Starbucks to Buy Teavana for $620 Million
The coffee tycoon now will expand its inventory and incorporate tea as part of its sells, believing strongly that the success they found in coffee will expand to tea. Starbucks estimates that the tea market at approximately $40 billion and growing, so increasing its presence in this market would greatly increase its sales from its current Tazo brand tea. By increasing its presence in the market some of the buyers might prefer to purchase from Starbucks rather than other prospective sellers because of many reasons. The tea could be cheaper and more convenient for most customers to acquire if they choose to drink tea instead of coffee. This would also relate back to Starbuck’s marketing locations and potential marketing strategies.
Due to Starbucks massive amount of resources and their ability to attract customers with certain specials and products, their assimilation of Teavana will prove monumental in their sells. Thus, this would observe more of a market with intermediaries who sell their own good and how that would benefit each of the companies. Many of the competitors would now lose out to Starbucks because of their ability to make their coffee products cheaper to the buyers.
-mrv
http://dealbook.nytimes.com/2012/11/14/starbucks-to-buy-teavana-for-620-million/