Read the following case study and answer the questions that follow:

Globalisation $of$ Starbucks

$Thirty$ years ago, Starbucks was a single store $in$ Seattle's Pike Place Market selling premium$-$roasted coffee. Today $itis$ a global roaster and retailer $of$ coffee with some $16,700$ stores, $40$ percent $of$ which are $in50$ countries outside $of$ the United States. Starbucks set out $on$ its current course $in$ the $1980s$ when the company's director $of$ marketing, Howard Schultz, came back from a trip $to$ Italy enchanted with the Italian coffeehouse experience. Schultz, who later became CEO, persuaded the company's owners $to$ experiment with the coffeehouse format$-$and the Starbucks experience was born. The strategy was $to$ sell the company's own premium roasted coffee and freshly brewed espresso$-$style coffee beverages, along with a variety $of$ pastries, coffee accessories, teas, and other products, $in$ a tastefully designed coffeehouse setting. The company focused $on$ selling "a third$-place$ experience,$\text{'}$ rather than just the coffee. The formula led $to$ spectacular success $in$ the United States, where Starbucks went from obscurity $to$ one $of$ the best$-$known brands $in$ the country $in$ a decade. Thanks $to$ Starbucks, coffee stores became places for relaxation, chatting with friends, reading the newspaper, holding business meetings, $or(more$ recently$)$ browsing the web$$ Hill and Hult $(2017).$

$In1995,$ with $700$ stores across the United States, Starbucks began exploring foreign opportunities. The first target market was Japan. The company established a joint venture with a local retailer, Sazaby Inc. Each company held $a50$ percent stake $in$ the venture, Starbucks Coffee $of$ Japan. Starbucks initially invested $$10$ million $in$ this venture, its first foreign direct investment. The Starbucks format was then licensed $to$ the venture, which was charged with taking over responsibility for growing Starbucks' presence $in$ Japan.

$To$ make sure the Japanese operations replicated the "Starbucks experience" $in$ North America, Starbucks transferred some employees $to$ the Japanese operation. The licensing agreement required all Japanese store managers and employees $to$ attend training classes similar $to$ those given $toU.S.$ employees. The agreement also required that stores adhere $to$ the design parameters established $in$ the United States. $In2001,$ the company introduced a stock option plan for all Japanese employees, making $it$ the first company $in$ Japan $todoso.$ Sceptics doubted that Starbucks would $be$ able $to$ replicate its North American success overseas, but $by$ the end $of2009$ Starbucks had some $850$ stores and a profitable business $in$ Japan. After Japan, the company embarked $onan$ aggressive foreign investment program. $In1998,it$ purchased Seattle Coffee, a British coffee chain with $60$ retail stores, for $$84$ million. $An$ American couple, originally from Seattle, had started Seattle Coffee with the intention $of$ establishing a Starbucks$-$like chain $in$ Britain. $In$ the late $1990s,$ Starbucks opened stores $in$ Taiwan, China, Singapore, Thailand, New Zealand, South Korea, and Malaysia. $In$ Asia, Starbucks' most common strategy was $to$ license its format $to$ a local operator $in$ return for initial licensing fees and royalties $on$ store revenues. $Asin$ Japan, Starbucks insisted $onan$ intensive employee training program and strict specifications regarding the format and layout $of$ the store$$ Hill and Hult $(2017).$

$By2002,Starbucks$ was pursuing $an$ aggressive expansion $in$ mainland Europe. $As$ its first entry point, Starbucks chose Switzerland. Drawing $on$ its experience $in$ Asia, the company entered into a joint venture with a Swiss company, Bon Appetit Group, Switzerland's largest food service company. Bon Appetit was $to$ hold a majority stake $in$ the venture, and Starbucks would license its format $to$ the Swiss company using a similar agreement $to$ those $it$ had used successfully $in$ Asia. This was followed $by$ a joint venture $in$ other countries$$ Hill and Hult $(2017).Asit$ has grown its global footprint, Starbucks has also embraced ethical sourcing policies and environmental responsibility. Now one $of$ the world's largest buyers $of$ coffee, $in2000$ Starbucks started $to$ purchase Fair Trade Certified coffee. The goal was $to$ empower small$-$scale farmers organised $in$

cooperatives $to$ invest $in$ their farms and communities, $to$ protect the environment, and $to$ develop the business skills necessary $to$ compete $in$ the global marketplace. $In$ short, Starbucks was trying $to$ use its influence $to$ not only change the way people consumed coffee around the world, but also $to$ change the way coffee was produced $in$ a manner that benefited the farmers and the environment. $By2010,$ some $75$ percent $of$ the coffee Starbucks purchased was Fair Trade Certified, and the company has a goal $of$ increasing that $to100$ percent $by2015.$

Question $1.$

Examine any Four $(4)$ interrelated drivers $of$ change $in$ the context $of$ globalization $of$ Starbucks.