the customers’ financial