Decisions in Paradise, Part II Essay Example | Topics and Well Written Essays - 750 words - 1

Decisions in Paradise, Part II - Essay Example The company has gained the trust and confidence of the company’s current and future customers that they are paying their money’s worth of coffee and other Starbucks products. In terms of service, the company has proven itself to implement world class restaurant service in more than 30 countries around the world. Implementing the going green policy complies with global environmental laws, including the Island’s anti-pollution laws (Ferrell, 2010). Weaknesses. Within the Kava Island market segment, the Starbucks entity’s coffee and other restaurant products are normally higher than the prices of Starbucks’ competitors’ selling prices. The company is only focusing a majority of its marketing management activities on coffee sales. The company relies on coffee sales to bring the company out of a possible bankruptcy situation. The current economic depression enveloping the United States and United Kingdom triggered a drop in the demand for Starbuck s coffee. With many employees retrenched by the bankrupt United States and United Kingdom companies, the increased unemployment rate precipitated to many of Starbucks’ current and future customers losing their jobs. With the lost of their jobs, the current and future customers’ purchasing power declined. ... The company can also save on salaries in countries where the legally allowed salaries are lower than the salaries of Starbucks employees in the United States and United Kingdom. Another opportunity is to hire 16 years old and above employees as part time workers for short periods of time. Hiring the teenagers will help the parents pay for their students’ school and personal needs (Ferrell, 2010). Threats. There are several competitors cropping up in the same coffee restaurant market segment, including Kava Island. The Island’s coffee competitors include the lower priced coffee-serving restaurants in the newly established Kava Island branch. The cultural diversity of the new countries hinders the implementation of the United States-based culture imbued in the company’s unique global marketing strategies (Ferrell, 2010). Analysis of specific steps of the chosen decision-making technique Starbucks implements specific steps in the implementation of the companyâ€℠¢s decision-making techniques. The steps include advertising the many benefits of sipping the reasonably priced cup of the uniquely Starbucks coffee aroma (strengths). For example, the Starbucks coffee ambience creates togetherness among the company’s group clients. Likewise, the advertisements effectively show the busy business line and staff employees can easily ponder the day’s decision making plans while taking their Starbucks lunch (Nutt, 2010). Additionally, buying the local coffee products of Kava Island farmers, instead of importing the coffee plant raw materials from the US reduce raw materials transportation expenses. Consequently, the company can lower the selling prices and still generate more than enough profits (Nutt, 2010). Furthermore, the company hires the local residents to work

Economic Analysis Essay Example | Topics and Well Written Essays - 2000 words

Economic Analysis - Essay Example It is expressed as a percentage change in the quantity of a product demanded as a result of a small change in price. In reality, the price elasticity for demand is affected by many other factors other than just the price of commodity. When making calculations, it is normally assumed that all the other factors which could affect PED remain constant. High price elasticity means that the demand for the product is extremely sensitive to changes in commodity price. A zero measure shows that the demand is inelastic and thus will not be affected by changes in pricing. When the value is one, it shows that the demand is perfectly elastic and thus a pricing change will result to an equal change in demand. When the elastic is more than one, it implies that the demand is elastic and when the pricing is changed, it will automatically result in change in the demand from the item as wrong as all the another factors are kept constant. The cross-price elasticity measures the responsiveness of a product demand to changes in price of another commodity. It is measured as a percentage of change observed in the demand for a product as a result of price change of a completely different commodity. It can be used to determine the type of relationship existing between two products (Mankiw 2012). It allows economists to make a distinction between complementary and substitute commodities. Products can be defined as compliments of each other when the calculation of the cross elasticity for demand yields a negative result. When the measure gives a positive value, it is an indication that the products are substitutes of each other. When the calculations yield a zero measure, then there is no relationship between the products (Wetzstein 2013). When a competitor reduces prices of its prices, rival organization will have to consider the calculation of cross-price elasticity of demand in estimating the impact of this price change o n the demand for its products. This in turn makes the