Question

Do you think Starbucks should continuously enter foreign markets through joint-venture partnerships? What are some benefits and concerns that Starbucks faces by doing this?

Answer 1

In 1971, Starbucks started their journey and now they are operating more than 50 countries in the world. Their total number of store is about 16,706 in 16000 locations around the world. Most of them 8’850 stores are operated by the company and the rest of them are licensed store.  Globalization is a movement toward economic, financial, trade, and connections integration globally. In broader sense, globalisation implies free transfer of capital, goods, and services across around the globe. In business context, cooperation and competitiveness both are embraced by globalization. Major perceptive of depending on each other and shared responsibilities at work across company and nationwide boundaries come from idea of cooperation. The awareness developed by the idea of competitiveness that cooperation without motivation is fruitless to failure and that only practical encouragement can continuous development and growth become a normal way of life.

Theory of international trade:

The exchange of capital, goods, & services across international borders or territories is basically international trade. The crucial to the persistence of globalization is in increasing of international trade. The lacking of international trade and it caused limited goods and services produced within their own borders. There are different model of international trade for the business.

International Business Expansion Strategies of Starbucks:

Subsidiary

Starbucks Coffee International Inc. started its journey as subsidiary of Starbucks which was formed in 1995.As a subsidiary it is liable to introduce improvement challenges beyond North America which combines stores planning and financing, logics and operational management, merchandising of business, improvisation of skilled and matured mangers of Starbucks and introducing new strategy of business development. The international courses of expansion and strategies are managed by the International Starbucks as a separate owned subsidiary. Two strategies are followed when introducing in a brand new market. Licensing and joint venture are the chosen two.

International Joint Venture

The joint venture introduces a strategy towards managerial liabilities .A strategy for new business entity comes with shared ownership which is implied by two or more farms. The agenda of venture strategy is mostly for short time period with some particular quoted mottoes. Starbucks is an example of adopting such strategy in business internationally.Two or more parent farms which deeply invest resources as well as financial momentum to convince particular aims that introduced International joint ventures(IJVs) which are different organizational entities both in legal and economical perspectives.

Joint venture introduces a strategy towards managerial liabilities .A strategy for new business entity comes with shared ownership which is implied by two or more farms. The agenda of venture strategy is mostly for short time period with some particular quoted mottoes. is an example of adopting such strategy in business internationally.Two or more parent farms which deeply invest resources as well as financial momentum to convince particular aims that introduced International joint ventures(IJVs) which are different organizational entities both in legal and economical perspectives.

Manufacturing and foreign joint venture; licensing and joint venture; franchising and joint venture are example of combination market entry strategies. Licensing and joint ventures are the strategies that applied with Starbucks international. Mostly the stores located in USA are owned under corporation, other than USA the stores are under corporation or owned partially in joint ventures .

Benefits

International Business Expansion Strategies of Starbucks:

Subsidiary

Starbucks Coffee International Inc. started its journey as subsidiary of Starbucks which was formed in 1995.As a subsidiary it is liable to introduce improvement challenges beyond North America which combines stores planning and financing, logics and operational management, merchandising of business, improvisation of skilled and matured mangers of Starbucks international (Kotha and Glassman 2003) and introducing new strategy of business development. The international courses of expansion and strategies are managed by the International Starbucks as a separate owned subsidiary. Two strategies are followed when introducing in a brand new market. Licensing and joint venture are the chosen two.

International Joint Venture

The joint venture introduces a strategy towards managerial liabilities .A strategy for new business entity comes with shared ownership which is implied by two or more farms. The agenda of venture strategy is mostly for short time period with some particular quoted mottoes. Starbucks (Briscoe and Schuler 2004) is an example of adopting such strategy in business internationally.(Schuler et al 2003) Two or more parent farms which deeply invest resources as well as financial momentum to convince particular aims that introduced International joint ventures(IJVs) which are different organizational entities both in legal and economical perspectives.

Joint venture introduces a strategy towards managerial liabilities .A strategy for new business entity comes with shared ownership which is implied by two or more farms. The agenda of venture strategy is mostly for short time period with some particular quoted mottoes. Starbucks (Briscoe and Schuler 2004) is an example of adopting such strategy in business internationally.(Schuler et al 2003) Two or more parent farms which deeply invest resources as well as financial momentum to convince particular aims that introduced International joint ventures(IJVs) which are different organizational entities both in legal and economical perspectives.

Benefits

Strategy like franchising or cross-selling can be elected by Starbucks when entering in a new region. It is more licensing alike. Company like McDonald’s which represents the perfect example of franchising. In the scenario of McDonald’s, the real company allows franchising terms to other current farms to deliver their goods. Other than North America every business of Starbucks is owned partially. On the other hand, McDonald’s is a representation of franchising which is owned by separate corporations.

Starbucks may adopt method like franchising. In the franchising method, the relation is more parallel between both parties. In this strategy the franchisee is more controlled by the franchisor.

Manufacturing and foreign joint venture; licensing and joint venture; franchising and joint venture are example of combination market entry strategies. Licensing and joint ventures are the strategies that applied with Starbucks international. Mostly the stores located in USA are owned under corporation, other than USA the stores are under corporation or owned partially in joint ventures.