Starbucks Expansion into Sri Lanka: Strategy & SWOT Analysis
This paper evaluates the potential expansion of Starbucks into Sri Lanka by first establishing company background and tracing the brand's growth from a single Seattle coffee shop in 1971 to a global chain operating in over 50 countries. The paper details the leadership role of Howard Schultz in shaping Starbucks' identity and navigating periods of decline. A SWOT analysis framework is then applied to assess the company's internal strengths and weaknesses alongside external opportunities and threats relevant to entering the Sri Lankan market. The analysis provides a foundation for strategic recommendations regarding resource acquisition, staffing, franchise considerations, and competitive positioning in a new international context.
- Introduction: Overview of expansion planning considerations for Starbucks
- Company Background: Starbucks' founding and global growth to 17,000 outlets
- Howard Schultz and the Growth of Starbucks: Schultz's leadership, expansion vision, and turnaround strategy
- SWOT Analysis: Strengths, weaknesses, opportunities, and threats for Sri Lanka entry
- Conclusion: Strategic recommendations for entering the Sri Lankan market
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What makes this paper effective
- The paper grounds its strategic analysis in concrete company history, giving the SWOT framework real context rather than treating it as an abstract exercise.
- The chronological narrative of Starbucks' growth — from a single store to 17,000+ outlets — clearly illustrates how organic growth and franchising shaped the brand's international capabilities.
- The paper identifies a real-world setback (the 2007–2008 decline) and the subsequent turnaround, demonstrating critical thinking about company resilience rather than presenting only positive evidence.
Key academic technique demonstrated
The paper uses the SWOT analysis framework as a structured bridge between descriptive company background and prescriptive strategic recommendations. By building the SWOT on established historical evidence, the student demonstrates how analytical frameworks should be anchored in verifiable facts rather than applied generically.
Structure breakdown
The paper opens with a brief framing introduction that sets out the expansion rationale. It then moves through company background (founding and early history), a focused narrative on Howard Schultz's role in growth and recovery, and a SWOT analysis section assessing Starbucks' position relative to the Sri Lankan market opportunity. The structure follows a standard business report format appropriate for an undergraduate international business course.
Introduction
The expansion of any company requires careful consideration. An expansion plan must account for a number of factors, including conditions in the target country, the company's resource acquisition needs, and staff training requirements. The plan should build on the organization's strengths, capitalize on available opportunities, and minimize the risks arising from weaknesses and threats. In order to assess how Starbucks might expand into Sri Lanka, it is first necessary to examine the company itself before considering the mechanics of expansion.
Company Background
Starbucks is a global brand of gourmet coffee shops. Beginning with a single store at Pike Place in Seattle in 1971, the company has grown to operate in 50 countries with more than 17,000 outlets, expanding through both organic growth and the franchise model (Starbucks, 2014). Approximately 50% of stores are owned by franchisees (Starbucks, 2014).
The company's rapid growth was driven by Howard Schultz, who took over the firm from its original owners. Schultz joined Starbucks in 1982 as Director of Retail Operations (Starbucks, 2012). At the time he joined, the company had already been successful for more than a decade, with a focus on roasting and selling coffee beans (Schultz, 1998). Schultz recognized significant potential for expansion, and after a business trip to Italy in 1983, he became convinced that the espresso bar model he had observed there would serve as a strong basis for growth (Schultz, 1998).
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