Starbucks Competitors & Alternatives Analysis

Starbucks opened its first store in Seattle in 1971; it owns 33,669 locations in 83 countries. Starbucks’ revenues far outpace rivals such as Dunkin’ Donuts and McCafé. Starbucks is a “second-wave coffee” symbol for its superior cafeteria coffee, excellent customer service, and the most delicious espresso.

Starbucks Corporation is an American coffee company that operates on a global scale. According to the most recent available data, Starbucks had an average of 240,000 employees globally.

The expansion strategy of Starbucks implemented by Schultz resulted in the opening of 165 stores in that country. The company opened more than 1,000 stores during its IPO in 1992, some in Japan and Singapore. A year later, it employed more than 2,000 people.

Starbucks corporation now operates 28,000 retail outlets in 76 countries. The company leads the U.S. coffee market with a 39.8% share. A market capitalization of $44.5 billion places it behind McDonald’s as the second most valuable fast food brand globally.

The battle for the top spot as the world’s coffee king has been going on for years between Starbucks and its competitors, Dunkin’ Donuts and McDonald’s. A company that began with just one location about 50 years ago has experienced tremendous success and growth. 

Starbucks’s marketing strategy matches the “go-to coffee spot” concept, as Starbucks is on virtually every corner and used for work and socializing. Starbucks has evolved from its humble roots as a Seattle coffee roaster to a place where customers can recharge their batteries to and from work.

Recently, Starbucks has made significant investments in its brick-and-mortar locations, including expanded food offerings, remodeled restaurants, and improved reward programs, among other things. The earnings for the fourth quarter of 2018 show that the company’s efforts are paying off.

After delivering an impressive earnings report, Starbucks’ stock soared on November 2, 2018. The company posted revenues of $6.3 billion in the third quarter of 2018, compared to $5.7 billion in the same time as the previous year. 

Starbucks’ growth appears to have no end, so here’s a look at how the firm compares versus its competition. On the other hand, Starbucks offers a wide variety of goods and services, creating many competitors. 

Who Is the Biggest Competitor of Starbucks?

Dunkin’ Donuts and McCafé are among Starbucks’ most significant competitors, though both will trail Starbucks in market share by 2023. Other major competitors of Starbucks are Tim Hortons, Folgers, Cafe Nero, Costa Coffee, and Maxwell House.

The rivalry also comes from locally owned businesses, such as Peet’s Coffee and neighborhood coffee shops in some areas. If you’re curious about Starbucks’ competitors, including Dunkin’ Donuts, McCafe, and other similar companies, continue reading for more useful information!

The company’s strategy is based on satisfying the wants and needs of customers while also increasing the number of menu items and shop locations available.  Starbucks also owns several subsidiaries that sell similar or identical goods. 

These are just a few options, including Ethos Water, Evolution Fresh, Seattle’s Best Coffee, La Boulange Bakery, and Teavana, which are available now. This strategy aims to improve customer service, grow the customer base, and attract customers away from competitors.

Compared to 2019, Starbucks’ yearly sales were $26.51 billion, or 11.28 percent lower. The company sells whole beans, ground, and instant coffee, among other things. Regardless of the industry, Starbucks faces several rivals.

Many companies compete with Starbucks. The market is dominated by large corporations that can influence the market and maintain a competitive edge. Starbucks competes with fierce rivals in most of the markets in which it operates. 

These rivals are also available to customers who wish to purchase a product from a different manufacturer. Some of them compete directly, while others do so in an indirect manner. The following are the most effective Starbucks Competitors and substitutes.

Top Starbucks Competitors & Alternatives

#	Company	Founded	Headquarter	Website
1.	Costa Coffee	1971	UK	Visit Website
2.	Dunkin Donuts	1950	Massachusetts, US	Visit Website
3.	McCafe	2003	Illinois, United States	Visit Website
4.	Café Coffee Day	1996	Bengaluru, India	Visit Website
5.	Tim Hortons	May 17, 1964	Oakville, Canada	Visit Website
6.	Lavazza	1895	Piedmont, Italy	Visit Website
7.	Peet’s Coffee	April 1, 1966	Emeryville, CA	Visit Website
8.	Kentucky Fried Chicken	September 24, 1952	Louisville, KY	Visit Website
9.	Dilmah	1988	Peliyagoda, Sri Lanka	Visit Website
10.	The Republic of Tea	1992	Novato, CA	Visit Website
11.	Folgers	1904	San Francisco, California	Visit Website
12.	Tazo	1994	Kent, WA	Visit Website

1. Costa Coffee

Costa Coffee is a coffeehouse chain that originated in the United Kingdom and is now owned by Whitbread. Costa Coffee has over 2,400 stores across 31 countries. The company employs over 38,000 people.

Costa Coffee was founded in 1971 by brothers Sergio and Bruno Costa as a wholesale operation supplying roasted coffee to caterers and restaurants. The first Costa Coffee shop opened in Vauxhall Bridge Road, London, in 1978.

In 1995, Whitbread bought a minority stake in the company and, in 2009, acquired the company outright for £340 million. In addition to its coffee business, Costa also operates some Costa Express self-service vending machines.

Costa Coffee is the world’s second-largest coffeehouse chain, after Starbucks, with 3,800 locations worldwide. The company employed 18,400 people last year and generated $ 1.7 billion in revenue.

Starbucks Competitor Costa Coffee is the only one selling and promoting nothing but its brand of coffee. Starbucks’ rivals have a diverse range of goods to choose from.

Coca-Cola paid roughly $4.9 billion to Whitbread in January 2019 to buy Costa Coffee. Costa’s 2020 net sales will be reduced by 19 percent because of store closures, but that’s still higher than the reductions suffered by competitors.

Costa Coffee was owned by Whitbread from 1995 until Coca-Cola purchased it.9 billion ($5.1 billion) in 2018. It has declared ambitions to expand aggressively into the Chinese market, intending to open 1,200 additional locations there. This corporation wants to create as many coffee shops as possible; thus, it advertises with the tagline “a coffee for every mile.”

Costa Coffee has also developed new products, such as canned coffee, which comes with less sugar and more caffeine, for its three most popular beverage lines (latte, caramel, and black American).

2. Dunkin Donuts

Dunkin’ Donuts is a well-known brand in the United States. Dunkin Donuts is the eighth largest chain of fast-food restaurants worldwide, behind Starbucks. The company employs more than 18,000 employees worldwide and operates in 33 countries due to Bill Rosenberg’s initial success in Quincy, Massachusetts.

Dunkin’ Donuts is one of the most popular coffee chains in the United States. The company was founded in 1950 by William Rosenberg in Quincy, Massachusetts.

Dunkin’ Donuts has over 11,000 locations worldwide and offers a variety of coffee, donuts, and other baked goods. The company has long been a competitor of Starbucks.

Dunkin’ Donuts was founded in 1950. It is a chain of coffee shops and donut shops. The company has grown rapidly and has over 11,500 locations in 35 countries worldwide.

Dunkin’ Donuts is widely known for its baked goods, hot drinks, iced drinks, frozen drinks, sandwiches, and soft drinks. Dunkin’ makes 8% of its donuts, 65% of its drinks, and 27% of its other food products. The company’s presence in 35 nations speaks for itself regarding success stories.

Dunkin Donuts has roughly 8,500 locations in the United States compared to Starbucks’ 15,000+. The yearly revenue of Dunkin Donuts is less than $1.5 billion, while the annual income of Starbucks is $23 billion.

3. McDonald’s McCafe

McCafe is a chain of coffeehouses that specializes in serving espresso-based coffee drinks. In addition to traditional espresso drinks, McCafe also offers a variety of frappes, smoothies, and baked goods.

McCafe is rapidly emerging as a serious competitor to Starbucks. McCafé was established in 1993 as a Mcdonald’s affiliate in Melbourne, Australia. The company sells a wide range of high-end espresso-based drinks in the United States and worldwide.

In recent years, McCafe has become one of the most popular coffee chains in the United States. Although it is owned by McDonald’s, McCafe competes directly with Starbucks and other major coffee chains.

McCafe coffee shop offers more than just coffee; it serves food and other drinks. A true reflection of espresso coffees, it was established in Australia in 1993.

There are a large number of locations throughout the world. This coffeehouse is a direct competitor of Starbucks, which has expanded its drinks menu beyond coffee to include smoothies such as Strawberry Banana and Mango Pineapple.

Starbucks, the second-largest market after the United States, will have over 4000 McCafé coffee stores by 2023. In both markets, it competes with Starbucks for customers.

McCafe was one of the top three coffee sellers in 2015, selling over $1.4 billion in coffee from just over 4,500 locations. The coffee shop has recently upgraded the equipment, so they expect to see better performance.

McCafe invested in new equipment to keep the quality of their coffee consistent. It currently holds the top spot in New Zealand and Australia in terms of size.

McCafe has been successful in attracting customers who are looking for a cheaper alternative to Starbucks. However, some coffee lovers believe McCafe’s drinks are not as good as Starbucks’. Regardless, McCafe continues to grow in popularity and now has locations all over the country.

4. Café Coffee Day

Cafe Coffee Day is one of the leading coffee chains in India. It is also one of Starbucks’ competitors. The company has more than 1,500 cafés across India. The company was founded in 1996 by VG Siddhartha. He started the business with just Rs. 15 lakhs. Today, the company is worth over Rs. 3,000 crores.

Cafe Coffee Day offers a wide range of coffee and tea products. They have both hot and cold beverages. They also have snacks and food items on their menu. The company has a loyalty program called ‘Coffee Day Rewards.’ This program gives customers discounts and offers on their purchases.

Cafe Coffee Day Enterprises’ subsidiary chain in India, Café Coffee Day, is a pioneer in the industry. Café Coffee Day became India’s largest coffee chain and expanded into Africa, Europe, and Asia.

VG Siddhartha began as a small business with one store in 1993 and now has 1722 locations spread across 200 cities in 20 countries. It made $ 131 million in revenue in 2017.

Cafe Coffee Day is known for its vertical cost reduction as it owns Arabica coffee plantations and manufactures furniture and coffee equipment for its retail stores. The brand has kept its prices low since it is popular with Indian students and youth.

First, it introduced a new logo that showcased the chain as a “place to chat,” which led to an interior makeover and the addition of lounges. In addition to a wide choice of drinks, its operation is centered on company-owned locations where it sells food and beverages such as cold coffee and smoothies. It also sells coffee that it roasts and roasts itself.

5. Tim Hortons

Tim Hortons is a coffee chain that started in Canada and has recently expanded into the United States. The company is known for its wide variety of coffee and baked goods and friendly service. Tim Hortons competes directly with Starbucks; many say it offers better value for your money.

In 1964, Tim Horton opened the first Tim Hortons in Hamilton, Ontario. Today, there are over 4,000 locations across Canada. Tim Hortons is known for its coffee and baked goods, but they also serve breakfast and lunch items.

Tim Hortons is often compared to Starbucks, both coffee chains. However, Tim Hortons offers a wider range of food items, and their coffee is less expensive. Tim Hortons also has a loyalty program where customers can earn rewards.

Tim Hortons is a well-known coffee and donut chain in Canada and one of the largest multinationals in the fast-food industry. It has 4,600 restaurants around the world, including the United States.

You can choose from a wide range of premium beverages on the menu, including teas, lattes, and cappuccinos. Additionally, it serves freshly prepared foods such as bread, muffins, paninis, and soup.

The first franchise was opened in Hamilton, Ontario, in 1964. It has spread across Canada, the United States, and worldwide since then. The Tim Hortons, coffee shop chain was founded by Tim Horton, a professional ice hockey player, and his business partner Jim Charade.

Tim Hortons now has over 4,800 locations, employs 6,200 people, and generated $ 3,29 billion in revenue in 2018. The corporation will gift nearly $8 million in coffee and hot beverages to customers in Canada this holiday season.

Despite being part of a Brazilian conglomerate, Restaurant Brands International, including Burger King and Popeyes, the brand has a solid connection to Canadian national identity.

Coffee from Tim Hortons costs around half as much as coffee from Starbucks. If you want a small cup of Caffe Latte, Tim Horton’s will only charge you $2.49, while at Starbucks, it will cost you $3.05.

Whether you’re looking for a quick caffeine fix or a place to relax and chat with friends, Tim Hortons is the perfect spot. The chain has something for everyone, with a menu that includes everything from breakfast sandwiches to soups to desserts. And, of course, there’s always a fresh pot of coffee brewing.

6. Lavazza

Lavazza coffee is known for its rich flavor and smooth texture. The company sources its beans from around the world, including Brazil, Colombia, India, and Ethiopia. This allows them to create unique blends that are beloved by coffee enthusiasts.

In addition to whole beans, Lavazza also sells ground coffee, instant coffee, and even single-serve capsules compatible with Nespresso machines.

In the coffee world, Lavazza is a name that’s synonymous with quality. The Italian company has been in business for over 120 years, and in that time, they’ve perfected the art of making a great cup of joe.

Lavazza is one of Starbucks’ biggest competitors, and its coffee beans are available in supermarkets and specialty stores worldwide. If you’re looking for an alternative to Starbucks, Lavazza is a great option.

Their coffee beans are roasted to perfection, and offer a wide variety of blends to suit every taste. Whether you like your coffee strong and bold or smooth and mellow, Lavazza has a perfect blend.

The Italian company Luigi Lavazza S.p.A. makes coffee goods. In 1895, the corporation opened its doors in Turin, Italy. It began as a modest corner grocery. The Lavazza coffee brand is well-known in Italy. The company has recently opened locations in the United States and other European countries. 

Lavazza provides ground coffee for use in Moka pots. Customers like the company in significant markets, such as the U.K. and the United States. Lavazza is in the same industry as Starbucks; thus, it’s a respectable substitute.

However, the company has been handed down through the Lavazza family for several generations and earned a solid market reputation. Lavazza also operates several standalone retail coffee shops. The Lavazza Blue professional capsule system is attracting office workers in the UK. 

This program offers a Lavazza coffee machine for £1 with a minimum purchase of 200 coffee capsules.

There are many different countries from which Lavazza imports its coffee. These countries include Brazil, Colombia, Costa Rica, Indonesia, Mexico, and the US. It is present in several countries as its brand or as a subsidiary of another company. 

7. Peet’s Coffee

Peet’s Coffee is a coffee roaster and retailer based in Berkeley, California. The company was founded in 1966 by Alfred Peet and today has over 200 locations. Peet’s is one of the most popular coffee brands in the US and is often considered a competitor to Starbucks.

A cup of Peet’s coffee is known for being rich and flavorful, with a strong body and bold aroma. The beans used to make Peet’s coffee are roasted using a traditional method that gives them their unique flavor profile. Peet’s offers a wide variety of coffee blends, single-origin coffees, and seasonal espresso drinks.

Peet’s Coffee is another Starbucks alternative that began as a coffee shop. This coffee roasting firm sells its products in a retail setting. The company was founded in 1966 and had its headquarters in the San Francisco Bay Area of California.

Peet’s Coffee has developed its company across various locations and has become a notable name in the coffeehouse chain’s business.

Peet’s Coffee is owned by the JAB Holding Company, which owns several other restaurants and coffeehouses. Whether you’re enjoying a cup of Peet’s at home or on the go, you can be sure you’re getting a high-quality cup of coffee.

Peet’s introduced darker roasted Arabica coffee to the United States in blends that included French roast and grades suitable for espresso drinks. In addition, the merchant sells freshly roasted beans, brewed coffee, and bottled cold brews. JAB Holding Company is a significant player in the coffeehouse and restaurant chain market.

Peet’s Coffee stands out from the crowd by using this brand. Peet’s Coffee reported revenue of $983 million in 2019. Peet’s coffee is sold in over 14,000 grocery stores across the United States. In 2016, the retailer made $800 million in sales. Over the years, the corporation has gradually increased its market share.

8. Kentucky Fried Chicken

Kentucky Fried Chicken is a fast-food restaurant chain specializing in fried chicken. Headquartered in Louisville, Kentucky, it has over 20,000 locations in over 100 countries.

KFC was founded by Colonel Harland Sanders, who sold fried chicken from his roadside restaurant in Corbin, Kentucky, during the Great Depression. Sanders identified the potential of the restaurant franchising concept, and by the end of the 1930s, he had sold franchises to over 600 individuals.

KFC popularized chicken in the fast food industry, diversifying the market by challenging the established dominance of burger chains such as McDonald’s. The company’s original product is pressure-fried chicken pieces coated with Sanders’ 11 herbs and spices recipe. The product is usually served with mashed potatoes, gravy, coleslaw, and biscuits.

KFC established and marketed fast-food chicken after opening its first location in 1952 through franchising and advertising. KFC is a well-known fast-food chain in the United States that specializes in fried chicken.

Col. Harland Sanders opened his first restaurant in Corbin, Kentucky, in 1939, and it quickly became a national success thanks to the secret sauce he devised for it.

The company has grown steadily since becoming the largest chain of chicken restaurants globally, employing 800,000 people and having 23,000 restaurants in 135 countries. The chain is expanding every six hours, according to reports.

The original advertising budget was roughly four million dollars for television advertising. KFC employed an advertising agent named ‘Leo Burnett’ in the late 1960s.

KFC became one of the most popular fast food companies in the United States in the mid-1970s thanks to the ‘grab a bucket of chicken’ Leo Burnett campaign. KFC is owned by Yum Brands, the company that controls Taco Bell and Pizza Hut.

KFC accounted for 49% of last year’s combined revenue of $ 49 billion, the highest of the three. Its biggest market is the United States, where 41% of its total sales are generated, followed by Asia at 30%.

You can find many chicken-based dishes, including chicken on the bone, chicken strips, and sandwiches. The menu has grown to include salads and side dishes, aside from french fries and soft drinks.

It offers coffee on its menu but has begun to establish its coffee shop. A concept similar to Mc Café’s, Colonel’s Café, has been operating in Japan since 2014, and a KFC Coffee Corner was introduced in Romania in 2017.

9. Dilmah

Dilmah is a family-owned Sri Lankan company that produces, markets, and exports Ceylon tea. The company was founded in 1988 by Merrill J. Fernando. Dilmah sells its tea in more than 80 countries and has been called the “Starbucks of Tea” due to its rapid expansion and international reach.

While Dilmah is not as well-known as some competitors, it has carved out a niche in the premium tea market and offers a unique product that appeals to discerning tea drinkers.

Srilanka-based Dilmah Ceylon Tea Company exports tea all over the world. Sri Lankan tea company Dilmah Tea Company was established in 1974 and is famed for its Silone Tea.

Dilmah t-lounges offer tea-inspired snacks and drinks in Sri Lanka, Iran, Indonesia, Kuwait, the UAE, and Brunei. They also sell their products to over 100 countries.

Dilmah Tea is becoming a global brand thanks to the advertising and endorsement of the team’s uniforms by Sri Lanka’s national cricket team. The company has built a solid name thanks to a genuine, natural, high-quality local product. MJF Teas and Ceylon Tea Services are also under its ownership.

Dilmah has maintained the concept of a tea produced and packaged in its area of origin throughout its history, resulting in a range of over 2,700 items.

Top Best Buy Competitors & Alternatives

According to Data-monitor, Ceylon tea, the parent company of Dilmah, was founded in 1981 and had an estimated revenue of $7.92 billion, with a net profit of $1.04 billion.

Dilmah owns a vast global distribution network, tea gardens, factories, printing and packaging facilities, and a printing and packaging facility. It employs 644 people and is present along the entire value chain.

Dilmah’s brands include herbal infusions, green tea, iced tea, and other flavors like masala chai and Ceylon tea.

10. The Republic of Tea

The Republic of Tea is a company that produces and sells tea, teapots, and other tea-related products. Founded in 1992, the company is based in Novato, California. The Republic of Tea’s product line includes more than 300 varieties of teas, herbs, spices, fruits, and vegetables.

The Republic of Tea sources its tea from more than 30 countries and sells its products through a network of more than 5,000 retailers nationwide.

The Republic of Tea has built a reputation for quality and innovation. In addition to its traditional black and green teas, the company offers a wide range of herbal, fruit, and white teas.

The Republic of Tea’s best-selling products includes Ginger Peach White Tea and Earl Greyer Black Tea. The Republic of Tea also offers a line of organic teas certified by the USDA.

The Republic of Tea is made from widely available organic ingredients. It is typically packaged in loose tea bags and comes in various tastes and colors, such as white and red tea.

The ingredients in The Republic of Tea brand are widely available organically. Loose tea bags with varied flavors and colors are used for packaging.

The hues in the tea come from the red and white wine produced by the Republican firm before it entered into the tea business in 1992. The brand has gained global recognition and an annual sales revenue of approximately $20 million due to rebranding and advertising initiatives.

The original wine manufacturer achieved global accreditation through rebranding and advertising, with projected annual earnings of over $20 million. The company’s best-selling items include hot apple cider, pumpkin spice black tea, ginger peach, and comfort, joy black tea.

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11. Folgers

Folgers is a coffee company that was founded in 1850. The company is best known for its Folgers Coffee brand, which is sold in the United States and Canada. Folgers is a subsidiary of The J.M. Smucker Company.

Folgers coffee was first introduced in 1876 and became widely available in stores by the early 1900s. The beans used to make Folgers coffee are grown in Central and South America. Folgers Coffee is roasted and then packaged at a facility in Missouri.

Folgers offers a variety of coffee products, including whole bean, ground, instant, and K-Cup pods. The company also sells teas, hot cocoa mixes, and baking mixes. Folgers has been a major sponsor of NASCAR since 1999.

Folgers offers pre-ground coffee that is easy to prepare, widely available, and considerably less expensive than Starbucks. The savings over time are more than sufficient to justify the lower price of Folgers.

Folgers Coffee Company has been in business since 1850. It is the oldest company on the list. Folgers does not provide the same service or products as Starbucks but can substitute.

Folgers is a coffee company founded in 1850 by James A. Folger. The company is headquartered in San Francisco, California, and is a subsidiary of The J.M. Smucker Company. Folgers coffee is sold in more than 30 countries and has more than 30 varieties.

Folgers coffee beans are roasted and then ground before being packaged and sold. The company also sells whole beans, ground at home, for a fresher cup of coffee. Folgers offers regular and decaf coffees, flavored coffees, and K-Cups for Keurig brewers.

Folgers Coffee is not a network of coffeehouses. However, it is a US-based ground, instant, and k-cup coffee brand. The company is focused mainly on the United States market.

For decades, Folgers has sold pre-ground coffee for home use and has earned a unique place in the hearts of consumers. Additionally, it conducts business in Asia, Canada, and Mexico. It is a subsidiary of J.M. Smucker Company and is included in its food and beverage sector.

Folgers specializes in coffee, so their products can be considered a substitute for those offered by Starbucks. The company’s products can also help clients spend less when buying coffee from chain cafes.

The company’s coffee products will reach 1.3 million households by September 2020, with packaged coffee sales increasing by 14% in September.

12. Tazo

When it comes to tea, there are a lot of different brands and flavors to choose from. But one brand that has become increasingly popular over the years is Tazo. So, what is Tazo?

Tazo is a tea company that was founded in 1994. The company is headquartered in Portland, Oregon, and offers a wide variety of teas, including black, green, herbal, and more. Tazo is also one of the main competitors of Starbucks.

One thing that sets Tazo apart from other tea companies is its focus on quality. All of their teas are made with premium ingredients, and they have a team of experts who carefully select each tea leaf that goes into their products. This commitment to quality has helped make Tazo one of the most popular tea brands in the world.

Tazo Company manufactures herbal tea. Starbucks purchased the project as a fieldwork project in Portland and rebranded it to become today’s company. Tazo Company is headquartered in Portland, Oregon, in the United States. Some of the company’s most famous tea brands are used as alternatives to coffee.

Tazo Tea is popular due to its distinct flavor, aroma, and therapeutic properties. Herbal tea is one of its most popular items. When comparing Starbucks’ competitors, such indirect competitors rarely fail.

Tazo tea is competitive because of its distinct flavor, aroma, and therapeutic benefits. Tazo’s revenues were anticipated to be $1.3 billion in 2010. It operates in over 46 countries and has over 17,000 shops under the Starbucks brand.

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Tazo currently serves clients in more than 46 countries through more than 17,000 locations managed by Starbucks.

Final Words on Starbucks Competitors and Alternatives Analysis

In conclusion, Starbucks has many competitors, but the company is still doing well. Some of the competitors are even using Starbucks’ success to their advantage. There are many reasons for this, including the fact that Starbucks has a strong brand and a loyal customer base. The company can offer a unique experience that many competitors cannot match.

They have a strong brand, a loyal customer base, and many locations. They continue to innovate and offer new products and services that keep customers returning. While many other companies are trying to compete with Starbucks, they have not been able to match their success.