Starbucks' corrective wave is more complex

THE success enjoyed by Starbucks today can be credited to its founder, Howard Schultz, whose vision of providing Espresso in a takeaway cup kickstarted the company's journey to success.

Today, Starbucks is more than just selling coffee. It has established itself as a lifestyle brand and personality cult whereby a cup of Starbucks in hand is iconic of a successful business executive. The most recent breakthrough occurred when the company entered China, a tea-drinking country which has since turned their mouths to coffee, especially among the younger generation. Since its break into the Chinese market, Starbucks' revenue is generated mainly from the newfound economic powerhouse China, second after the United States.

Starbucks also had its share of ups and downs when Mr Schultz left the company in 2000 and was succeeded by Orin Smith. Things started to go downhill from 2001-2008 due to a wrong business strategy of over-expanding, which compromised the quality of its service. At the height of the financial crisis in 2008, Mr Schultz came back and began an extensive reform, which included the infamous move of closing every single outlet in order to re-train its baristas. Since the makeover, Starbucks turned its business around and its share price has grown exponentially over the last seven years.