The Coffee Bean & Tea Leaf

Introduction

Background

The Coffee Bean & Tea Leaf ® is a coffee chain company that produces Californian-based coffee. The company was founded by 2 people, Mona and Herbert Hyman.

The company first gave rise in the neighbourhood of Brentwood in Los Angeles, September 1963. The Coffee Bean today has many locations all over the world including San Francisco, Phoenix, Las Vegas, Honolulu and all over Southern California including Los Angeles, San Diego, Santa Barbara and Ventura. Many “Coffee Beans stores” which are found outside of California are franchises.

Most of these stores that are located all around the world are franchised. A great entrepreneur, Victor Sassoon, from Singapore had a vision of expanding the company Coffee Bean & Tea Leaf ® and therefore opened locations throughout Southeast Asia including Singapore, Malaysia, Vietnam, Philippines many more.

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Accommodating to the current society which is rich in technology and to cater to consumers’ having demands to be online 24/7, The Coffee Bean & Tea Leaf offers Wi-Fi Internet access at virtually all company-owned stores and franchise stores. The company started installing the Wi-Fi units in mid 2008 and many stores had the wireless service by the third-quarter of the year. The service is totally free and does not require any types of registration or payment.

Objective

The purpose of this report is to identify the company’s potential growth throughout the years as it started from a small coffee stall by using the help on marketing strategy analysis. With a good marketing strategy, a small coffee stall would be able to grow to become a huge franchise company.

The purpose of identifying the different roles is to basically tell us that Coffee Bean & Tea Leaf ® is proud to present their extended services by taking the extra mile to allow customers to reach Coffee Bean & Tea Leaf ® in the nearest way and convenient way by providing delivery services and so on.

Lastly, the aim of this report is to allow us to identify and make sure that The Coffee Bean & Tea Leaf ® would be able to out win other coffee companies like Starbucks and The Coffee Connoisseur.

Scope

In this report, certain marketing analysis would be done on the company to achieve the objectives. Due to the limitation of history of The Coffee Bean & Tea Leaf ® the step by step process of how The Coffee Bean & Tea Leaf ® gradually grows would be touched on. However, research would be used to prove how the company managed to grow to a huge franchise company today from a small coffee stall.

SWOT Analysis of The Coffee Bean and Tea Leaves

The Coffee Bean and Tea Leaves’ strength

Recruiting and training programme

One of the strength that this company possesses is start up a regional office in Singapore that would provide training and recruitment to the regional countries around. Before there was a regional training and recruitment office, the staffs and managers were recruited by local consultant agencies.

By having this Recruiting and training programme, The Coffee Bean and Tea Leaves each manager that is trained by the programme would be suitable and being knowledgeable with experience about the area. With the help of the training, they would be able to provide the best solution with any problem that arises, changing and adapting to new strategies. Staffs that go through the training programme would be less introvert and be more direct when it comes to customer service. Trained staffs would then be able to help customers with their needs without any problem, providing a pleasant service.

Special marketing strategy

Another strength of this company is to have a special marketing strategy to attract customers in a high volume and also be known around by consumers through location of high visibility. The Coffee Bean and Tea Leaves uses two types of market entry strategies which are master franchising and company owned-stores. To be in an advantage in the foreign market, marketing approach is essential.

For The Coffee Bean and Tea Leaves, the three main marketing approaches are market entry, marketing position, and site location. The Coffee Bean and Tea Leaves prefers master franchising as a mode of entry to the market in Asia. Due to the difference in environments from the USA and Singapore, the system, products and marketing have been modified and changed to fit to the different environments. In the USA, company owned-stores were used instead.

Franchise

Other than just master franchising, franchise communication is also another strength the The Coffee Bean and Tea Leaves make use of. The Coffee Bean and Tea Leaves would communicate between franchisee and franchisor to allow more information to be gathered by the franchisor to help see the franchisee’s problems which were faced during their beginning stages of franchising in a new area or region like Asia.

Just like all franchise company, franchise training would be received to get hold of how the company works. The master franchisee and managers whom are pioneers to start their franchising in a new area would go for training in the United States of America to learn about the business ethics and how The Coffee Bean and Tea Leaves run.

The Coffee Bean and Tea Leaves would make few amendments to the original decisions on products, systems and marketing for their international franchise agreement which will be used as a blueprint for franchising in Asia. Expertise and advice would be gathered from hired solicitors who specialize in domestic and foreign franchising. In all, a solicitor is needed to accommodate for the negotiation of contract modifications and contract enforcement to grow a good long term relationship between The Coffee Bean and Tea Leaves Company and franchisee.

Special Business strategy

Other than just adapting to new environments and changing to accommodate to different areas, The Coffee Bean and Tea Leaves feels that standardization is a very important factor. The Coffee Bean and Tea Leaves are consistent throughout from the first original coffee stall in Los Angeles. Despite knowing that cultural difference and food variety will affect the demand of products and services, The Coffee Bean and Tea Leaves feels that having keep their level of standard was more important than adaption and thus this allows The Coffee Bean and Tea Leaves to bring up their name in the market. Since The Coffee Bean and Tea Leaves have a very high level of standardization, it places a fix image of The Coffee Bean and Tea Leaves in the consumers mind. Therefore, when being questioned The Coffee Bean and Tea Leaves is being perceived consistently throughout all markets. Knowing that standardizations are important, adaptations must also be made to cater to Asians as they need food with their coffees. There is more range of varieties in the menu of a Coffee Bean stall in the Asia region compared to the Coffee Bean stall in its home country in Los Angeles.

Quality of goods and products

The Coffee Bean and Tea Leaves is well known for their quality of coffee bean. This company also has a very huge commitment to the coffee beans and tea leaves that they produce and sell. Every year, The Coffee Bean and Tea Leaves produces and serves the finest quality of coffee and teas all around the world getting the best harvest from Sumatra and Costa Rica inspecting the grade of coffee and accepting only the highest grades of coffee and tea leaves.

Creativity with time

From the beginning when The Coffee Bean and Tea Leaves started brewing, it has developed the finest products, advancing in retailing management, improving roasting techniques and also innovating new trends for coffee and tea drinks.

During that period, The Coffee Bean and Tea leaves also builds up on their experience by inventing numerous drinks. The Coffee Bean and Tea Leaves invented its trademark Ice Blended ®, which is a mocha drink filled with chips on ice blended in the blender. It is one of the most favourite drinks for most coffee drinkers especially The Coffee Bean and Tea Leaves lovers.

The Coffee Bean and Tea leaves also created their first specialty coffee extract ever produced. The coffee Bean and Tea Leaves was very innovative and took a step. beyond what people sees in coffee. French Deluxe vanilla and Special Dutch Chocolate are the industry’s’ first that gives coffee drinks a flavour very much superior to any other coffee stalls. Even until today, The Coffee Bean and Tea leaves did not stop with what they started on. One of their latest products today is the Chai Latté, a creamy sweet spicy chai tea drink and its juice-based Ice Blended Drinks, a variety of smoothies blended with French Deluxe vanilla powder that have once again set an industry standard

Charity involvement

The Coffee Bean and Tea leaves had not only been making coffees and teas just for our consumers. The Coffee Bean and Tea leaves also contributes to the society by contributing to the society by charity.

This company had contributed to other charity, schools and institutions locally and globally which would then benefit to our community and own company. The Coffee Bean and Tea leaves is working to a target where it would be recognized as not only a professional coffee stall but also a helpful friendly company to the locals around.

By doing so, The Coffee Bean and Tea Leaves reputation would earn a good reputation and be recognised all over the world.

The Coffee Bean and Tea Leaves target audiences would be for teens and young adults who would still be willing to enjoy life by spending money at this classy coffee stall and enjoy the amazing taste of fresh and rich coffee with a price to pay.

Due to the limitation of target audiences, Coffee Bean and Tea Leaves would then be competing with other company that provides international standard for outstanding ambience, services for food and beverage as well as high quality waiter service. For example, The Pan pacific hotel

On the other hand, McDonalds target audiences are the children and young teens.

The Coffee Bean and Tea Leaves’ weakness

Target audiences

The Coffee Bean & Tea Leaf is targeted the youth, who are teens and working adults in their twenties. This has become a weakness for the firm. The Coffee Bean and Tea Leaf aligns itself with other major brands targeting the youth market. This may lead it to lose some potential market. For example, DOME’s positioning is “expensive and exclusive” as its target market is the professionals, managers, executives and businessmen (PEMBs). But The Coffee Bean & Tea Leaf’s target market is the youth and who didn’t have strong consumption power.

       In the other hand, Mc-Donald’s target market is children and teens. Both of the target market for The Coffee Bean & Tea Leaf and Mc-Donald’s are sensitive to the price issue. Mc-Donald’s positioned the restaurant well in the target market by a competitive pricing strategy. This pricing strategy likes a threat for The Coffee Bean & Tea Leaf. The market share and profit for The Coffee Bean & Tea Leaf are limited.