A Crack in the Mug: Can Starbucks Mend It?
(9 pages of text)
After 20 years of rapid expansion, the last six months of 2007 saw Starbucks jolted by a decline in share price of 50 per cent and a decrease in customer visits. Its share price was hovering around $19 to $20. By mid-2008, it had declined to $18. Its fiscal first-quarter profit in 2007 rose by less than two per cent, and in January 2008, it announced the closing of 100 U.S. stores. In July, the number was increased to 600. The case was written to encourage classroom discussion and research into the company policy and marketing practices in order to discover the means for a possible turnaround of the company.
This case is intended as a stimulus to critical analysis of a complex business situation. Many variables can be seen as possibly influencing or directly contributing to Starbucks’ future success or otherwise. The case can be used in classes from upper undergraduate to MBA-level. The disciplines or areas to which this case is most suited for detailed study or major analysis are:
- Growth strategies
Accommodation & Food Services
United States, Large, 2007
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