The Starbucks Organic Growth Plan

Starbucks is currently growing based on a non-organic growth plan. This means that Starbucks has outgrown their current business model. So, the only way for Starbucks to grow further, is by simply opening more locations. Have you ever wondered why you see Starbucks on every corner of every street? Ok, that might be a bit of an exaggeration, however, it seems as though the company is headed toward this direction.

During the early Starbucks years the companies growth strategy was built around the theme of a quaint coffee bistro. The plan was grow the menu and create value by introducing a comfortable atmosphere. Starbucks has done this very well. So well in fact that the company has completely fulfilled this strategy leaving directors scrambling to find growth anywhere possible to satisfy shareholders.

Now Starbucks is looking in another direction to satisfy shareholders. But is this really satisfying shareholders? The answer is no. When investors see non-organic growth they tend to look in another direction with their investment dollars in hand. Investors want to see a company with the ability to grow profits organically and intelligently. Why? Because growing a company with a non-organic strategy will not be sustainable in the long run.

Shareholders will come to see a share price of Starbucks considerably lower if the company continues down this path. Starbucks directors must consider a method of growing the business within the business to create sustainable growth and fulfill shareholder expectations. This would mean either expanding the menu, services offered or by finding another niche market to break into. This addition of this niche market would have to incorporate the current business model of Starbucks, however. Until then, don't expect too much out of the coffee giant.