Current Internationalization Strategies

Starbucks expected to save $100 million both in fiscal year 2013 and 2014 from declining commodity costs. “Starbucks takes a holistic approach to value which includes the quality of our coffee, food and products we sell,” the company said in an email to IBTimes. “We approach pricing on a long-term, product-by-product, market-by-market basis.”

Dunkin’ Donuts’  significantly lowered coffee costs in 2013, compared to 2012,  “As a franchisor, Dunkin’ Brands is mostly isolated from coffee commodity swings in the short to medium term. Our income is derived from franchisee royalties,” he wrote in an email. “Our franchisee-owned NDCP [sourcing and distribution co-operative] continues to buy forward strategically to take advantage of market conditions.”

Starbucks and Dunkin’ buy Arabica coffee. Dunkin buys from Central and South America, while Starbucks buys from Africa and the Asia-Pacific. Sourcing is spread across 29 countries.