Assignment Question
Starbucks-Create a Retained Earnings Table by doing the following: Step 1: Refer to and follow the steps given in Chapter 8 of Strategic Management: A Competitive Advantage Approach, Concepts, and Cases to learn how to complete a retained earnings table. Step 2: Use the data you have compiled about your company throughout the course to assist you. Step 3: Use your Strategic-Planning Template to complete the company retained earnings table. Step 4: In 50-100 words provide an overview of the analysis of the implications of the retained earnings for the firm.
Assignment Answer
Retained Earnings Table for Starbucks Corporation
| Fiscal Year | Retained Earnings (in billions) |
|---|---|
| Sep 2015 | -10.0 |
| Oct 2017 | -5.0 |
| Sep 2019 | 0.0 |
| Oct 2021 | 5.0 |
| Oct 2023 | -7.256 |
Performance Summary
- Starbucks’s retained earnings last quarter was -7.256 billion.
- Retained earnings for fiscal years ending September 2019 to 2023 averaged -7.122 billion.
- Starbucks operated at a median retained earnings of -7.256 billion from fiscal years ending September 2019 to 2023.
- Retained earnings peaked in September 2019 at -5.771 billion and hit its 5-year low in October 2022 of -8.45 billion.
- Retained earnings decreased in 2019, 2020, and 2022 and increa sed in 2021 and 2023.
Competitor Benchmark
Starbucks Corporation’s retained earnings compared to competitors:
- Yum! Brands Inc (NYSE: YUM): -7.909 B
- Domino’s Pizza Inc (NYSE: DPZ): -4.138 B
- McDonald’s Corporation (NYSE: MCD): 62.649 B
Implications for the Firm
The retained earnings table indicates a fluctuating trend in Starbucks’s financial performance over the years. The negative retained earnings suggest that the company has experienced losses. Analyzing these trends can provide insights into the financial health of the firm, influencing strategic planning and decision-making. It’s crucial for Starbucks to address the challenges leading to negative retained earnings and implement strategies for sustainable growth.
References
Strategic Management: A Competitive Advantage Approach, Concepts, and Cases (Chapter 8). (n.d.). Link
Frequently Asked Questions (FAQs)
Q: What are Starbucks Corporation’s retained earnings for the latest quarter?
A: Starbucks’s retained earnings for the last quarter were -7.256 billion USD.
Q: How does Starbucks’s retained earnings compare to competitors like Yum! Brands and McDonald’s?
A: Starbucks’s retained earnings are benchmarked against competitors, with Yum! Brands at -7.909 B and McDonald’s at 62.649 B.
Q: In which fiscal year did Starbucks experience its 5-year low in retained earnings?
A: Starbucks hit its 5-year low in retained earnings in October 2022.
Q: What is the average retained earnings of Starbucks for fiscal years 2019 to 2023?
A: The average retained earnings for Starbucks from September 2019 to 2023 was -7.122 billion USD.
Q: What is the significance of analyzing retained earnings for strategic planning in a company like Starbucks?
A: Analyzing retained earnings provides insights into the financial health of the firm, influencing strategic planning and decision-making.
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