The US market is getting saturated and taken over by many new coffee shop brands and this has been worrying Starbucks for a long time. Starbucks enjoys a dominant status in the US market but is afraid now that they are losing their market shares to other coffee brands and even the markets are getting very stagnant and low potential for any drastic expansion plan. Kevin Johnson has recently taken over the position of Chief Executive Officer Position from Howard Schultz in the month of April. This popular coffee chain is expected to show some miraculous marketing strategies in order to expand their empire beyond other countries and create brand awareness for their coffee brand. Mr. Johnson was assigned with these very difficult tasks and expected to start showing results as soon as possible.
Starbucks revenue figures have managed to reach the expected level of estimation under the supervision of their new chief executive officer, Kevin Johnson. This announcement was made during the second quarterly report with another announcement of shutting down their 379 Teavana stores so that their primary intention of retention in the US market. There was a downfall in the share prices of this retail coffee chain by 5.5 percent getting the share price to lower at $56.24. Starbucks has also made an announcement about taking over the remaining 50 percent of the stake from their joint venture partner, East China business for an amount of $1.3 billion, which is considered to be the biggest acquisition happened ever after.
There is a big fight for a bigger market share between the traditional and conventional rivals and other retail coffee chains which are getting fierce day by day due to fewer market opportunities. This has led to sloppy sales revenues and managed to increase merely by 5 percent during the last quarter of the year. The executives had cut down the Starbucks’ full-year net earnings per share to $1.97 from $1.96 where it was earlier forecasted for $2.10 from $2.06. According to the report, there were more than 2,800 stores of retail coffee chains across more than 130 cities. But recently there is a rise of 7 percent during the last quarter in the number of retail chains which highlight the demand of the coffee chains in the country.
China is a fast growing and potential market which has a lot of scope for persuading customers to have a change in their preferences and convince them to be the customer. Kevin Johnson said that this is just the beginning and the future seems to be bright for Starbucks in China.