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Starbucks - the Secret of the Success

Essay by   •  February 16, 2012  •  Case Study  •  556 Words (3 Pages)  •  4,352 Views

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Starbucks- A paragon of Growth and Employee Benefits

Faces Storm Clouds


#2 How would you prove that happy employees lead to greater sales?

As we all know, there is a certain relationship between employee happiness, customer satisfaction, and profit. They are tied together like a chain. In order for a company to stay in business, it must produce profits. Sometimes though, the focus is just on profits but not enough on the drivers of profits, who are the employees. Employees are the one who represent the company or a product, no matter what the product is. They are the one who have strong communication with the customers, whether internal or external. If they are happy, then customers are happy, or vice versa. What I am trying to say is that it is really important to know if the employees are satisfied and happy with their current positions enough to show this satisfaction to the customers.

We always consider the customer as the king, but what if they are the reflections of the actual kings, they are employees. If there is not any employee working hard and being ethic, we cannot talk about any customer, either. At this point a question comes up to the minds: how does a leader create enthusiasm and ensure job satisfaction for their team members. When it comes to Howard Stultz, besides the managing talents and intelligent he has, he is also a respectful person towards his employees. Even at the first glance, he saw that to be successful at business requires some sacrifice. Because business is a transaction, which means if you do not give, you cannot take any. That was Howard Stultz did when we took over the Starbuck`s.

#5 Do you see any limits to Starbuck`s growth?

There are plenty of limits that might stop Starbuck`s growth such as over-expansion strategy they have. Expanding at every corner, being next to each other and in the same neighborhood strategy Howard Schultz has, made them one on top of another and that has cost them their air of exclusivity, especially in the big cosmopolite cities. Let me give you an example, 2 years from now on, I counted 5 Starbuck`s stores at the same street in one of the biggest cities of Turkey. The main question should be this: Having the exact same store right across the street from each other is really the best strategic placement for increasing the sales and being successful? When I look at the charts I saw that, there are too many Starbuck`s stores and they keep opening the new ones, but if there is not enough demand, this might lead to surplus, thus reduced profit per store.

The other limit might be competition between Starbuck`s and its local or international competitors. For example, in Turkey and across the European countries, maybe the biggest enemy of Starbuck`s is Gloria Jeans, whose is price



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