Competitive Analysis for The Bean Coffee Shop in Yokosuka
This paper presents a competitive analysis for The Bean, a proposed American-style coffee shop at Yokosuka Naval Station, Japan. It examines the competitive landscape across three categories: direct competitors offering similar experiences (Starbucks and Doutor Coffee), differentiated competitors such as independent Japanese kissaten, and substitute products including ready-to-drink coffees sold in convenience stores and supermarkets. The analysis considers each competitor's product range, pricing, branding, and market positioning. The paper concludes that while Starbucks represents the most significant direct threat, The Bean's on-base location provides a meaningful competitive advantage that can support a viable market entry.
- Introduction to Competitive Analysis: Defines competitive analysis framework for The Bean
- Direct Competitors: Starbucks and Doutor Coffee: Profiles Starbucks and Doutor as primary rivals
- Independent Coffee Shops and the Kissaten Tradition: Examines local Japanese independent coffee shops
- Substitute Products: Retail and Convenience Coffee: Analyzes ready-to-drink and supermarket coffee competition
- Indirect Competitors: Cafes, Bars, and On-Base Facilities: Considers social venues and on-base refreshment options
- Conclusion: Competitive Positioning for The Bean: Asserts location as The Bean's key advantage
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What makes this paper effective
- The paper applies a clear three-tier competitive framework — direct competitors, differentiated competitors, and substitute products — giving the analysis logical structure and completeness.
- Specific product details (drink sizes, flavored syrups, pricing in yen, branded product names) ground the analysis in concrete market evidence rather than vague generalizations.
- The paper consistently links competitive observations back to implications for The Bean, keeping the analysis purposeful and applied rather than purely descriptive.
Key academic technique demonstrated
The paper demonstrates applied competitive analysis grounded in Mintzberg et al.'s strategic management framework. By categorizing competition into direct, differentiated, and substitute types, the author shows how theoretical models can organize real-world market research into actionable business intelligence — a core skill in strategic management coursework.
Structure breakdown
The paper opens by defining competitive analysis and its categories, then moves systematically through each competitor type: Starbucks (premium direct competitor), Doutor Coffee (mid-market direct competitor), independent kissaten (differentiated local competitors), retail/convenience coffee (substitute products), and broader social venues (indirect substitutes). It closes by asserting The Bean's location-based competitive advantage as its key differentiator.
Introduction to Competitive Analysis
Before opening a coffee shop called The Bean at Yokosuka Naval Station, Japan, it is necessary to consider the competitive environment. A competitive analysis examines the competition that exists within the proposed market. This requires the identification and consideration of the types of firms and products that The Bean will need to effectively compete with if the venture is to be successful.
Competition may be divided into different categories. The first category is direct competition: firms seeking to compete in the same market with the same, or a very similar, product. Firms competing for the same market with a differentiated product also provide competition. Additionally, companies that offer a different product but satisfy the same customer needs — known as substitute products — must also be considered (Mintzberg et al., 2011).
Direct Competitors: Starbucks and Doutor Coffee
As The Bean will provide an American coffee shop experience, the most direct competition comes from firms offering a similar experience, particularly Starbucks and Doutor Coffee.
Starbucks is a well-known, iconic U.S. brand with a strong presence in Japan, having entered the market in 1995 (Schultz, 2011), with a café in Yokosuka since 2004 (Montgomery, 2004). Starbucks offers a range of gourmet coffees that are roasted and ground in-house. Products include lattes, cappuccinos, and espressos, all of which can be customized to personal tastes with flavored syrups such as caramel, vanilla, and hazelnut (Starbucks, 2014). Drinks may also be customized with different types of milk, including soy milk, and are offered in three sizes for both dine-in and takeaway (Starbucks, 2014). The menu also includes teas, hot chocolate, chilled blended drinks marketed as Frappuccinos, and bottled beverages, along with complementary food items such as sandwiches, biscuits, and cakes (Starbucks, 2014). The firm is strongly differentiated through its well-recognized brand name, supported by a high level of marketing. As a premium brand, it competes not only on product quality but also by providing a premium coffee-drinking experience in comfortable surroundings, with additional services such as free Wi-Fi (Starbucks, 2014). Starbucks is a formidable competitor that is already established with a franchise in Yokosuka.
Doutor Coffee is another large coffee shop company in Japan, with several outlets in Yokosuka. The company specializes in roasting coffee and operates a large number of franchise coffee houses offering a European coffee house experience through its Excelsior Café chain and Doutor Gourmet Coffee Shops. Doutor Coffee is an important competitor not only because several of its chain outlets are located in Yokosuka, but also because it is a significant player in the Japanese market, with more than 900 branches nationwide and a listing on the stock exchange. Its growth strategy has been similar to Starbucks, relying on the franchise model (Doutor Coffee, 2014). The firm offers a smaller range of drinks compared to Starbucks but also seeks to provide a comfortable experience with relaxed seating. Coffee and other drinks, along with complementary items, can be consumed on the premises or taken away. Notably, the takeaway cups have a cheaper feel, as they are made of polystyrene. Customers who dine in will find themselves in an environment where smoking is permitted — a point of differentiation from Starbucks (Lewis, 2003). The Doutor Gourmet Coffee Shops are more upscale than the Excelsior Café chain, which features a bright and vibrant interior design. The cafés are positioned toward the middle market in terms of both location and pricing.
Independent Coffee Shops and the Kissaten Tradition
There are also independent coffee shops, known locally as kissaten, which tend to offer a more limited selection of coffee products but also serve tea, including the popular green tea. Independent stores generally have lower prices and may range from small shops with limited seating to patisserie-style outlets offering a wide variety of cakes and snacks. Some of these establishments have been operating for generations, while others are newer. Most provide a more distinctly Japanese experience, and the quality of these stores can vary greatly.
Conclusion: Competitive Positioning for The Bean
The most direct competition for The Bean comes from Starbucks, located in Yokosuka, followed by Doutor Coffee and independent coffee stores. While the products and service offered by these competitors may be similar, Starbucks does not hold the location advantage that The Bean will have on the naval base. This on-base positioning represents a significant competitive advantage and is likely to be central to The Bean's success in the market.
References
Doutor Coffee. (2014). Retrieved from http://www.doutor.co.jp/
Lewis, L. (2003, November). Japan's coffee kings and the Starbucks effect. Japan Inc. Retrieved from http://www.japaninc.com/article.php?articleID=1218
Mintzberg, H., Ahlstrand, B., & Lampel, J. B. (2011). Strategy safari: The complete guide through the wilds of strategic management. Financial Times/Prentice Hall.
Montgomery, N. (2004, March 31). Starbucks' debut perks up Yokosuka. Retrieved from http://www.stripes.com/news/starbucks-debut-perks-up-yokosuka-1.18263
Ornette. (2009). UCC Evangelion coffee is back for 2.0. Retrieved from http://www.evageeks.org/2009/05/ucc-evangelion-coffee-is-back-for-20/
Starbucks. (2014). Retrieved from www.starbucks.com
UCC. (2014). Retrieved from http://www.ucc.co.jp/eng/
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