What types of inventory issues Starbucks might reflect upon at the end of each year?

The mission of Starbucks is to inspire and nurture the human spirit—one person, one cup, and one neighborhood at a time. Starting out as a single storefront opened in 1971 in Seattle, Washington, it has expanded to 23,043 stores across 68 countries over just a mere 44 years. Starbucks opened 1,677 new stores in fiscal year 2015 alone and served over 72 million more customers in fiscal 2015 over the prior year.

From its start as a roaster and retailer of coffee, tea, and spices, Starbucks’ product offerings have expanded to include more than 30 blends of coffee, handcrafted beverages, coffee- and tea-brewing equipment, mugs, packaged edibles, books, and more. Starbucks’ beverages and merchandise are also sold at other retail establishments, such as grocery stores.

Starbucks offers a staple menu of coffee and tea beverages year round, as well as a seasonal menu that it continually updates, in addition to developing new flavors and products to offer variety to existing customers and to appeal to new customers. For fiscal year 2015, Starbucks reported net revenues of $19.2 billion, an increase of 17 percent over fiscal year 2014.

With increasing sales and ever-expanding distribution channels, managing inventory levels and purchasing requirements is crucial. Starbucks must order merchandise with enough lead time to have it in stores ahead of demand. At the same time, it must closely monitor in-store inventory levels so as to not have excess inventory and still have the ability to stock new incoming products.

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