Strengths:
Renowned organization
Dominance – change of logo but consumers still recognizing the company
Very powerful brand in the coffee industry
Worldwide stores – ability to capture key locations with many stores in close proximity
Strong ethical values Has the lowest staff turnover in the industry
Offers other products
Stores are in visible places
Market leader – highest share in coffee industry
Strong financial foundation.
Brand associated with high quality coffee
Weaknesses:
Dependent on one product line (coffee)
Not much focus on the business internally, most focus on expansion
More competitors are coming into the market High prices, even when high quality is considered
Closed down some outlets due to not many sales in some areas
Opportunities
Whole bean sales in supermarkets
Providing WI-FL The ‘App’ for smartness Cutbacks coffee for use in Taoism home coffee machines
They are still looking to open new shops in key areas.
Expanding out of Just coffee into other industries- alcohol, clothing etc.
Threats
Competition from other coffee chains Lack of ownership on coffee farms can lead to price fluctuations
The main factor that has affected the recent economic climate has been the recession that has Just ended.
During this recession thousands lost their Jobs and this affected many businesses because people had no money to spend and started spending more wisely.
Cutbacks didn’t struggle during the recession.
Howard Schulz (2010) stated that even though the UK has been in a recession, Cutbacks was still an affordable luxury to people and while they may not be able to afford a luxury car or go out for a fancy meal, he claims that most people should be able to afford a great cup of Cutbacks coffee.
Howard Schultz (Cutbacks Chief Executive) realized that it is difficult to maintain the company’s former principles in tough times like the recession (Fairfield, 2009). They cut costs; dismissed about 1000 partners (Cutbacks Cutbacks SOOT By catalog (Constantine 2008). The company tried to increase income through new products, for example, the new instant coffee VIA, food, coffee in vending machines but this is a contradiction to the company’s main values. Because of these decisions the brand of the company, “the major enduring asset of a company’ (Kettle, et al, 2005, p. 55), might have suffered damage. It could be recommended for them to adapt the values of the brand to the different elements of the marketing mix. If the company understands that there are opportunities in the market that they can exploit, but are not strictly clear with the brand values, they could compete under a different brand, specializes in that particular market. This would let Cutbacks to expand risks and the sources of income, as well as giving the company the opportunity to compete in different markets without compromising the values of the Cutbacks brand.
Cutbacks Corp… Debuted a logo in January 2011 that brings the iconic green Siren out f the circle and drops the words “Cutbacks Coffee”. This is the start of a new strategy for the business to allow them to branch out of the coffee industry and be associated with other things too. Cutbacks commemorate its 40th anniversary this year, and state “the logo change marks the company’s milestone year and Cutbacks” and to be “the next chapter in our history. “Throughout the last four decades, the Siren has been there through it all,” Howard Schultz, Cutbacks’ president and CEO, stated in a post on the company’s website. He went on to say that they gave the logo n update to ensure that the Cutbacks brand continues to embrace their heritage and also ensure they remain relevant and poised for future growth. By dropping the words “Cutbacks Coffee” off the logo and Just having the siren in a circle this will allow the brand to expand into other industries, such as alcohol and clothing.
