In the initial introduction of Starbucks in Oslo, the marketing team may opt to give one day of discounted premium coffees and pastries up to 50%. Regular coffees may be given for free in exchange of customer preference/feedback information. This will excite the consumers and help spread the word about Starbucks. In a positive note, the Hot Drinks study showed that there has been a positive growth of private label coffees in 2007 because there has been a wider product range. Thus, low price is no longer the only deciding factor for consumers and may serve as leverage for Starbucks to compete equally with local coffee shops.
F. Channels of Distribution Initially, Starbucks can put up three local branches within Oslo, specifically in a strategic location near or within the airport, seaport and train station. The standard size of the Starbucks stores range from 1200 to 1500 square feet (Dutta and Subhadra). Starbucks have numerously entered international markets using a three-pronged strategy: joint ventures, licensing and wholly owned subsidiaries. Thompson, Gamble, et. al. (2006) explains: 1. Licensing foreign firms – using the company’s technology or to produce and distribute the company’s products.
Using strategic alliances or joint ventures means utilizing foreign companies
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The same way, opening a new store in Norway should have experienced managers and baristas (brew masters) from Seattle until the trained Norwegian management team and baristas become knowledgeable of the operations of Starbucks. Management trainees normally attend classes for 8 to 12 weeks. Their training includes the details of store operations, practices and procedures as set forth in the company’s operating manual, information systems, and the basics of managing people (Thompson, Shah, et. al. , 2004). Recognized worldwide as equitable employer, Starbucks will undoubtedly provide fair compensation to its employees.
In 1995, Starbucks implemented an employee stock purchase plan. Eligible employees could contribute up to 10 percent of their base earnings to quarterly purchases of the company’s common stock at 85 percent of the going stock price (Thompson, Shah, et. al. ). In the US, Starbucks employees were paid around 9 USD to 12 USD an hour or equivalent to 63. 88 NOK to 85. 18 NOK. However, the minimum wage of Norway amounts to 105. 194 NOK or 14. 85 USD, a difference of 2. 85 USD. Thus, Starbucks have to adjust to the local minimum wage requirement.