Using the Porter’s Five Force Analysis a company can define its attractive features and how the company will identify the potential to change and compete in the market with full power.

a) Threat to new entries:

·         The threat of the new entries to the Starbucks is at a moderate level because, because the barriers of entering into a new market are more visible because Starbucks itself is one of the famous snacks and coffee companies because new entries will feel discouraged to enter in the market and very few new companies will take the risk to enter into the market.

·         Moreover the saturation or desire of the industry is moderately high in the market that creates a monopolistic structure of competition in the market.

·         For the new threats or the new entries in the market, the investment which they will do is at an initial level because they can do the investment by getting the stores, equipments and other things of investment on lease.

·         As Starbucks operate on a global level and is a little bit expensive as well, the other coffee shops can operate at localized level in the local market. Because there will be no such competition at the local level and there will be no switching costs for the customers as well. Though there is a lot of competition in the market but still some new entries can be successful if they operate at the local level.

·         But this new entry in the market will be competition for the coffee shops operating at local level, because the large brands have achieved a standard and the scale of economics in the market by the high efficiency, lowering the cost of their products in the market and the huge market share which they have achieved in the market. These things are obstacles for the new entries in the market. And the coffee shops operating at the local level have to differentiate their services and products from the Starbucks and has to maintain the quality of the products and how will they attract the customers in the market.

·         The expected and the resulted retaliation from different well developed and well establishes companies in the market that have high efficiency, more resources, and are located in different countries, they have more publicity in the world, all these things creates a barrier in the market for  the new entries.

b) Threat of Substitutes:

·         There are many substitutes in the market that can compete with the Starbucks and Starbucks have threat fromthese kinds of substitutes like the reasonable  substitutes available in the market including the coffee, tea, water, fresh juices, soda’s and the energy drinks. Other entertainment areas include the Bars andthe Pubs in which different type of alcoholic drinks are also available as a substitutes in the market against the Starbucks.

·         Moreover, the consumers and the local people and citizens can also make the coffee at home with the premium coffee makers available in the market. And they can produce coffee at home with the minimum price and they don’t have to pay the premium cost for the coffee to the retailers in the market like the Starbucks.

·         But Starbucks is overcoming all the threats of substitutes by providing coffee makers, premium coffee satches and packets in different grocery stores in the market so that the threat will be less and if people wants to buy the substitutes to get the coffee easily at home in low price then they can buy from the products of theStarbucksavailable in the grocery stores.

c) Bargaining power of the Buyers:

·         There are many different people and buyers in the market and each and every buyer has their own requirements but the bargaining power of the buyers in the situation off Starbucks fall from moderate to low because not a single buyer can demand for the concession of price while buying from Starbucks.

·         As Starbucks, provide the products according to the requirements of the consumers and this makes the buyer powers end and if the products are available according to the need and requirements of the buyers than it will erode the buyer power of the buyers.

·         Moreover, even though there are no switching in the costs of the products that re available in the Starbucks but still Starbucks set its prices of the products according to the competition and trends in the market and by observing the tactics of its rival, Starbucks set the prices by observing all these things.

·         But still consumers are trying to get the products with the best taste in least prices and if they are paying more prices then they want the premium quality. So they move towards Starbucks to get the premium quality products at the reasonable prices as compared to other coffee shops because in this case the buyer power is eroded and they cannot bargain and get concession over these products in different coffee shops.

d) Bargaining power of the Suppliers:

·         The main things utilized by the Starbucks company in order to made the most premium coffee is the Coffee beans and the premium coffee of the Arab which is grown in different selected regions. And these are the standard outputs of the Starbucks Company and so it is difficult for the Starbucks Company to switch the suppliers because that re getting their supplies from the best exports of the coffee and to change or switch the suppliers is difficult for them.

·         As Starbucks is the largest coffee shops in the industry of coffee and snacks, so it can take advantage of this and can take the advantage form the suppliers but still it maintains a fair and honest trade with the suppliers and in the case of the Starbucks the bargaining power of the suppliers fall from moderate to low.

·         And moreover the Starbucks has become an important part among the suppliers from which they export the products and due to this the bargainingpower of the supplier has become low as they have been supplying the product to the Starbucks from the old times and 6the suppliers don’t want to lose the connection with the Starbucks because of the scope and the size, it has maintained globally, so power of the suppliers in this situation is low.

e) Intensity of the Competitive Rivalry:

·         The intensity of the competitive rivalry fall from high to moderate, because there is a lot of competition going on in the global market. A monopolistic competition has been going on in the market. As Starbuckshas the largest shares in tiemarket and same level of shares,the rivalries of theStarbucks is sharing in the market, so it is a toughcompetition for the Starbucks in the market and this exerts great pressure on the Starbucks.

·         And in the case of the consumers, they do not have any cost of switching while switching to other competitors in the market, and this creates a competition between the rivalries in the market.

·         But the Starbucks is different from its rivalries in terms of the products it provides because the products Starbucks provide is moderately different from the other rivalries and competitors in the market. And due to all these conditions a moderate level of intensity is found between the rivalries of the Starbucks due to its uniqueness of the products.

·         The Starbucks industry has attained a level of Maturity in the market and now the growth rate of the market has become low because of the, maturity and the low growthrate will create an intensity in the competition between the rivalries of the Starbucks because all the competitors in the market wants to attain level of achievement like the Starbucks and they want to increase the market shaper and wanted to become established and developed firms like the Starbucks.

·         All these factors lead to the competition between the rivalries in the market and the competition has increased for theStarbucks due to the high goal of its rivalries.

So, by using the Porter’s Five Forces Analysis, we can determine the analysis of the industries and the strengths of the industries and the potential for them to change.

References of Porter’s Five Force Analysis of the Starbucks Company:

Bonchek, M. (2013, MARCH 14). Purpose is Good. Shared Purpose is Better. Retrieved October 2019, from https://hbr.org/2013/03/purpose-is-good-shared-purpose

FARFAN, B. (2019, August 5). Starbucks' Company Mission Statement. Retrieved October 2019, from https://www.thebalancesmb.com/starbucks-mission-statement-2891826

Geereddy, N. (2013). Strategic analysis of Starbucks corporation. Retrieved October 2019, from https://scholar.harvard.edu/files/nithingeereddy/files/starbucks_case_analysis.pdf

THOMPSON, A. (2017 , JANUARY 31). Starbucks Coffee’s Stakeholders: A CSR Analysis. Retrieved October 2019, from http://panmore.com/starbucks-coffee-stakeholders-csr-analysis