The Rise of Starbucks
The Starbucks Corporation has enjoyed phenomenal growth since its early days in 1971 as a quaint coffee shop in Seattle, Washington. The rise of Starbucks can be directly attributed to the following factors; the emphasis placed on product quality, high employee standards, and creating the perfect cup of coffee.
How a small idea became a huge business. Growing up in Brooklyn Howard Schultz had no aspirations. His only goal was to escape the struggles his working-class parents lived every day (Schultz 107).
Eventually, Schultz discovered his talent for sales, and was hired by a Swedish housewares corporation. By age 28, he was vice president in charge of sales in the United States. He has an excellent salary, a co-op apartment in New York City and was happily married. However, Schultz wasn’t satisfied with all he had accomplished. He wanted to be in charge of his own destiny (107). It was then in the early 1980’s that he was introduced to the company, Starbucks Coffee and Tea. Starbucks’s original was modest but full of character. Schultz was immediately impressed by its charm. Importantly, he thought the coffee was wonderful (Schultz 108). He then had dinner with a friend, Jerry Baldwin owner of Starbucks and his partner, Gordon Bowker. Schultz tried to persuade Baldwin to hire him as an employee, even though it did not seem to be a logical career move. But for Schultz Starbucks held an inexplicable attraction. He soon found many reasons to get back to Seattle and visit (108). Then in the spring of 1982, Jerry and Gordon invited Schultz to meet Board member Steve Donovan. Schultz told the men what he saw for the future of the company. The partners seemed inspired by his vision. But they had decided not to hire Schultz. They felt his vision, was not what they had in mind for the company (108). Schultz still believed so much in the future of Starbucks that he couldn’t except “no” as an answer. He then contacted Baldwin and protested that he wasn’t selfishly interested in a job but it was more so about what he wanted to do for the company. Finally, Schultz had a job working at Starbucks (Schultz 109). Then, after working there for a year, he had a simple experience that changed his life. He traveled to Milan, Italy to attend an international housewares show. While, traveling he noticed a little espresso bar. The espresso bar brought to his attention the romance and ritual of a coffee bar. He realized that his company’s connection to coffee lovers did not have to be limited to their homes, where they ground and brewed the coffee. Instead, he imagined that, coffee should be sold by the cup, in coffee bars (109). On his return to Seattle, however, his bosses argued that Starbucks was a retailer, not a restaurant, or a bar. Schultz felt torn between loyalty to Starbucks and confidence in his vision for coffee bars. In the end he followed his vision. In 1985 he left Starbucks and started his own company, Il Giornale (Schultz 110). Within 6 months they were serving more than a thousands customers a day in their Seattle store (110). In March 1987 Jerry Baldwin and Gordon Bowker decided to sell their Starbucks stores. Schultz knew immediately he had to buy the company. So, with the support of his Il Giornale investors, Starbucks was his (Schultz 111). Starbucks now has more than 1500 stores and 25,000 employees. Unlike other retailers, they provide stock options and full health benefits, for even part-time employees (111). Starbucks’s goal is to become “the most recognized and respected coffee seller in the world.” To achieve this goal the company employee standards are extremely important. The Clinton administration has praised the company’s generous employee health care package (Simons 190). The company engages in philanthropic endeavors, as well: In many communities, it donates pastries to homeless shelters, and...
Please join StudyMode to read the full document