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ouarmy2012 (66.99)

As I sit in starbucks writing this...



May 04, 2013 – Comments (6) | RELATED TICKERS: SBUX

   I am not one for math and statistics, mainly because for me playing around with it is an experience akin to teaching a cat to s**t in a toilet. I am more of a qualitative analysis kind of person, somebody that likes to find a product that makes peoples lives easier, more comfortable, or is just plain addicting (excluding tobacco products). Go figure i majored in sociology and i like to analyse social trends. 

   Now to my point, starbucks embodies all three of those things i spoke of in the product that they have, coffee. This magic substance, coffee, improves peoples attention, energizes them, and makes their brain crave the caffeine that is inside of it. BOOM, a product that practically markets itself. Starbucks (SBUX) doens't stop there though because you guessed it other entrepreneurs caught onto the idea that coffee shops can possibly be gold mines. 

   Starbuck's product is not just the coffee it serves to the caffeine addicted masses. It serves up an entire Starbucks "experience" that it mirrors in almost all of it's stores... Speaking of how awesome starbucks is a barista literally just gave me a sample of a new cold blended coffee drink...

   This experience first starts with extremely knowledgeable coffee loving workers or "Baristas". One of my biggest loves for companies is how great their workers are. For example, at another local starbucks the workers would regularly experiment with drink combinations and serve them to their patrons as samples. Effectively starbucks has created an army of almost 200000 research and development quasi coffee scientists (estimated 20000 locations and a staff of 10 workers at each). They are also extremely personable and remember names and regular drink orders, even recommending new drinks to those that frequent their locations. The workers are pretty much the backbone of the starbucks "experience".

   To no surprise Starbucks does not stop there. Just like every other chain food service company out there they try to make your experience at their store as easy and comfortable as possible. Their stores are very easy on the eyes and on the body. Colors are very neutral and earthy, furniture is comfortable and sometimes they even have leather chairs to plop our fat butts into. They also have their creamer and sugar station located conveniently by where you get your coffee for easy  addition of any frills that they provide for free. And to top it all off they just as any other chained company make all of their stores extremely similar (atleast in the U.S.) to keep your experience as pleasant in Seattle as it was in Cleveland. 

   The option...while most of us already know what we want before we get to where ever we are going we for some reason want a inordinant amount of choices to confuse us when we get there. Starbucks provides this "option" for us with what they claim to have 87000 drink combinations. However their actual in store menu offers about 50-60 different drinks which to my guess you can probably have prepared in any special way you would like, in reality creating a infinite amount of combinations. Starbucks gives off a "have it your way" menu so effectively used by Burger King without actually saying it. 

   In the "have it your way" spirit Starbucks has realized that not everyone in the world drinks coffee, in fact tea is drank by many more people and has been around much longer than coffee has as a beverage. In realization that they need to break into the tea market they have acquired two major tea companies, Tazo which is now starbuck's brand of tea, and Teavana which is starbuck's stand alone tea company. Starbucks can now push their growth into Asia, a predominately tea drinking Area of the world and market their starbucks "experience" there with tea instead of coffee. Now tapping into not just millions like in the U.S. but billions of peoples lives. 

   Last but not least, Starbucks has been ran exceptionaly well since it's inception and IPO in 1992 under Howard Schutlz who purchased the company in 1987.  Since it's IPO to today it has grown from 140 stores to 20,891 and a revenue of $73.5 million to over $13 billion. A whooping 17,687% increase. If that's not success i don't know what is. While the U.S. market may be saturated, starbucks has barley tapped into their potential in the global market. The room for growth is definitely there and it will continue to do so barring a link between instant death and drinking coffee. 

   The combination of the Starbucks "experience" and exceptional management and leadership of long time owner and ceo Howard Schultz will propel this company into continuing growth in the future. Mind you this is just a qualitative anaylsis of the company, i would be willing to bent a quantitative analysis would yield just as great results.   




6 Comments – Post Your Own

#1) On May 05, 2013 at 12:28 PM, amassafortune (29.05) wrote:

Crediting Schultz is appropriate. When he left, Starbucks went off track. When he returned, the company got back on track.

Until proven otherwise, Schultz is to Starbucks what Jobs was to Apple. 

Can either be like the successful Croc-less McDonald's? 

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#2) On May 06, 2013 at 3:23 AM, joyful3 (55.40) wrote:

I love Starbucks, the coffee and the stock!  

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#3) On May 06, 2013 at 5:19 PM, ouarmy2012 (66.99) wrote:


 That is a good question, one can never really tell, but i don't think when Schultz leaves (i think he is going to be there till he dies) that the company will degrade too much. I am interested to see what Apple will be doing in the next couple years without Jobs though.


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#4) On May 09, 2013 at 12:38 AM, L0RDZ (88.15) wrote:

I've  heard  them  being  referred  to  as   Star Burnt ?   being  not a  coffee  drinker  I  asked  what  does  burnt  coffee  have to  do  with  them  and  how does  one  burn  coffee ?

Apparently  it  has  something  to do with  having  to  clean  out  the  machines  that  make  coffee  and  star bucks  apparently  doesn't  do  this  like they should  and  therefore  have   been  labelled  by  people  in  the northwest  who  actually  don't  serve  burnt  coffee  as   Star Burnts.

Just  what  I've come across ?  maybe  they  are just haters ?


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#5) On May 09, 2013 at 9:57 AM, ouarmy2012 (66.99) wrote:


I actually have never heard of that before, i will have to look it up. I drink tons of coffee though and i think it tastes just fine. That also shouldn't make the coffee taste burnt. They usually serve much more dark roast that light so that might also have something to do with it. I doubt something like that would affect their overall business. I would say they are haters just like all the hipsters who think starbucks is the devil.


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#6) On May 10, 2013 at 3:42 PM, miteycasey (28.97) wrote:


They changed their process to correct this a year or so a go, but you are correct. They frequently serverd 'burnt' expresso, but due to new processess this is no longer the issue.

In previous years I use to have them remake my drink once every 2-3 trips. I haven't had them remake a drink the last year.

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