II. Analysis of the Problem:
A. Company Background and History:
a. Starbucks began in 1971 when three scholars-English teacher Jerry Baldwin-history teacher Zev Siegel, and writer Gordon Bowker- opened a store called Starbucks Coffee, Tea and Spice in the touristy Pikes Place Market in Seattle.
b. The inspiration and mentor for the Starbucks venture in Seattle was a Dutch immigrant named Alfred Peet, who had opened Peet's Coffee and Tea, in Berkeley, California, in 1966.
c. Starbucks Coffee at this time stood for making top-quality, fresh-roasted, whole-bean coffee which was its differentiating feature.
d. The company was created to build clientele in Seattle that would appreciate the best coffees and teas.
e. Baldwin and Bowker key mission for their business was to maximize the quality of the coffee. The company purchased the finest Arabica coffees and put them through a meticulous dark-roasting process to bring out their full flavors.
f. In 2000, Howard Schultz transitions from chairman and CEO chief global strategist; Orrin Smith is promoted to president and CEO.
2. Starbucks and Howard Schultz.
a. In September 1992, Howard Schultz was hired at Starbucks.
b. Schultz's 1983 trip showed him that there was much more to the coffee business than just providing quality beans. On his trip to Milan, Italy he had a revelation which made him see going to Starbucks should be an experience, a special treat, a place to meet friends and visit.
c. Howard Schultz presented his great idea to expand Starbucks to a retail business. They feared that providing drinks would hurt them because it could hurt the integrity of Starbucks' mission as a purveyor of fine coffees.
d. In April 1984 , Starbucks opened its sixth store which was the first of