Starbucks Corporation is Most famous American coffeehouse chain and coffee company. It is founded in Seattle in 1971. Currently, the company is operating more than 30,000 locations across the globe. It basically presents the second wave coffee or darkly roasted coffee. With the change in coffee making process and many competitors preferred automated machine, Starbucks also started using automated espresso machines. This helps it in improving the efficiency level and safety hazards (Starbucks, 2020).
This article is about the VRIO analysis, which is the framework or model used by the company as the strategic scheme. The main strategic process of the company starts with the vision and mission statement, and then objectives, analysis, strategic decisions and implementations. VRIO helps the company in evaluating the company’s resources and competitive advantage. Here is the detailed VRIO Analysis of Starbucks.
Value
The first component of the VRIO analysis is Value. The component deals in providing the beneficial opportunity for the stakeholders. Starbucks is one of the most famous coffeehouse chains across the globe. The company has strong brand image, as this is the valuable resources which helps in growing the consumer base. The company is successful enough in making great reputation which is important for marketing. Starbucks’ quality of coffee and special flavors are also valuable resources. It successfully maintained the consumer base and service with its quality. It develops the store environment and ambiance to complement the quality. It sources the good raw materials and products quality (Burse, 2019).
Rarity
Rarity is the second component of the VRIO analysis. Starbucks is successful enough in making its brand rare which makes it famous across the globe. The strong brand image is the big challenge for competitors. Starbucks has made significant investment into the procurement and then it developed different flavors like pumpkin spice etc. It trains its staff properly and paid special focus on that. Moreover, it invested more in logistics and supply chain distribution which is very efficient, and it is very difficult to achieve. The culture of the company, brand recognition, and customer loyalty which Starbucks successfully achieved as the permanent competitive advantage (Hani, 2015).
Imitability
Imitability is one of the main components of VRIO analysis. It is difficult for the competitors to develop the brand image as strong as Starbucks, as the company is successfully able to make its global presence at such greater level. However, there are competitors like Tim Horton who can be able to compete with Starbucks at same level, but it will require time and investment. However, its store environment is not that difficult to imitate. Starbucks is enjoying its competitive advantages to great extent and avail the opportunities from it (Google sites, 2020).
Organization
Starbucks make sure to use its competitive advantages to the fullest. The company is one of the well-managed, and strategically well organized, which is quite evident with its success. It makes sure that its staff is skilled and properly trained in every aspect. It takes good care of the safety hazards. It used its brand image as a good marketing tool. Furthermore, it makes sure its machines and other resources are well managed and up-to-new technology (Hani, 2015).
Conclusion
Star bucks is one of the famous coffee company and chain across the globe. It has successfully managed its resources and competitive advantages. The company has covered all the components of the VRIO analysis very well and competing in the industry strongly. It is enjoying its market growth rate and position very well and work hard to retain it.
| Resources/Capabilities | V | R | I | O | |
| Supply Chain | ✓ | ✓ | ✓ | Competitive Parity | |
| Brand image | ✓ | ✓ | ✓ | Competitive advantage | |
| Inventory management | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Customer service | ✓ | ✓ | ✓ | ✓ | Sustainable competitive advantage |
| Marketing | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Product quality | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Product range and flavours | ✓ | ✓ | ✓ | ✓ | Sustainable advantage |
| Talented HR | ✓ | ✓ | ✓ | ✓ | Competitive parity |
References
Burse, C. 2019. Applying the VRIO framework to Starbucks. [Online], Available at: https://ceburse.blogspot.com/2019/02/applying-vrio-framework-to-starbucks.html, [Accessed on: 7th March, 2020].
Google sites, 2020. VRIO analysis- Starbucks. [Online], Available at: https://sites.google.com/site/starbucksanddunkindonuts/business-strategy/vrio-analysis, [Accessed on: 7th March, 2020].
Hani, M. 2015. Starbucks VRIO analysis. [Online], Available at: http://sys752blog.blogspot.com/2015/04/starbucks-vrio-analysis.html, [Accessed on: 7th March, 2020].
Starbucks, 2020. About us. [Online], Available at: https://www.starbucks.com/about-us/company-information, [Accessed on: 7th March, 2020].