Discussion on Starbucks & Nestle Coffee Alliance

In the international market, the competition has increased up to a lot of extents, and many organisations are trying to capture the market share so that they can compete successfully with the competitors. If the corporations do not make any effort in decreasing the competition than there is a massive chance that the company will unable to capture the market share and to sustain in the long run will become quite tricky. Starbucks is creating a partnership with Nestle Corporation so that Starbucks can reach a massive amount of customers. Starbucks does have a presence in many parts of the world, but Starbucks was unable to enter a maximum number of customers.

Nestle is a significant brand take creates & sell coffee products in many parts of the world. Many people whether they are at the home or some other place can enjoy coffee made by Nestle Corporation. When Starbucks packaged, coffee is going to be distributed by Nestle than Starbucks have the opportunity to reach a maximum number of customers. Many customers do not want to drink coffee only in the coffee outlet. The people who used to drink coffee at home prefer packaged coffee. Therefore, Starbucks was unable to meet the needs of such customers. But through an alliance with Nestle Starbucks have a variety of opportunities ahead (Iyengar, 2018).

Starbucks is a major brand and has coffee shops in many parts of the world. On the other hand, Nestle does not operate coffee shops but created packed coffee products like Nescafe which has large market share. Starbucks wants to increase its share of packed coffee which it cannot do by itself because Starbucks does not have the expertise like Nestle. Nestle over the years has gained a competitive advantage in selling packaged coffee. That is why Starbucks has decided to take benefit from the competitive advantage of Nestle (Iyengar, 2018).

Reference of Starbucks & Nestle Coffee Alliance

Iyengar, R. (2018). Nestle and Starbucks are teaming up to create a "global coffee alliance. Retrieved from https://money.cnn.com/2018/05/07/news/companies/nestle-starbucks-deal-coffee-alliance/index.html