Overview of Starbuck’s Goods, Services, and Markets

According to MSN Money Starbucks offers both goods and services; they include “High-quality whole bean coffees. Along with fresh, rich-brewed coffees, Italian-style espresso beverages, cold blended beverages, complementary food items, a selection of teas, and beverage-related accessories and equipment, through its Company-operated retail stores. Starbucks produces and sells ready-to-drink beverages.” Starbucks also sells merchandise such as cups and music. They operate in nearly 60 countries with 18,000 retail stores.

http://globalassets.starbucks.com/assets/9a6616b98dc64271ac8c910fbee47884.pdf

http://investing.money.msn.com/investments/company-report?symbol=SBUX

Starbucks Corp

Overview and History

Stock Exchange and Ticker Symbol

Starbuck Corporation’s is traded on the NASDAQ with the

ticker symbol SBUX.

Sources:http://investing.money.msn.com/investments/stock-price?Symbol=SBUX&ocid=qbes&http://money.cnn.com/

quote/quote.html?symb=SBUX

Corporate Headquarters

The firm is headquartered in Seattle, Washington

Sources:http://starbucksfs.com/Company/Corporate

Founding of Starbucks

Starbuck’s first store was located in Seattle’s Pike Place Market. It started off with just one store in 1971. Then the marketing and operations manager, Howard Schultz, decided the small coffee shop should test out some of the strategies that he examined at coffee shops in Italy. He wanted to bring their traditions back to the U.S. He wanted the coffee houses to be a place to converse, and have a sense of community. He left Starbucks to start his own Giornale coffeehouses, and returned in 1987 to purchase Starbucks.

http://globalassets.starbucks.com/assets/e56b2a6b08244aaab0632dc6ac25ad0d.pdf

Highlights from Corporate Annual Report

“After 42 years, Starbucks now operates in 61 countries and recently had most successful launch ever in India” (DeGrande)

“The net revenues for Starbucks increased by 14% or about 13.3 billion dollars.” “The earnings per share increased by 10% from the previous year.” “Starbucks returned approximately 1.1 billion dollars to shareholders during the year.” Operating income also increased, the increase was 11% from the previous year. “Channel Development, which sells ready to drink beverages, teas, and packaged coffees, grew 50%

(1.3 billion dollars).” Starbucks is currently growing towards nationwide distribution of their Evolution Fresh juice

products with “products currently in 2,200 Starbucks stores as well as 1,500 grocery locations.” “In the China and Asia Pacific region in 2012, Starbucks once again posted strong annual returns,

including 11 consecutive quarters of double-digit comparable store sales growth” (Degrande). “Starbucks anticipates having 20,000 stores on six continents by 2014. Additionally, over the next five

years, Starbucks plans to open 3,000 new stores in the American region alone.” “1,063 new stores were opened globally in the fiscal year of 2012.”

http://investor.starbucks.com/phoenix.zhtml?c=99518&p=irol-newsArticle&ID=1753234

Major Events in Corporate History

1971: “Starbucks opens first store in Seattle’s Pike Place Market.”

1982 :“Howard Schultz joins Starbucks as director of retail operations and marketing.”

1987: “Il Giornale acquires Starbucks assets with the backing of local investors and changes its name to Starbucks Corporation. Opens in Chicago, Vancouver, and Canada.”

1991: “Becomes the first privately owend U.S. company to offer a stock option program that includes part time employees. Total stores: 116”

1994: “Starbucks opens its first drive‐thru.”

1997: “Starbucks Foundation is established.”

1998: “Extends the Starbucks brand into grocery channels across the U.S. and Launches Starbucks.com.”

2000: “Howard Schultz transitions to chairman and chief global specialist, Orin Smith promoted to president and Chief Executive Officer.”

2008: “Chairman Howard Schultz returns as CEO. Total Stores: 16,680”

2009: “Launches myStarbucks and Starbucks Card iPhone apps and Starbucks Card Mobile payment.”

2011: “Starbucks celebrates its 40th anniversary with updated brand identity and month of global community service.”

http://globalassets.starbucks.com/assets/e56b2a6b08244aaab0632dc6ac25ad0d.pdf

Overview of Corporate Responsibility, Ethics, and Sustainability

Highlights of Corporate Responsibility Report “Annual Global Month of Service – 230,000 hours of community service and 2100 projects

completed in 2012. Plans to expand for 2013.” “Ethical Sourcing– Starbucks wants to ensure their products are sourced from ethical place.

93% of the coffee sold at Starbucks is ethically sourced. Their goal is to be at 100% by 2015. This also includes every other non-coffee item sold in the stores.”

“Farmer Support - Starbucks opened their first Farmer Support Center in 2004. It was made to teach farmers responsible techniques to growing coffee, and how to improve the quality and size of the crops. In 2012, Starbucks opened 4 new Farmer Support Centers.”

“Farmer Loans–Starbucks provides loans to farmers with reasonable terms to ensure quality crops being grown. Their loans increased from 14.7 million in 2011, to 15.9 million in 2012. Their goal is 20 million dollar loans by 2015.”

“Community Service – Starbucks does community service anywhere their business touches, not just the stores. They increased their community service hours by 40% in 2012, totaling 613,214 hours. Their goal is to have 1 million hours logged in 2015.”

“Engaging Youth –Starbucks has a Youth Leadership Grant program that provides 15-24 year olds with funding for businesses and non-profit organizations.”

“Giving - Starbucks has a charitable organization called “The Starbucks Foundation” which donates money each year to hundreds of non-profit organizations. In 2012, they donated 13.8 million dollars total to over 400 non-profit organizations.”

“Community Stores – Starbucks opened its first community store in New York, in 2012. Community stores are designed to work with a non-profit located in the area they are built.”

“The community stores program focuses on school, employment, housing, health, and safety. It has raised over 800,000 dollars for community revitalization programs.”

“Starbucks has surpassed their goal for 2015 of 50,000 youth members in the program for the last 3 years. The youth involved did 1.8 million hours of community service in 2012.”http://globalassets.starbucks.com/assets/581d72979ef0486682a5190eca573fef.pdf

Environment and Sustainability Efforts

1. “Greener Stores- Starbucks joined the U.S. Green Building Council in to help them develop the LEED program (Leadership

in Energy and Environmental Design.) The program works on more environmental friendly buildings.”

2. “Conserving Power and Water – In 2008, Starbucks set goals to reduce its water and power usage 25% by 2015. Since

then, they have implemented and tested many techniques on how to lower both. Currently, Starbucks has reduced power

usage by 6.5% and water usage by 17.7%.”

3. “Investing in Renewable Energy –Starbucks purchases Renewable Energy Credits that encourage developments of cleaner

energy sources.The credits provide wind farmers more revenue.”

4. “They currently have purchased renewable energy equivalent to 50% of what they use in their stores globally.”

Diversity Initiatives

“Diversity is a core value in Starbucks’ leadership competencies!” “Diverse workplace, increasing cultural competencies, shaping an inclusion

culture, and having a diverse variety of suppliers.” “Starbucks has built 7 partner network groups for insight and research into

new partners, building relationships with partners, and product innovation around the world.”

“Starbucks also empowers 2 diversity councils.” http://globalassets.starbucks.com/assets/581d72979ef0486682a5190eca573fef.pdf

Overview of Management StructureO

Environment and Sustainability Efforts

1. “Greener Stores- Starbucks joined the U.S. Green Building Council in to help them develop the LEED program (Leadership

in Energy and Environmental Design.) The program works on more environmental friendly buildings.”

2. “Conserving Power and Water – In 2008, Starbucks set goals to reduce its water and power usage 25% by 2015. Since

then, they have implemented and tested many techniques on how to lower both. Currently, Starbucks has reduced power

usage by 6.5% and water usage by 17.7%.”

3. “Investing in Renewable Energy –Starbucks purchases Renewable Energy Credits that encourage developments of cleaner

energy sources.The credits provide wind farmers more revenue.”

4. “They currently have purchased renewable energy equivalent to 50% of what they use in their stores globally.”

Corporate Vision, Mission, and Purpose

Starbuck’s mission: “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.”

Principles of Starbuck’s Company-

1. Coffee: “It has always been, and will always be, about quality” / 2. Partners: “We’re called partners, because it’s not just a job, it’s our passion” / 3. Customers: “When we are fully engaged, we connect with, laugh with, and uplift the lives of our customers”/ 4. Stores: “our stores become a haven, a break from the worries outside, a place where you can meet with friends.”/ 5. Neighborhood: “Every store is part of a community, and we take our responsibility to be good neighbors seriously./ 6. Shareholders: “We know that as we deliver in each of these areas, we enjoy the kind of success that rewards our shareholders.”

http://www.starbucks.com/about-us/company-information/mission-statement

CEO and Corporate Officers

Howard Schultz: Starbucksfounder, chairman, president and chief executive officer

William (Bill) Bradley: Allen & Company LLCmanaging director

Robert M. Gates: former Secretary of Defense

Mellody Hobson: Ariel Investments and LLCpresident

Kevin Johnson: Juniper Networks, Inc. chief executive officer

Olden Lee: PepsiCo, Inc.retired executive

Joshua Cooper Ramo: Kissinger Associatesvice chairman

James Shennan, Jr.: Trinity Venturesgeneral partner emeritus

Clara Shih: Hearsay Social, Inc.chief executive officer

Strategic Focus “Increased focus on international

licensed stores.” “Successfully leveraging Starbucks

brand portfolio.” “Focusing on relevant product

innovation.” “Focusing on profitable new growth

platforms.” “Continue to accelerate the growth of

our Channel Development business.” “Balancing disciplined global store

growth and existing store renovation.” “Meet target store-level unit

Overview of Marketing

CEO and Corporate Officers

Howard Schultz: Starbucksfounder, chairman, president and chief executive officer

William (Bill) Bradley: Allen & Company LLCmanaging director

Robert M. Gates: former Secretary of Defense

Mellody Hobson: Ariel Investments and LLCpresident

Kevin Johnson: Juniper Networks, Inc. chief executive officer

Olden Lee: PepsiCo, Inc.retired executive

Joshua Cooper Ramo: Kissinger Associatesvice chairman

James Shennan, Jr.: Trinity Venturesgeneral partner emeritus

Clara Shih: Hearsay Social, Inc.chief executive officer

Strategic Focus “Increased focus on international

licensed stores.” “Successfully leveraging Starbucks

brand portfolio.” “Focusing on relevant product

innovation.” “Focusing on profitable new growth

platforms.” “Continue to accelerate the growth of

our Channel Development business.” “Balancing disciplined global store

growth and existing store renovation.” “Meet target store-level unit

Economic Conditions, Challenges, and Risks

“Risk that customers won’t accept new products” “Declines in general consumer demand for specialty coffee products” “Negative publicity regarding our business practices or the health effects of consuming our

products.” “Labor costs such as increased health care costs, general market wage levels and workers'

compensation insurance costs.” “Lower customer traffic or average value per transaction, which negatively impacts comparable

store sales.” “Customers trading down to lower priced products within Starbucks.” Poorer Economic conditions could affect the way consumers spend “Deterioration in our credit ratings, which could limit the availability of additional financing and

increase the cost of obtaining financing.” “Negative economic conditions persist for a long period= Long lasting changes to purchasing

behavior” “Construction costs associated with new store openings and remodeling of existing stores.”

Major Brands and Markets

“Starbucks Corporation has Six Major Brands Starbucks, Tazo Tea, Teavana, Evolution

Fresh, Seattles Best, and La Boulange spanning products from over 30 different types of coffee,

Merchandise, Fresh Food, Ice Cream, Consumer made beverages, and RTD or Ready to

drink beverages. They have turned their brand/brands into a massively well orchestrated

corporation for premium coffee, tea, baked goods, bottled and canned beverages as well

as merchandise generating 13.3 billion dollars in revenue this past year 2012 according to

the company’s annual report”

Sources:http://globalassets.starbucks.com/assets/9a6616b98dc64271ac8c910fbee47884.pdf

http://investor.starbucks.com/phoenix.zhtml?c=99518&p=irol-reportsannual

Press Releases Regarding Products and Services* “(RED) Honors World AIDS Day With The Launch Of New Holiday Campaigns From Partners To Help The Fight Against AIDS 4:00 p.m. Nov. 29, 2013 - PR Newswire”

*”Starbucks Concludes Packaged Coffee Dispute with Kraft” (November 13, 2013 - Business Wire)

*”Starbucks Launches “Tweet-a-Coffee”; Encourages Spontaneous Gifting on Twitter” (October 28, 2013 - Business Wire)

*”AIRMALL® USA Bringing Signature Brews from Starbucks to Coffee Lovers at Cleveland Hopkins International Airport” (CLE) (October 17, 2013 - PR Newswire)

*”Starbucks and Green Mountain Coffee Roasters Enter Into Expanded, Long-Term Strategic Partnership” (05/08/13)

*”Teavana® Fine Teas + Tea Bar Debuts in New York City’s Upper East Side” (10/23/13)

*Starbucks Foundation Donates $350,000 to Relief and Rebuilding Efforts in the Philippines”

*Starbucks introduces Thanksgiving Blend - A Coffee Fit for a Feast”

*”Starbucks Continues Expansion in India with Opening of New Flagship Store in Bangalore” (Nov 22, 2013)

*”Starbucks Launches New Reserve Coffee: Aged Sumatra Lot No. 084” (Nov 20, 2013)

Use of Social Media

Starbucks Corp not only uses online social media like Youtube, Google Plus, Facebook, Twitter and Pinterest all of which they are on advertise through and keep in contact with the outside world they also went as far as creating their venture in the online realm called

mystarbucks idea. Also most Starbucks locations carry free wifi as per corporate procedure to give the

customer access to the online world in the comfort of his/her local coffee shop. This furthers there

establishment of online advertising and marketing using the social media services to which they belong.

Sources: http://www.starbucksstore.com/on/demandware.store/Sites-Starbucks-Site/default/Default-Start?cm_mmc=Sbuxcom-_-HP-_-CMRedirect-_-HolidayFY14

Overview of Financial Status

Press Releases Regarding Products and Services* “(RED) Honors World AIDS Day With The Launch Of New Holiday Campaigns From Partners To Help The Fight Against AIDS 4:00 p.m. Nov. 29, 2013 - PR Newswire”

*”Starbucks Concludes Packaged Coffee Dispute with Kraft” (November 13, 2013 - Business Wire)

*”Starbucks Launches “Tweet-a-Coffee”; Encourages Spontaneous Gifting on Twitter” (October 28, 2013 - Business Wire)

*”AIRMALL® USA Bringing Signature Brews from Starbucks to Coffee Lovers at Cleveland Hopkins International Airport” (CLE) (October 17, 2013 - PR Newswire)

*”Starbucks and Green Mountain Coffee Roasters Enter Into Expanded, Long-Term Strategic Partnership” (05/08/13)

*”Teavana® Fine Teas + Tea Bar Debuts in New York City’s Upper East Side” (10/23/13)

*Starbucks Foundation Donates $350,000 to Relief and Rebuilding Efforts in the Philippines”

*Starbucks introduces Thanksgiving Blend - A Coffee Fit for a Feast”

*”Starbucks Continues Expansion in India with Opening of New Flagship Store in Bangalore” (Nov 22, 2013)

*”Starbucks Launches New Reserve Coffee: Aged Sumatra Lot No. 084” (Nov 20, 2013)

Revenues (Past 3 Years)

10.71 billion In 2010

11.7 billion In 2011

13.3 billion In 2012.

http://www.marketwatch.com/investing/stock/sbux/financials

Net Income (Past 3 Years)

945.6 million In 2010

1.25 billion In 2011.

1.38 billion In 2012.

http://www.marketwatch.com/investing/stock/sbux/financials

Earnings per Share (Past 3 Years)

1.27 For 2010

1.66 For 2011

1.83 For 2012.

http://www.marketwatch.com/investing/stock/sbux/financials

http://www.nasdaq.com/symbol/sbux/revenue-eps

Current Ratio (Past 3 Years)

1.452 For 2010

1.549 For 2011

1.963 For 2012

http://www.marketwatch.com/investing/stock/sbux/financials

Current Stock Price

80.03 billion

http://www.marketwatch.com/investing/stock/

Analyst evaluation of Corporate Stock

Strong buy.