Complete.

Running head: RESEARCH PAPER ON STARBUCKS FOR MICROECONOMICS CORE PRINCIPLES

Research Paper on Starbucks for Microeconomics Core Principles
Institutional affiliation
Name

1

RESEARCH PAPER ON STARBUCKS FOR MICROECONOMICS CORE PRINCIPLES

2

Research Paper on Starbucks for Microeconomics Core Principles
Price elasticity of demand is an idea which is the cornerstone of every discussion of
microeconomics principles along with the pricing for marketing efficacy. Obviously, price
elasticity of demand is based on the notion that the customers are affected by price
manipulations. On the side of the producer, price is about the unique reflection of marketing and
production costs used in generating the product to the market place along with the beginning
point in calculating the profit and revenue. With the focus on the customer, price is a primary
element in the value and image-understanding of the product (Garthwaite et al., 2017). Most
organizations have relied on the knowledge of price elasticity of demand, and this has hence
enabled them to learn the demand for their supply in the market. Price elasticity of demand
knowledge has also contributed to the success in Starbucks. This research paper focuses on
Starbucks by presenting its demand and supply for its product and compares its market with the
overall market.
Starbucks History
Starbucks is an American coffee based company as well as a coffeehouse chain. The firm
was established in Seattle, Washington, and this happened in 1971. Currently, the company
operates in more than 30,000 locations across the world. Its locations are known to serve wholebean coffee, espresso, and loose-leaf teas, among other products. The first time when the
company became commercial was in the beginning1980s. in the late 1980s, the company
experienced a downtown while trying to expand into the British Columbia and Midwest.
Nevertheless, it experienced its first revitalized prosperity while tapping the California market,
and this was in the early 1990s (Garthwaite et al., 2017). The first Starbucks location based
outside North America was opened in Tokyo in the year 1996. On a daily basis, the company

RESEARCH PAPER ON STARBUCKS FOR MICROECONOMICS CORE PRINCIPLES

3

opened averagely two new locations between 1987 and 2007. Howard Schultz, the former
company CEO announced his resignation on 1st December 2016 and after his resignation, he was
replaced by Kevin Johnson who assumed the CEO role on April 2017.
Company Overview
Starbucks Corporation is a company that is guided by its values, mission, and vision
statement. The mission of the company is to cultivate and inspire the human spirit: one cup, one
person, and one neighborhood. This mission statement suggests why the company has more than
30,000 locations across the world. Its vision statement entails seeing Starbucks become the
premier purveyor of the ideal coffee in the world and at the same time, maintain the
uncompromising principles while growing (Caro & Sadr, 2019). The company management
ensures that its staff embraces the company values the first being creating a culture that
welcomes all customers. Its consequent value entails being available, championing for
transparency, respect, and dignity. The values, mission, along with the vision statement of
Starbucks have been designed in a way that they motivate the employees. Coffee is the main
product offered by the company, but, while the company was in the course of experiencing
growth, the company diversified where it offered other products such as tea and other products
processed fro...