Competition
Now Viewing Starbucks's competition in: Coffee and Tea Manufacture
Recent Developments
Tea May Reduce Risk of Stroke - Drinking three cups of black or green tea per day is associated with a 21 percent reduction in risk of ischemic stroke, according to an American Heart Association Study. The study did not include herbal teas, or tisanes. Researchers compiled data from nine stroke studies drawn from China, Japan, Finland, the Netherlands, Australia, and the US. The study, likely to be used to bolster tea marketing efforts, was sponsored by the Lipton Institute of Tea.
Expensive Coffees Score Lower in Tests - Despite costing less than half as much as some high-end brands, Eight O'Clock coffee scored highest in tests by Consumer Reports magazine. Eight O'Clock, which is owned by Tata Tea Group, topped offerings from companies such as Starbucks and Peet's. All the coffees tested were made with Colombian beans and were rated on qualities such as flavor and aroma. Results were published in the magazine's March 2009 issue.
Coffee, Tea Imports Rise - US coffee and tea imports were up more than 12 percent in 2008 over 2007. Countries whose exports to the US rose the most included Colombia (39 percent), India (24 percent), and Switzerland (20 percent). Exports from Indonesia dropped 37 percent and from Malaysia 9 percent.
Competitive Landscape
Consumer taste and population growth drive demand in the consumer sector, while economic growth of businesses, like restaurants and hotels, drives demand in the commercial sector. The profitability of individual companies depends on effectively managing raw ingredient costs, efficient operations, and effective marketing. Large companies have scale advantages in purchasing, distribution, manufacturing, and marketing. Small companies can compete effectively by offering specialized products or serving a local market. The industry is capital-intensive: average annual revenue per worker is about $500,000.
Coffee and Tea Manufacture Industry Forecast
from Hoover's/D&B subsidiary First Research
The output of US coffee and tea manufacturing is forecast to grow at an annual compounded rate of 2 percent between 2008 and 2013. Data Sourced: December 2008
Coffee and Tea Manufacturing Growth Improves Slowly
First Research forecasts are based on INFORUM forecasts that are licensed from the Interindustry Economic Research Fund, Inc. (IERF) in College Park, MD. INFORUM's "interindustry-macro" approach to modeling the economy captures the links between industries and the aggregate economy.
First Research Industry Growth Rating
The First Research Industry Growth Rating reflects the expected industry growth relative to other industries, based on INFORUM's forecasted average annual growth for the combined years of 2009 and 2010.
- Demand: Partly driven by consumer income
- Need expertise, good marketing
- Risk: Slow economy limits spending on non-essentials
Industries Where Starbucks Competes
- Leisure
- Restaurants & Cafes
- Specialty Eateries (primary)
- Restaurants & Cafes
- Beverages
- Food
- Retail