Starbucks PESTEL

The PESTEL framework is designed to provide managers with an analytical tool to identify different macro-environmental factors that may affect business strategies, and to assess how different environmental factors may influence business performance now and in the future.

Starbucks Corporation is an American global coffee company and coffeehouse chain based in Seattle, Washington. Starbucks is the largest coffeehouse company in the world, with 20,891 stores in 62 countries.

Political

High taxation imposed on farmers in those countries producing coffee bean will usually mean Starbucks pay a higher price for the Coffee they purchase. Any fluctuations in taxation levels in the industry are certainly passed on to the consumers. When the USA pulled out of the ICA               (International Coffee Agreement) which set export quotas for producing nation and to kept the price of coffee stable. Which leads to the coffee quotas and price controls to cease. 

Furthermore, political stability in coffee producing regions like Zimbabwe will have huge impact on Starbucks operations as farmers can be able to concentrate on producing quality coffee beans. In addition, reduction in licensing and permit cost in producing countries for Starbucks would lower production cost for farmer, which then lead to the savings of purchaser.

Economic

High inflation rates in the countries where Starbucks have established presence might 
result to low sales as potential customers might not afford to regularly buy coffee. Since 
Starbucks exports coffee from various countries, fluctuating exchange rates might result to 
reduction in profit margins. Finally, slow economic growth rate in countries where Starbucks has established presence as already highlighted might result to low consumer purchasing power implying decrease in demand for coffee. 

Social

Those people with the most disposable income, eg young professionals will be accustomed to high standards coffee. Starbucks ensured it's shop are clean and comfortable services of the highest order. A large number of employees in large cities go out for lunch rather than an internal canteen. Starbucks uses this to their advantage and locate shop near to offices to attract people where they can meet up hence, increasing the amount of people in the shop during breaks hours.

Technology

Developments in the technology of coffee making machines and the computers that Starbucks use to run their cash registers enable their staff to work more efficiently and quicker. This will result in customer being to serve quicker. Hence, creating the potential to serve more customers. This will also prevent customers from having to wait around for long periods this improving customer relations.

Environment

Pollution and planning permission are the key environmental factors that might affect 

Starbucks operations. In some markets, Starbuck might find it hard to obtain planning permission 

to establish coffee brewing plants. Moreover, the company might find that some countries are 

quite strict on the impacts that the company has on the environment while other countries are 

not. 

Legal

Nations differ greatly in their legal environments. Before Starbucks decides to operate a business in a foreign country, the country’s attitude toward international producers, government bureaucracy, political stability, and monetary regulations must be thoroughly considered. One example of political instability that causes Starbucks to reconsider opening a store in the country is the nation of India. India’s government is notoriously unstable. The country has elected 10 new governments in the past 25 years. This instability makes doing business risky because of the continual change in laws and oversight concerning business and financial matters