THE RESUMPTION OF WHALING BY NORWAY A Paper By Bryan Togias Introducti

THE RESUMPTION OF WHALING BY NORWAY A paper by Bryan Togias Introduction The accompanying paper is about the resumption of whaling by Norway with an emphasis on the American mentality towards whaling as a rule. Whaling is a delicate issue for some, individuals, including myself. There are numerous individuals who feel that whales are profoundly clever well evolved creatures, much the same as mankind from various perspectives. They refer to the way that whales mate forever, the size of the normal whales cerebrum, and the proof that whales speak with each other ; these characteristics they share with us. The counter whaling individuals feel that to execute whales for their meat or oil, would resemble slaughtering individuals for their meat or oil. The ace whaling individuals don't accepting any of their thinking. The genius whaling individuals feel that it is their entitlement to utilize their assets any way that they need, and nobody can instruct them. These individuals don't feel tha t whales are keen or that the size of their cerebrums has anything to do with it. The individuals of Norway don't see an issue with whaling on the grounds that they were raised w ith it. The counter whali A universal investigation by Milton Freeman and Stephen Kellert, distributed in 1992, reviewed individuals in 6 significant nations including Australia, Germany, Japan, Norway, The United Kingdom and The United States about their perspectives towards whales and whaling. 57% of the US respondents affirmed that they restricted the chasing of whales under any conditions and 55% felt that even directed whaling must be deserted (Skare 1994). Albeit none of the respondent gatherings demonstrated a significant level of information regarding the matter, all appeared to concur on the accompanying focuses. 1. The security of whale natural surroundings from contamination and aggravation. 2. Keeping up a biological system viewpoint in whale the board. 3. Putting together gather levels with res pect to the most solid logical counsel accessible. In Norway where whale chasing was at one time a major industry the defenders of whaling laugh at the possibility of a world without whaling. Norway guarantees that whaling in their nation goes back in excess of ten thousand years (Skare 1994) and that history, they guarantee, gives them the option to misuse the assets that they have accessible to them; what they don't state is that those assets aren't generally their own to abuse. Eric Doyle, an individual from Greenpeace, a natural guard dog gathering, disclosed to me (via phone) that the limits that nations draw up don't mean anything to whales or even to whaling pontoons in certain cases. Doyle, clarified that since Norway is one of the not many nations that have continued whaling ,their pontoons aren't firmly watched, and are regularly disregarded in light of the fact that there aren't a large number of them out there (Doyle 1995). Norwegians who are associated with whaling, cha se Minke whales in the upper east Atlantic, where the whale stock is assessed to comprise of roughly eighty-6,000 700 minke whales (Donovan 1994). In the late eighties Norway forced a restriction on itself that finished whaling, monetarily, whaling with the end goal of logical research, anyway proceeded forever. The History of The Regulated Whaling Industry... Whaling has consistently been a wellspring of salary and, whales an interminable wellspring of helpful items. The meat for our weight control plans, the oil to grease up our vehicles and bikes, the lard to make cleanser, cleanser, and numerous different items too various to even consider mentioning (Skare 1994). Anyway with the creation of manufactured oils and the thought of solid living on our psyches; the normal American has little communication with whale items. This reality has established the fundamental body of the counter whaling contention, as though to state, in the event that the Americans can live without whaling, at that point every other person can as well. In nineteen-twenty six, the League of Nations made a subcommittee to administer and direct the developing whaling industry; however it was not until nineteen forty-six that a working administrative advisory group was built up. At the activity of the United States, the International Convention for the Regulation of Whaling (ICRW) was embraced by the League of Nations. The ICRW called for such a working board of trustees, and hence the International Whaling Commission (IWC) was made. ICRW was expected to protect and control

Exam2 Assignment Example | Topics and Well Written Essays - 1250 words

Exam2 - Assignment Example Around then, the lease would be $ 10000 every month. The following inquiry which emerges is that, regardless of whether the whole measure of $ 4000000 would be given from inside wellsprings of financing or an outside advance ought to likewise be taken. On the off chance that outside advance is taken, at that point it would be acquired to a measure of $ 2000000 having an enthusiasm of 5% every year. In the event that the structure is developed in 2017, at that point the gathered measure of $ 4000000 can likewise be contributed and an enthusiasm on such venture @ 3.5% would be acquired. The expense of the structure would likewise be increasing by 2.5% every year. Degree of profitability has been determined by thinking about that the loan fee on the venture of $ 4000000 is 3.5%. Question 1 Return on Investment Particulars Amount (in $) Invested Amount 4000000 Return on Investment for the year 2013 (from October to December) 35000 Return on Investment for the year 2014 140000 Return on I nvestment for the year 2015 140000 Return on Investment for the year 2016 140000 Total Return on Investment 455000 Return on Investment (in Percentage) 11.375% The arrival on speculation is an exhibition measure that is utilized for assessing the productivity and precision of any venture (Megginson and Scott, 2008). It is a successful execution estimating apparatus, which helps in taking fitting choices by the organization (Rachlin, 1997). It helps in staying away from imperfections in the administrative choices taken by any organization. On the off chance that the amassed measure of $ 4000000 is contributed, at that point a yearly premium @ 2.5 percent would be earned each year till 2017. The premium earned in the first year is 35000 and the premium earned in next three years is $ 140000 every year. All out premium earned is $455000. Rate of profitability is 11.375%. Question 2 Inflation rate is depicted as the consistent increment in the value level of merchandise and enterprises. It is determined as the yearly rate rise. Findlay is the name of a city in Ohio, United States. The Inflation pace of United States, as anticipated by International Monetary Fund, has been demonstrated as follows: (International Monetary Fund, 2012) Within the timeframe of 2014 to 2018, the expansion rate as evaluated by the Personal Consumption Expenditure Price Index would ascend somewhat and afterward it would stay steady at a pace of 2 percent (CBO, 2013). Assurance of the anticipated yearly expansion pace of Ohio is likewise essential. ‘The Ohio Department of Transportation’ has assessed the Inflation Rate of Ohio to be: High Most Likely Low 2013 8 % 5.7% 3% 2014 10% 5.5% 3.5% 2015 8.95% 5.9% 3.5% 2016 7.5% 4.5% 1.5% 2017 7% 4% 1% Question 3 It has been expressed that the estimation of the structure would be expanding by 2.5 percent consistently beginning from 2014. The augmentation has been appeared in the accompanying table: Particulars Amount (in $) Present est imation of the structure 4000000 Value of the structure in 2014 4100000 Value of the structure in 2015 4202500 Value of the structure in 2016 4307562.5 Value of the structure in 2017 4415251.56 Net Increase 415251.56 It can be seen from the previously mentioned table that the estimation of the structure expanded yearly. The estimation of the structure in 2014 expanded to $ 4100000. It expanded to $ 4202500 in the year 2015. In the year 2016, the worth expanded to $ 4307562.5 lastly in the year 2017, the worth expanded to $ 415251.56. Question 4 Option 1 Paying the entire sum from the inner wellsprings of financing

5th of November, Remembered

5th of November, Remembered Just finished reading Pauls entry about the Guy Fawkes hacks at MIT and feel obligated to write about 5th of November/Guy Fawkes/Bonfire Night over here at the other Cambridge. I actually saw V for Vendetta without knowing about Bonfire Night. Not very meaningful this way at all. But I found out all about Guy Fawkes and Bonfire Night during my Chinese class last week (in Chinese, of course). I didnt see any masks over here but there there is an annual carnival+fireworks+bonfire event that I felt compelled to go. So after eating dinner at my college, I headed over to Midsummer Commons along with a sea of people. I was worried that I wont know how to get there but no worries because everyone else was going! The streets were so packed with people that cars and bikes had a lot of trouble getting through. It really looked like the whole town showed up for these fireworks. The fireworks themselves lasted for about 20 minutes and were pretty cool. Cant be compared to fireworks during New Years but it was cool nevertheless. Here are some pictures courtesy of a couple of other MIT students, Maria and Xin: People and more people Explosions, yay! And the bonfire, of course. Tea, coffee, and chips Besides these fireworks, there have been various smaller fireworks going off all night long. You can buy fireworks at the local grocery store! Some colleges held their own fireworks last week.

Why Do People Get Married What Do Marriages Stand For...

Why do people get married? What do marriages stand for? Marriage is a union between two people who wish to unite their life together. The reason that people today get married is for love. However, marriage means more than love. A reason why many people get married is that they have found companionship, love, and comfort in another person. The idea of a marriage has different meanings to people. Some marry for money, love or resources. In modern times, many philosophies have changed throughout the year. In her book marriage, Juliet H severance states that  ¨marriage institution claim that it offers the best possible opportunity for individual and collective happiness†¦Ã‚ ¨(severance 3) Marriage is a way to achieve happiness. Many ideas of marriage have changed. However, some ideas and still exist. Marriage is a form of motivation, regardless of their reasons. The reason people get married is mainly love, money, and traditions. The first major reason for the existence for marri age is love. Modern marriages take love as their prime factor. So many ask what love is? Love is caring deeply about another person, it seems impossible to be without them. The ideology allows people from different social classes, religions, genders and races to be united without any opposition to their relationship. Mostly people marry when they find a person who is a friend, protector, supporter and a lover. Love cannot be explained since it has many meanings, but in marriage, it allows people toShow MoreRelatedWhy Do People Get Married? What Does Marriage Stand For? Marriage?918 Words   |  4 PagesWhy do people get married? What does marriage stand for? Marriage is a union between two people who wish to unite their life together. The reason that people today get married is for love. However, marriage means more than love. A reason why many people get married is that they have found companionship, love, and comfort in another person. 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Its clear purpose is the begetting of children and mutual companionship and help. Virginity however, is the preferred state in Catholic belief. The primary purpose of marriage is to fulfill a vocation in the nature of man and woman, forRead MoreHomosexuals Have Every Right to Marry686 Words   |  3 PagesHomosexuals have every right to marry. Marriage is a basic human right, if straights can marry in all states then so should gays. Gay rights of all kinds are starting to become increasingly protected. â€Å"In every courthouse, in every proceeding and in every place where a member of the department of justice, stands on behalf of the United States, they will strive to ensure that same-sex marriages receive the same privileges, protections and rights as opposite-sex marriages, under federal law.† -Attorney GeneralRead More Relationships and Marriage - Dont Marry!1494 Words   |  6 PagesDont Marry! Marriage is quite likely the one most damaging force our species have ever invented, up to and including war. Harold Christensen, author of Marriage Analysis, is not the only person who believes marriage is in many ways hogwash. To borrow a phrase from the 1980s, young women simply have to say no to marriage. Not only is it unnecessary, but a bad habit as well. We young women who are now at the age for which marriage becomes a regular topic of conversation need

How Will The Frontier Be Affected By A Positive Change

Question One a. Why is the PPF concave to the origin? The production possibilities frontier is concave to the origin as it represents the increase opportunity goods along with the outputs of goods which is increasing. This is due to the law of opportunity goods – with one increase or production, an increase in opportunity costs follows (Layton, Robinson and Tucker, 2016). b. How will the frontier be affected by a positive change in technology for the product on the horizontal axis? The points represented on the production possibilities frontier represent the maxim outputs of each product (Layton, Robinson and Tucker, 2016. The amount of tables produced each year is presented on the vertical axis’s and the amount of chairs produced each†¦show more content†¦Elasticity is not confined to demand curves as the demand of a product consumed is not always related to the price of the item. For instance the demand of meat products may be high during holiday seasons, while the price is the same throughout the year and vice versa. b. The demand for a product is price elastic and the product s price is decreased by X%. What might be the expected change in quantity demanded and revenue? If a product is price elastic and the price decrease this will result in more people purchasing the product and therefor the revenue will increase. This is because more people are going to purchase the product in higher quantities if they see it at a cheaper price. For instance supermarkets often promote price dropped items, at a new cheaper price, this means more people are likely to buy that brand of product as opposed another that is a higher price – resulting in a higher revenue for the product (Layton, Robinson and Tucker, 2016). Question Four a. Explain why profits are maximised when MR = MC. Profits are maximised when market revenue = market cost because the amount of product being produced is equal to the cost of producing the output. If marginal revenue was left then marginal cost, this would be the cost of producing the output was less than the revenue, causing the profit to lower (Layton, Robinson and Tucker,Show MoreRelatedTrade Liberalization Can Boost Productivity By Inducing A Better Allocation Of Production Factors1436 Words   |  6 Pagesfaster technical change not only innovation but also adoption of new technologies. Bloom et al. (2011) discover that the absolute volume of innovation (not just per worker productivity or patents) increases within firms and industries more affected by exogenous reductions in barriers to the country’s imports. The following three problems were discussed by Bloom et al. (2011). 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Tesco Descriptionin Strategy Free Essays

Tesco is one of the organizations who have good corporate level strategy to analyze and deal with potential risk. In the case study of Tesco, they tend to expand their Asian market through alliances with the local retailers. The managements believe that this strategy can lead a good development in current resources and competence. We will write a custom essay sample on Tesco Descriptionin Strategy or any similar topic only for you Order Now The type of goods, services and environment demanded by consumers indicate the culture of the country and it can predict their consequent attitudes and beliefs. By entering into joint ventures, Tesco can know more about the local knowledge from their partners and improve their supply chain, product development and stores operations skills to deliver a better shopping experiences and environment to customers. Social culture play an important role in business growth rate, the managements of Tesco realize it and develop strategy to cope with it. Tesco also mentioned that the success of partnerships can depend on three main factors, which are sustainability, acceptability and feasibility. Sustainability can refer as whether the strategy addresses the situation under the operating of company. The acceptability is related to the expected outcomes, level of risk and the reaction of stakeholder. Feasibility is focus on the abilities and resources that are needed when carry out the strategy. Another corporate strategy that implemented by Tesco is diversification. According to Johnson and Scholes (2003), they believe that when the business environment change, it is necessary for an organization to create new products and services in order to consolidate their market (as cited in Ivory Research, 2009). The top managements of Tesco have to take this strategy seriously, because changing not only can strengthen their competence but also can make thing worst. Diversification need to implement in the right way and right time. For the case of Tesco, they are trying to design different store formats from other hypermarket. This will be the uniqueness of Tesco in that country because it will fulfill the needs of customer that cannot get from other hypermarket. Besides that, the management of technological innovation is highly involved in strategic decision making. Tesco have to minimize their internal weaknesses and strengthen internal superiority. How to cite Tesco Descriptionin Strategy, Papers

Starbucks Case Study Essay Example

Starbucks Case Study Essay Conner A Intro to Business 3/26/2013 Case Study Consumer Behavior in the Coffee Industry Did you know one franchise alone dominated an entire payment-processing market in just one year? You might have heard of this giant company by the name Starbucks. Howard Schultz, CEO of Starbucks, had a significant role in the company’s growth. Starbucks has steadily dominated the coffee market and has even extended to being a 3rd home for many of its consumers. Based in Seattle, Starbucks had significant competition when it opened its first store in the Pike Place market in Seattle, yet still managed to become superior. Starbucks used new advertising tactics and presented a unique experience for its customers, all of which was a game changer in the business world. Starbucks was created when three friends opened a small store to sell coffee beans and roast in 1971[1]. Jerry Baldwin, Gordon Bowler and Zev Siegl opened their store in the heart of the unique open air market in downtown Seattle. Located just off the harbor, Pike place market was the optimal location and attracted many residents and tourists. After ten years of incredible growth, Jerry Baldwin hired Howard Schultz as head of management. When Schultz first started, he slowly learned the coffee industry and helped made subtle but significant changes. For example, Schultz noticed that â€Å"first-time customers sometimes felt uneasy in the stores†[2] so he developed â€Å"customer-friendly sales skills and produced brochures that made it easy for customers to learn about fine coffees†2 Schultz had the vision of making Starbucks a coffee lounge versus a bar after being inspired by eastern traditions. We will write a custom essay sample on Starbucks Case Study specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Starbucks Case Study specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Starbucks Case Study specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Even though he did not agree with the new direction, Baldwin allowed Schultz to open one espresso bar and in 2 years, Schultz was able to buy out Baldwin and equity owners with the help of investors in 19921. Howard Schultz initially saw the power of consumer behavior early on when he realized Starbucks began to be a social gathering mecca for people instead of just an espresso stand. When Schultz first noticed the ‘seismic change in consumer behavior,’ he adopted a free-Wi-Fi service and mobile payment service and noticed that Starbucks began to attract people as if it was a third home for coffee enthusiasts. Although he jokes about not getting rent from consumers, it allowed Starbucks to create an online-experience in their ‘3rd home’ which was unique to the coffee scene in the United States. With scheduled deliveries and privatized ad networking, Starbucks was maximizing its profits and allowing an experience for coffee enthusiasts that did not make them feel locked-into paying. This shift in consumer behavior was in response to the cultural need for a place between home and work. As social beings, humans thrive for an excuse to hang out and socialize or participate in a community environment. This amazing experience that Starbucks supplied needed to be fine-tuned like any business plan. Like any business, Starbucks had challenges, such as their management of spending. In an interview entitled Business Brilliant, Schultz said that too much was focused on the customer instead of the infrastructure. To improve this, Schultz developed a unique experience in the store with the paired pastry-drinks and released free Wi-Fi for customers. In addition to free-Wi-Fi, mobile payments allowed consumers to avoid lines and continue their private work in the confines of the lounge. Soon Starbucks was thriving and announced that â€Å"the opening of 150 new stores in five years significantly exceeded the 1987 business plan’s objective of 125†[3]. Like every company, Starbucks faced unique issues in their business which slowed down growth initially which in effect slowed down growth in the long run. Schultz attributed the biggest hold-back in the long run to not investing in the supply chain, technology or manufacturing. Although Starbucks was marketing their franchise extremely well, they did not invest ahead of the growth curve and the infrastructures became under-par. In the Business Brilliant, Schultz candidly admitted that Starbucks â€Å"solely accelerated growth of the company. † Moreover, Schultz said the issue was that Starbucks â€Å"needed competency well beyond the size of the company and needed the kind of capability they didn’t have. † Since their infrastructure’s efficiency in the short run was hindered by technological limitations coupled with access to capital, the entire store chains needed to be shut down. Schultz defined the event as a need to redesign their image and retrain their employees. Starbucks was losing grip on the customers and their loyalty because the experience of Starbucks was losing its unique features. All of these internal and external issues that Starbucks was facing were all connected with values and company image according to Schultz. Schultz was so specific with the Starbucks experience that when he smelt burning cheese in a store he decided to ask the workers and they told him â€Å"So what, profits are up! † Soon after this, Schultz decided to close down and retrain all stores and employees. He sent out a press release admitting that Starbucks was misrepresenting itself. Although no one had accused or criticized Starbuck’s prior to his declaration, it was a bold move which negatively impacted the financial strength of the Company. However, the action proved loyal to the consumer and enhanced brand loyalty for Starbuck-addicts. This root issue of misrepresentation in the Starbuck’s experience and the company vision was so significant to Schultz that he needed rework his company from the ground up. This road block of ‘conserving the core businesses’ and ‘pushing for relevant innovation’ made Schultz tweak and adjust the Starbucks experience constantly but effectively. While Schultz attributes the root issue for Starbucks to be company image and adapting core values, could it be possible that the vision and image were not correctly portrayed because of unwise funding? Schultz does admit the funding issues contributed to the core issue of misrepresentation of company image and values, but he does not see the two issues in separate environments. Schultz assigns the core issue to misrepresentation and the surface symptoms to be funding. However, more funding or a different funding plan with more focus in infrastructure would have changed the outcome. The core issue was funding and the symptoms of the core issues were misrepresentation because of resource allocation. While their short term fixed costs of infrastructure and labor were solved, their reserved and recurring allocation towards the upgrades of their infrastructure lacked significantly. If properly funded before and seen ahead of the curve, their growth could have been anticipated. This is evident through the need to shut down and retrain employees. It’s clear that the total fixed and variable costs exceeded their revenue initially. Like all companies, there was a start-up curve but when the curve was dealt with, resource allocation was not the focus. The best plan of action ideally would start with addressing resource allocation. Starbucks was able to stay in business and have great growth so it’s clear the management was able to properly allocate their average variable costs and fixed costs for the most part. Nevertheless, it would have been best if the costs were optimized and revenue was set aside for changes in infrastructure. Funding should have been directed at things which would have produced stability in the long run. This would have lowered their total costs and properly funded their infrastructures for the long run and short run. Schultz should have looked at the management immediately after buying out the company and properly hired people with skills that would be able to guide Starbucks through significant growth. Investment in infrastructure to avoid long-term costs would have saved Starbucks from funding issues at later times. In addition to optimizing their infrastructure for the long run, Starbucks needed to invest more in manufacturing and supply chain for the success in the long run. For example, Starbucks should have initially allocated more funding towards small upgrades in their infrastructure such as ovens versus microwaves to avoid unpleasant scents in the customer’s experience. This also connects to Schultz’s emphasis on hiring employees and affiliates based on similar values. If the decision to hire those employees would have initially been more focused on similar values in addition to management skills, the variable costs to upgrade the infrastructure in the long run would have been lower because the management would have been more motivated to deal with the issue before the CEO had to see the symptoms. Finally, the management of Starbucks needed to choose their employee’s more wisely from the start. If Schultz would have chosen his employee’s based on the similarity of their values and the company vision, little issues such as smell in the customer’s experience would have been dealt with more efficiently. This connects to optimizing their infrastructure but focuses on the employees instead of the technology. It’s important to treat both with separate solutions because Schultz reminded us that the employees can only work with the assets they are provided with. This small change in the focus of the start-up of the company could benefit the image of Starbucks very efficiently and in a cost-productive way. Schultz jokes about not getting rent from Starbucks admirers yet he also notes that the potential to plug into the social media of the internet and create the environment was more beneficial than the issue of customers hanging out inside the store. The evolving Starbucks experience caused consumers to have incredible brand loyalty over alternatives such as Pete’s Coffee and Tea and Tullies. Yet the quick and agile response of technology was exactly what Starbucks needed to put it ahead of the ‘growth curve’ in social media while its competitors struggled behind. Schultz’s solutions were effective in the short run but he still realized his long run potential was limited by resource allocation. The problem with Starbucks and consumers was not the shift in demand for coffee consumers but it was resource allocation and initial planning. Howard Schultz’s plan of action was headed in the right direction apart from the minor mix-up between the surface symptoms and the core issue. In addition to new work practices, Schultz integrated new management and had to let go many of the people he knew were limited to the knowledge of the short-term. This new resource allocation towards what Schultz called ‘the backside’ of the company, allowed the company to finally resolve its funding and allocation issues. The new plan of action consisted of hiring new employees and investing in infrastructure to anticipate growth and new forms of technology; the poor management habits of the past from would not hinder Starbucks in the future. Similar to my suggested plan of action, Schultz’s initiative consisted of new employee’s, new technology and investing in the short term. If Schultz’s would have put more funding towards infrastructure to bring stability in the long run, he would have been able to manage the shift in consumer behavior and maintain profit without the need to close down the stores for retraining. The issue for Starbucks is not losing customers but how to accurately represent the company’s values. Moreover, if the employees were chosen correctly and the infrastructure was properly optimized, Schultz plan would have worked perfectly. All in all, every company in any industry is going to face challenges and have limited resources to meet them in an efficient manner. Howard Schultz used the resources he had to best manage Starbucks and handled the big issues he had efficiently and creatively. The future of Starbucks all depends on its management and commitment to adhering to the company vision and values. After experiencing the 2000-2008 period, one can see that the values will inevitably shift with changes in management. 4] The future of Starbucks is highly dependent on how long Howard Schultz continues to be an active part of the company and in shaping its vision. If affiliates and employees are chosen intelligently and have values matched properly with the company’s mission, Starbucks’s vision should be passed down effectively through each generation of new management. Nevertheless, the rise and fall of competitors in a market is inevitable and time will tell if Starbucks will eventually be surpass ed by a competitor. Starbucks will be a primary educational focus for many business programs. It is one of the best managed franchises in history and will remain one of the most successful for a long period of time. Like any business, Schultz received criticism for extreme responses yet these responses excelled the growth of the company. Much like my suggestions, Schultz acted quickly and made extreme changes which were crucial to repairing the infrastructure. Unlike most companies, Starbucks’s major focus is promoting the company image and values instead of putting profits first. Works Cited I. Schiff, Lewis. Starbucks CEO Howard Schultz Coming to NYC. Inc. com. INC, 18 Mar. 2011. Web. 25 Mar. 2013. II. Starbucks Corporation History. History of Starbucks Corporation – FundingUniverse. Funding Universe, n. d. Web. 25 Mar. 2013. III. McGraw Hill. Starbucks Corporation. Starbucks Case Study. MHHE. com, n. d. Web. 25 Mar. 2013. [1] Funding Universe, Starbucks Corporate History [2] McGraw Hill, Starbucks Case Study, Starbucks Corporate History [3] McGraw Hill, St arbucks Case Study, Starbucks Corporate History [4] Funding Universe, Starbucks Corporation History Starbucks Case Study Essay Example Starbucks Case Study Essay Conner A Intro to Business 3/26/2013 Case Study Consumer Behavior in the Coffee Industry Did you know one franchise alone dominated an entire payment-processing market in just one year? You might have heard of this giant company by the name Starbucks. Howard Schultz, CEO of Starbucks, had a significant role in the company’s growth. Starbucks has steadily dominated the coffee market and has even extended to being a 3rd home for many of its consumers. Based in Seattle, Starbucks had significant competition when it opened its first store in the Pike Place market in Seattle, yet still managed to become superior. Starbucks used new advertising tactics and presented a unique experience for its customers, all of which was a game changer in the business world. Starbucks was created when three friends opened a small store to sell coffee beans and roast in 1971[1]. Jerry Baldwin, Gordon Bowler and Zev Siegl opened their store in the heart of the unique open air market in downtown Seattle. Located just off the harbor, Pike place market was the optimal location and attracted many residents and tourists. After ten years of incredible growth, Jerry Baldwin hired Howard Schultz as head of management. When Schultz first started, he slowly learned the coffee industry and helped made subtle but significant changes. For example, Schultz noticed that â€Å"first-time customers sometimes felt uneasy in the stores†[2] so he developed â€Å"customer-friendly sales skills and produced brochures that made it easy for customers to learn about fine coffees†2 Schultz had the vision of making Starbucks a coffee lounge versus a bar after being inspired by eastern traditions. We will write a custom essay sample on Starbucks Case Study specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Starbucks Case Study specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Starbucks Case Study specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Even though he did not agree with the new direction, Baldwin allowed Schultz to open one espresso bar and in 2 years, Schultz was able to buy out Baldwin and equity owners with the help of investors in 19921. Howard Schultz initially saw the power of consumer behavior early on when he realized Starbucks began to be a social gathering mecca for people instead of just an espresso stand. When Schultz first noticed the ‘seismic change in consumer behavior,’ he adopted a free-Wi-Fi service and mobile payment service and noticed that Starbucks began to attract people as if it was a third home for coffee enthusiasts. Although he jokes about not getting rent from consumers, it allowed Starbucks to create an online-experience in their ‘3rd home’ which was unique to the coffee scene in the United States. With scheduled deliveries and privatized ad networking, Starbucks was maximizing its profits and allowing an experience for coffee enthusiasts that did not make them feel locked-into paying. This shift in consumer behavior was in response to the cultural need for a place between home and work. As social beings, humans thrive for an excuse to hang out and socialize or participate in a community environment. This amazing experience that Starbucks supplied needed to be fine-tuned like any business plan. Like any business, Starbucks had challenges, such as their management of spending. In an interview entitled Business Brilliant, Schultz said that too much was focused on the customer instead of the infrastructure. To improve this, Schultz developed a unique experience in the store with the paired pastry-drinks and released free Wi-Fi for customers. In addition to free-Wi-Fi, mobile payments allowed consumers to avoid lines and continue their private work in the confines of the lounge. Soon Starbucks was thriving and announced that â€Å"the opening of 150 new stores in five years significantly exceeded the 1987 business plan’s objective of 125†[3]. Like every company, Starbucks faced unique issues in their business which slowed down growth initially which in effect slowed down growth in the long run. Schultz attributed the biggest hold-back in the long run to not investing in the supply chain, technology or manufacturing. Although Starbucks was marketing their franchise extremely well, they did not invest ahead of the growth curve and the infrastructures became under-par. In the Business Brilliant, Schultz candidly admitted that Starbucks â€Å"solely accelerated growth of the company. † Moreover, Schultz said the issue was that Starbucks â€Å"needed competency well beyond the size of the company and needed the kind of capability they didn’t have. † Since their infrastructure’s efficiency in the short run was hindered by technological limitations coupled with access to capital, the entire store chains needed to be shut down. Schultz defined the event as a need to redesign their image and retrain their employees. Starbucks was losing grip on the customers and their loyalty because the experience of Starbucks was losing its unique features. All of these internal and external issues that Starbucks was facing were all connected with values and company image according to Schultz. Schultz was so specific with the Starbucks experience that when he smelt burning cheese in a store he decided to ask the workers and they told him â€Å"So what, profits are up! † Soon after this, Schultz decided to close down and retrain all stores and employees. He sent out a press release admitting that Starbucks was misrepresenting itself. Although no one had accused or criticized Starbuck’s prior to his declaration, it was a bold move which negatively impacted the financial strength of the Company. However, the action proved loyal to the consumer and enhanced brand loyalty for Starbuck-addicts. This root issue of misrepresentation in the Starbuck’s experience and the company vision was so significant to Schultz that he needed rework his company from the ground up. This road block of ‘conserving the core businesses’ and ‘pushing for relevant innovation’ made Schultz tweak and adjust the Starbucks experience constantly but effectively. While Schultz attributes the root issue for Starbucks to be company image and adapting core values, could it be possible that the vision and image were not correctly portrayed because of unwise funding? Schultz does admit the funding issues contributed to the core issue of misrepresentation of company image and values, but he does not see the two issues in separate environments. Schultz assigns the core issue to misrepresentation and the surface symptoms to be funding. However, more funding or a different funding plan with more focus in infrastructure would have changed the outcome. The core issue was funding and the symptoms of the core issues were misrepresentation because of resource allocation. While their short term fixed costs of infrastructure and labor were solved, their reserved and recurring allocation towards the upgrades of their infrastructure lacked significantly. If properly funded before and seen ahead of the curve, their growth could have been anticipated. This is evident through the need to shut down and retrain employees. It’s clear that the total fixed and variable costs exceeded their revenue initially. Like all companies, there was a start-up curve but when the curve was dealt with, resource allocation was not the focus. The best plan of action ideally would start with addressing resource allocation. Starbucks was able to stay in business and have great growth so it’s clear the management was able to properly allocate their average variable costs and fixed costs for the most part. Nevertheless, it would have been best if the costs were optimized and revenue was set aside for changes in infrastructure. Funding should have been directed at things which would have produced stability in the long run. This would have lowered their total costs and properly funded their infrastructures for the long run and short run. Schultz should have looked at the management immediately after buying out the company and properly hired people with skills that would be able to guide Starbucks through significant growth. Investment in infrastructure to avoid long-term costs would have saved Starbucks from funding issues at later times. In addition to optimizing their infrastructure for the long run, Starbucks needed to invest more in manufacturing and supply chain for the success in the long run. For example, Starbucks should have initially allocated more funding towards small upgrades in their infrastructure such as ovens versus microwaves to avoid unpleasant scents in the customer’s experience. This also connects to Schultz’s emphasis on hiring employees and affiliates based on similar values. If the decision to hire those employees would have initially been more focused on similar values in addition to management skills, the variable costs to upgrade the infrastructure in the long run would have been lower because the management would have been more motivated to deal with the issue before the CEO had to see the symptoms. Finally, the management of Starbucks needed to choose their employee’s more wisely from the start. If Schultz would have chosen his employee’s based on the similarity of their values and the company vision, little issues such as smell in the customer’s experience would have been dealt with more efficiently. This connects to optimizing their infrastructure but focuses on the employees instead of the technology. It’s important to treat both with separate solutions because Schultz reminded us that the employees can only work with the assets they are provided with. This small change in the focus of the start-up of the company could benefit the image of Starbucks very efficiently and in a cost-productive way. Schultz jokes about not getting rent from Starbucks admirers yet he also notes that the potential to plug into the social media of the internet and create the environment was more beneficial than the issue of customers hanging out inside the store. The evolving Starbucks experience caused consumers to have incredible brand loyalty over alternatives such as Pete’s Coffee and Tea and Tullies. Yet the quick and agile response of technology was exactly what Starbucks needed to put it ahead of the ‘growth curve’ in social media while its competitors struggled behind. Schultz’s solutions were effective in the short run but he still realized his long run potential was limited by resource allocation. The problem with Starbucks and consumers was not the shift in demand for coffee consumers but it was resource allocation and initial planning. Howard Schultz’s plan of action was headed in the right direction apart from the minor mix-up between the surface symptoms and the core issue. In addition to new work practices, Schultz integrated new management and had to let go many of the people he knew were limited to the knowledge of the short-term. This new resource allocation towards what Schultz called ‘the backside’ of the company, allowed the company to finally resolve its funding and allocation issues. The new plan of action consisted of hiring new employees and investing in infrastructure to anticipate growth and new forms of technology; the poor management habits of the past from would not hinder Starbucks in the future. Similar to my suggested plan of action, Schultz’s initiative consisted of new employee’s, new technology and investing in the short term. If Schultz’s would have put more funding towards infrastructure to bring stability in the long run, he would have been able to manage the shift in consumer behavior and maintain profit without the need to close down the stores for retraining. The issue for Starbucks is not losing customers but how to accurately represent the company’s values. Moreover, if the employees were chosen correctly and the infrastructure was properly optimized, Schultz plan would have worked perfectly. All in all, every company in any industry is going to face challenges and have limited resources to meet them in an efficient manner. Howard Schultz used the resources he had to best manage Starbucks and handled the big issues he had efficiently and creatively. The future of Starbucks all depends on its management and commitment to adhering to the company vision and values. After experiencing the 2000-2008 period, one can see that the values will inevitably shift with changes in management. 4] The future of Starbucks is highly dependent on how long Howard Schultz continues to be an active part of the company and in shaping its vision. If affiliates and employees are chosen intelligently and have values matched properly with the company’s mission, Starbucks’s vision should be passed down effectively through each generation of new management. Nevertheless, the rise and fall of competitors in a market is inevitable and time will tell if Starbucks will eventually be surpass ed by a competitor. Starbucks will be a primary educational focus for many business programs. It is one of the best managed franchises in history and will remain one of the most successful for a long period of time. Like any business, Schultz received criticism for extreme responses yet these responses excelled the growth of the company. Much like my suggestions, Schultz acted quickly and made extreme changes which were crucial to repairing the infrastructure. Unlike most companies, Starbucks’s major focus is promoting the company image and values instead of putting profits first. Works Cited I. Schiff, Lewis. Starbucks CEO Howard Schultz Coming to NYC. Inc. com. INC, 18 Mar. 2011. Web. 25 Mar. 2013. II. Starbucks Corporation History. History of Starbucks Corporation – FundingUniverse. Funding Universe, n. d. Web. 25 Mar. 2013. III. McGraw Hill. Starbucks Corporation. Starbucks Case Study. MHHE. com, n. d. Web. 25 Mar. 2013. [1] Funding Universe, Starbucks Corporate History [2] McGraw Hill, Starbucks Case Study, Starbucks Corporate History [3] McGraw Hill, St arbucks Case Study, Starbucks Corporate History [4] Funding Universe, Starbucks Corporation History