Starbucks France governance: Competitive environment analysis

Résumé du document

"Corporate governance is the set of processes, customs, policies, laws and institutions affecting the way a corporation is directed, administered or controlled."

It is made to control the decision-making power of executives so they do not have as a matter of priority their own interests: they have to respond to what the stakeholders are waiting for.

Found in 1971 and bought in 1987 by its current CEO Howard Schultz, Starbucks Corporation is the leader in the market of coffee shops. The turnover of the firm was, according to Datamonitor, $9,411.5 million in the financial year ending 2007. With more than 16 200 shops worldwide, Starbucks is still expanding its activities by entering in new geographical markets and diversifying itself.

Extraits

[...] With more than shops worldwide, Starbucks is still expanding its activities by entering in new geographical markets and also by diversifying them. If its main activities are the management of coffee shops of its turnover) and the sales of licenses (10,9 Starbucks diversification represents of its turnover. It has diversified its products (food, coffee machines, kitchen tools the place to sell them (hotels, airlines, outlets the subsidiaries (Tazo Tea Company, Seattle's Best Coffee) and have even gone out of the coffee sector by founding the record label Hear Music. [...]

[...] Suppliers must be part of the accreditation program to do business with Starbucks. In fact, Starbucks imposes its own rules to suppliers, according to what its stakeholders are waiting for, mainly dealing with equity and responsible business. Sources Fortune Magazine, Starbucks official website, Oxfam America website, Le Monde Starbucks Enhances Corporate Governance; Amends Bylaws to Adopt Majority Voting. Business Wire. 11/2007 [online] Starbucks Thanks Customers and Looks To The Future. Huliq News. 08/01/2008. [Online] Starbucks Announces Strategic Initiatives to Increase Shareholder Value; Chairman Howard Schultz Returns as CEO. [...]

[...] Starbucks has to deal with governments from different countries as it has suppliers all over the world. Starbucks is dependent on their laws, quotas and decisions. Starbucks can have agreements with them as well as disagreements. The Ethiopian example shows both of them. Indeed, Starbucks had an agreement to double its purchases with Ethiopia. But when the Ethiopian government decided to label its coffee so the producer could earn money thanks to the brand name, Starbucks could hardly go against it. [...]

[...] Even if first Starbucks tried to refuse the label, the firm had finally to agree on it. Governments are powerful and Starbucks needs coffees from these areas, considering it is the best coffee of the world. As to a certain extent it represents US imperialism, Starbucks is being criticized by lobbyists, and some stores were broken in the past. Fairtrade Labelling Organizations (Oxfam for instance) have a power on Starbucks as the fair trade label is a key of Starbucks strategy and Starbucks Experience. [...]

[...] The board of directors, composed of 9 directors, adopts principles and charters to lead governance practices of Starbucks. They are powerful in the company, for instance they influenced the new CEO candidacy, Howard Schultz, putting him back at the head of Starbucks. In an indirect way, they decided of the new strategy of the firm, enhancing innovation and customers' focus. According to the new strategic initiatives, Starbucks is more and more focused on customers, to give more importance to the Starbucks experience. [...]