Byung-il Min
D301 9:00-10:15

The Globalization of Starbucks

Case Discussion Question

1. Where did the original idea for the Starbucks format come from? What lesson for international business can be drawn from this?

-First of all, Starbucks’s strategy was to provide their own premium-roasted coffee and freshly brewed espresso-style coffee beverages, along with a variety of pastries, coffee accessories, teas, and other products. When they spread to Japan coffee market, they used Japan’s local retailer, Sazaby Inc. Even Starbucks joined with Japan Venture Company, they didn’t lose their own coffee shop style. Finally they could get the success in the Japan market. In the international business, companies who want to invest to other country have to research and get a lot of information because they don’t know about foreign rules and regulations of business.

2. What drove Starbucks to start expanding internationally? How is the company creating value for its shareholders by pursuing an international expansion strategy?

-Starbucks expects the foreign opportunities. At the 1990’s, Asia didn’t have any coffee shop markets. Moreover, coffee culture is not friendly to Asian. Someone thought Starbucks’s adventure doesn’t achieve. However, Starbucks used the “Starbucks experience” in North America, which coffee stores became places for relaxation, chatting with friends, reading the newspapers, holding business meeting, or browsing the web. This experience smashes to Asian customers.

3. Why do you think Starbucks decided to enter the Japanese market via a joint venture with a Japanese company? What lesson can you draw from this?

-I think that Starbucks’s strategy, which is joint venture with a Japanese company, is really good idea. There are some reasons. First, Starbucks doesn’t know Japanese culture and situations of business and economy. A joint