I was recently in a big box retail store looking for Starbucks coffee to brew at home. That bag was a few feet away from what I was really looking for, Veranda Blend K-cups.
A value chain is a series of activities or processes which aims at creating and adding value to an article product at every step during the production process.
Thus the logic behind it is simple; the more value a company creates, the more profitable it is. When more value is created, the same is passed on to the customers and thus further helps in consolidating a competitive edge.
The business activities are divided into primary activities and secondary activities. The primary activities are directly related to the creation of a good or service while the support activities help in enhancing the efficiency and work to obtain a competitive advantage among peers.
Company value-chain can be divided into two groups: Support activities in value creation, on the other hand, include infrastructure, human resources management, and procurement.
The value of value-chain analysis in practical level can be explained in a way that it allow to critically analyse each component of a business practice in an individual manner, and search additional sources for competitive advantage within the component. In the case of Starbucks, the green or unroasted beans are procured directly from the farms by the Starbucks buyers.
These are transported to the storage sites after which the beans are roasted and packaged. These are now ready to be sent to the distribution centers few of which are company owned and some are operated by other logistic companies. The company does not outsource its procurement to ensure high quality standards right from the point of selection of coffee beans.
Operations Starbucks operates in 65 countries either in the form of direct stores operated by the company or as licensed stores. Outbound Logistics There is very little or no presence of intermediaries in product selling. Majority of the products are sold in their own or licensed stores only.
As a new venture, the company has launched a new range of single-origin coffees which will be sold through some leading retailers in the U. Marketing and Sales Starbucks invests in superior quality products and high level of customer services than aggressive marketing.
However, need based marketing activities are carried out by the company during new products launches in the form of sampling in areas around the stores.
Service Starbucks aims at building customer loyalty through high level of customer service at its stores. Starbucks well designed and pleasing stores are complemented with good customer service provided by the dedicated team of employees in green aprons. Starbucks employees are motivated through generous benefits and incentives.
The company is known for taking care of its workforce and this is perhaps the reason for a low turnover of employees, which indicates great human resource management. There are many training programs conducted for employees in a setting of a work culture which keeps its staff motivated and efficient.
Technology Development Starbucks is very well known for use of technology not only for coffee related processes to ensure consistency in taste and quality along with cost savings but to connect to its customers.
Many customers use Starbucks stores as make a shift office or meeting place because of the free and unlimited wifi availability. The company in the year also launched mystarbucksidea. The company has implemented some of the suggestions given via this forum. Procurement This involves procuring the raw material for the final product.
The company agents travel to Asia, Latin America and Africa for the procurement of high grade raw material to bring the finest coffee to its customers. The agents establish strategic relationship and partnership with a supplier which is built up after reconnaissance and communication about the company standards.Starbucks ® Blonde Espresso - seriously sweet and available in all your favorite espresso drinks..
Learn more». Starbucks has managed to differentiate itself from competitors by creating the unique value proposition of becoming the “third place” for customers, after home and the workplace.
Purchasing a cup of coffee became an “affordable luxury” and an experience in itself.
Since , Starbucks Coffee Company has been committed to ethically sourcing and roasting the highest quality arabica coffee in the world.
Today, with stores around the globe, the company is the premier roaster and retailer of specialty coffee in the world. A value chain is a series of activities or processes that aims at creating and adding value to an article at every step during the production process. Starbucks Value-Chain Analysis John Dudovskiy.
Value-chain analysis is an analytical framework that is used to analyse relationships between various parts of operations and the manner in which each part adds value to contribute to the level of revenues. Company value-chain can be divided into two groups: primary and support activities.
Value Based Pricing Can Boost Margins. For the most part, Starbucks is a master of employing value based pricing to maximize profits, and they use research and customer analysis to formulate targeted price increases that capture the greatest amount consumers are willing to pay without driving them off.