History and Background of the company
Caribou Coffee Company is the second largest company in the United States (Press Release, 2013), that sells coffee, bakery items and tea in about 415 coffeehouses that are owned by the company. The products are sold in approximately 40 states and also in the District of Columbia, and in the 126 franchises located at different places worldwide. The Caribou Coffee Company was founded in the year 1992, the founder of company is John Puckett, who was a management consultant in the Bain & Company-a Boston based company. He has provided assistance to the other companies for the development of strategies and ideas, later he decided for becoming an entrepreneur. Puckett and his wife have decided to make money and so they opened a company that served the customers with coffee. The initial idea for the Caribou was however a five day a week plan that aimed at the office employees in the business district. Then the company kept on changing its locations due to poor availability of the rental building or land. Then in 2010, the company has announced re-branding at a corporate level and started using the latest logo i.e., ‘coffee bean caribou’.
Furthermore, the company has started the campaign for the purpose of communication and with this campaign it has targeted the adults of ages 18-35, which include the students as well as the working class with annual household income of $30,000. The company has targeting this age group due to the fact that this demographic group mostly likes to drink coffee as compared to the individuals below or above the ages of 18 to 35 years (Taylor, Wilborn, Harvey, Wismann & Willoughby, 2007). The campaign has also emphasized on the services that are expected by the consumers and provided them the information about the quality and taste that they can get on their visit to the coffee shop and testing their product.
Industry Analysis, Trends, Growth, Main Competitors of Caribou Coffee
The specialty coffee is a growing, powerful and strong industry in America. The consumption of specialty coffee has increased by above 48% from the year 2001 to the year 2006. The market of the specialty coffee is estimated to be above $12 billion on annual basis. Furthermore, the coffeehouses have also increased in number. This can be analyzed from the fact that there were 500 units in 1991 and now above 30,000 units are operating. so, externally the company is enjoying satisfactory repute in the market and is maintaining its differentiation in order to maintain the loyalty of customer.
Considering the internal analysis of Caribou coffee, the company is successful in maintaining the competitive advantage by satisfying the customers and it is done by paying special attention to the social and human capital. The establishment of the human capital facilitates the company to have the information about the skills, capabilities, experience and knowledge of the employees associated with the company (Coleman, 1988). However, at Caribou Coffee there are extensive procedures that are designed for providing training, which help in building human capital. This ultimately, paves the way to the satisfaction of the customer. Further, in Caribou Coffee, The social capital is built in through the relationship network that employees have within the organization. In order to retain the human capital, the company has implemented tangible and intangible rewards for employees.
However, various aspects of the organizational cultural have created social and human capital that has helped in gaining loyalty and confidence of employee for the company i.e., Caribou Coffee. Caribou Coffee company works on the firm belief that the customer services are guided by the employees and effective strategies and practices for hiring, training and retaining employees play an important role in this regard.
The company is enjoying good growth and market share. This can be analyzed from the following figure 1.
Figure 1: Growth of Caribou Coffee
The figure shows that Caribou Coffee is performing well in different segments as compared to Starbucks. Caribou is generating more income in franchised stores and in food service. The present trends in the industry however, deal principally with the store’s atmosphere. Caribou coffee offers the facility of free Wi-Fi in order to provide such a conductive environment to the customers that provide relaxation and at the same time global connectivity. Nowadays the company is going through the process of re-branding that helps in the creation of a highly contemporary and less regional customer value and base. The company is also trying to improve its positioning strategy in the market with increased focus and new look on the experience of customer.
The main competitors of Caribou Coffee are Starbucks, McDonalds and Dunkin Donuts (Sellen, 2011). McDonalds and Starbucks are regarded as the direct competitors of Caribou coffee while Dunkin Donuts is considered as the indirect competitors.
SWOT Analysis of Caribou Coffee
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