1 Introduction In order to determine their future plans, companies must first be able to understand not only their internal position, but also their external environment and how this affects their potential growth . This paper seeks to discuss the impacts that the external environment has on Starbucks, a world-renowned coffee shop chain, and provide overall recommendations to take advantage of the opportunities presented and mitigate any serious threats to its core businesses.1.1 StarbucksStarbucks has started its humble beginnings at one point. small store located near Pike Place Market in Seattle (http://www.starbucks.com.sg/our-heritage.html). The company prided itself on roasting high quality whole bean coffee and producing some of the best coffee on the block. Today, more than forty years later, Starbucks has grown into one of the world's leading coffeehouse chains, with more than 18,000 stores across 62 countries.1.2 Main OperationsStarbucks' main operations involve the sale of their beverages, their retail and franchise operations, while providing the Starbucks experience to its customers. As stated in Starbuck's mission statement: "Our mission: to inspire and nourish the human spirit – one person, one cup and one neighborhood at a time." (http://www.starbucks.com.sg/mission-statement.html). This statement shows that Starbucks is not only creating a business based on its products and services, but also aims to establish a closer connection with its customers through a “person to person” approach. Through Starbucks' experience with customers, it allows them to attract and retain customers without extensive marketing, but instead relying on their customers to attract more customers. In order to reach the middle of paper, ...... and has further diversified its business into several other means in the field of consumer goods such as Tazo Tea Company, Evolution Fresh which produces a range of fruits. fruit juices and smoothies and ethos water, bottled water. It should consider further diversifying its activities into the hotel and airline sectors. Tourism is one of the fastest growing economic sectors and is closely linked to the development of new destinations. With the high demand for air travel and increasing customer load on airlines and hotels, Starbucks can lead the way in providing premium coffee and other relevant products to airlines for services to onboard flights or to hotels for their daily use during meal services and other ad hoc basis. They also have a research and development team to offer coffee machines and products specifically for airlines and hotels..