After reporting disappointing quarterly sales, Starbucks has announced that it will deliver coffee to parts of U.S. through its mobile app starting in 2015. Also, Starbucks plans to innovate by offering preorders of coffee to get people in and out faster. By creating points of difference, Starbucks will be able to attract new customers, increase customer loyalty, and allow the company to grow. Since Starbucks has loyal customers and the line-ups at Starbucks are extremely long, it is likely to increase profits.

In contrast, the initial cost of starting a delivery service will create a sunk cost for the company and the workers may not be as productive in the beginning. If the delivery time takes too long, the coffee may not be as fresh, leaving the customers dissatisfied. As delivery will increase the cost and the price will increase, the price charged on delivery may decrease the quantity demanded. If Starbucks is able to keep the delivery fees low, it is likely to become successful. By offering delivery, Starbucks will be able to raise what it can offer and continually grow and advance from the low sales.

Work Cited

Choi, Candice. “Starbucks’ next Big Move: Delivery | Toronto Star.”Thestar.com. N.p., 31 Oct. 2014. Web. 11 Nov. 2014. <http://www.thestar.com/business/2014/10/31/starbucks_next_big_move_delivery.html>.