The-star-of-Starbucks

Unit8The Starof StarbucksEpisode1:Who wouldhave believedthat Americanswould lineup bythe millionsto pay$4fora cupof coffeeWho wouldhave imaginedwed goto a coffee shopand casuallyask foradouble tall,one pump,vanilla skim,caramel macchiatowhat theheck isa macchiatoanywayWell,the guywho didbelieve isHoward Schultz,the starof Starbucks.Schultz isgivento leapsof imagination-he hadto be,as hestarted outas apoor kidin Brooklynwhosold hisown bloodjust toget throughcollege.Today,as headof a$29billion multinationalcorporation,Shultz isnot withouthiscritics;some mockinglycall StarbucksFourbucks.But whenwe metSchultz,we foundasalesman anda showman,who iscreating hisown subcultureand intendsto takethe wholeworldalong.Episode2:At theStarbucks headquartersin Seattle,they dontdrink coffeelike youand me.Thats HowardSchultz analyzingeach slurp,as thoughhes lettingyou inon asecret.Schultz:You tastethat earthinessLike aBordeaux wine.”Correspondent:That ispretty good”Schultz:Thats something9Correspondent:Thats something/9Here peoplecalled coffeemasters”talk aboutfinding romanceand passionin a cuplike theywere creamand sugar.Schultz hasbrewed upacoffeeculture thats,sometimes,alittle hardto swallow.Schultz:One ofour colleaguescoined aphrase along timeago andsaid,‘Were notin the businessof fillingbellies.Were inthe businessof fillingsouls.“Correspondent:Oh,now,come on.No,wait aminute.Thats too...this isa company.This isa corporation.Come on/9Schultz:OK,it isa corporation/9Correspondent:Youre blowingsmoke now.”Schultz:No,I meanthis ishow wefeel.You mightsay,OK,they9re fullof crap/And you know,this ishow wefeel.Were inthe businessof humanconnection andhumanity,creating communitiesin athird placebetween homeand work.”Correspondent:I gotto tellyou Fvcbeen kickingaround yourheadquarters hereforthe lastcouple ofdays and Ill admitif youlet meuse adifferent beveragemetaphor../9Schultz:OK.Correspondent:The peoplearound herereally seem to bedrinking theKool Aid,they reallyseemto be completelysteeped,to useanotherbeverage metaphor,in thisphilosophy bit.”Schultz:But itsnot acult,this isa corporation,it isa for-profit business.But ourapproachfor30-plus yearshas beenunique anddifferent,not better,just different.”That approachcreated a company that now doublesits salesevery threeyears.Correspondent:How manystores areyou openingas wespeak”Schultz:“We have11,000stores in37countries.If san unbelievablenumber to me,tobe honestwith you.We areopening fivenew storesa day..・”Correspondent:Thats anew storevery fivehours,24/

7.”Schultz:“Yeah.”There reallyare Starbucksacross thestreet fromeach other.They dothat tocut downon the lines.Starbucks saysit has40million customersa week,40MILLION.And itbrews227million gallonsof coffeea day.Episode3:The operationthat feedsthat monsteris massive.Have alook atthis roastingplant thatwetoured outsideSeattle.They shipin greencoffee beansfrom28countries.This plantwillgo throughup totwo millionpounds ofbeans ina weekand there are fourplants justlikethis one.Starbucks has become sopervasive itspliced itselfinto thenational DNA.Correspondent:“There sa bitof aStarbucks blowback.”Schultz:Sure.”Correspondent:Rolling intotown,crushing thelife out of themom andpop coffeeshop.”Schultz:“We areso differentand when people understandthat,they welcomeus.Forexample,first off,we createdan industrythat didnot exist,and inour wake,the momentofStarbucks,so manylocal andregional companiesand momand popshave notonlysurfaced,but succeeded.”Still,Schultz hasfelt thewrath of anarchists,who trasheda Seattlestore inanantiglobalization riot.Correspondent:There isa criticism,and youveheard it...”Schultz:Yeah.”Correspondent:...that Starbucks is homogenizingthe world;that youretaking thecultureout ofplaces inChina andJapan andAmericanizing them.”Schultz:Ive heardthat.”Correspondent:And itirritates you.”Schultz:Its notthat itirritates me.Its just,you know,its offbase.Correspondent:And whenpeople sayyoure anevil empirebent onworlddomination,you say”Schultz:“I hatethat.I hatethat,but Irealize yourealways going to havecritics.”Episode4:This is the originalStarsbucks,a smallstore withno bigplans.It openedin1971onSeattle9s seafront,starbuck isthe nameof acharacter inthe novelMobb Dick.Here inthe Pipeplacemarket,there issalt inthe airand salmontoo.Schultz camehereas anappliance salesmanpushing coffeemarkets.He stoppedat Starbucksto makea salescall.Schultz:When I walked inthis storefor thefirst time,I knowthis soundsreallyhokey,I knewI washome.”So hequit hisjob andwent towork inthe store,which at the timewas sellingjustbeans andmachines.Adding anespresso barwas hisidea.A fewyears later,he wasoffereda chanceto buyStarbucks,which bythen hadgrown tosix Seattlestores.He setout tofindinvestors.Schultz:If Icame toyou in1987andIsaid toyou,even thoughcoffee consumptioninAmerica isdown,I want to buildacompanythat wasgoingtosell coffeenot inaporcelain cup,but ina papercup,with Italian-saying wordsthatnoone couldpronounce,for$3acupof coffee,would youinvest”Correspondent:Absolutely not.”Schultz:Okay,well,you wouldhave hadlot ofcompany.”But ifI hadinvested$10,000at thestart,it wouldbe worthmore than$5million today.How didhe do it Withmarketing and salesmanship andeven,he admits,a littlehype.Correspondent:“But pleasetell Americanand therest of the worldwhy thesmalldrink iscalled thetall”Schultz:Well,I think,youknow,when youwalk intoa store,you dontwantto say,give mea small.You wanttosaygive mea tall.And so,theres a little bitfor marketinginthere.Schultz likesto tellpeople thatStarbucks isjust asimple coffeecompany,but behindcloseddoors,theres aStarbucks laboratoryinventing nextyears drinks.They arebased onthingslike newcar colors.Jim Donald,the companysCEO,showed usaround.Jim Donald:“It takesour beveragesfrom thestate of ideation tothe actualdevelopmentthat yousee goingon rightnow.”Correspondent:The stateof ideationJimDonald:The sateofideation.Beverages haveto becreated.And theyrecreatedby lookingat whattrend isin,say,the fashionindustry,what colorshot rightnow.”They thinkgreen ishot andso theydeveloped somethingcalled a“Green TeaFrappuccino/9At Starbuckstoday,therearenow55,000possiblecombinations.Correspondent:Cinnamon dolcelatter.Vanilla whitechocolate mochaCaramelsense ofentertainment andexcitement andelectricity,you wantto bethere.”Its notjust coffeeanymore.Starbucksistheater.Bar Tender:And Jenny,you havea grandepeppermint lattelite withmocha.”That showmanshipandsalesmanshiphave madeSchultz somethingclose toabillionaire.Episode5:Correspondent:So thisistheold neighborhood^But thatis somethingthat hecould neverhave imaginedas aboy.Schultz grewupbroke livingwith thispublic housingproject inBrooklyn.There arebullet holesinthedoorleading toapartment7G.Schultz:“OK,there ismy apartment.”Correspondent:“When youwere livinghere atthe endof the hallway,age15,age16,what wouldyou wanttobeWhat wasyour dreamSchultz:You know,my dreamwas toget out.It was,I neverallowed myselftodream beyondthat.I was afraid todream beyondthat.”Dreams,he toldus,seemed futileafter hisfather,Fred,was injuredon the job.Schultz:“This isthehallwayIwalkeddown atthe age of sevenand openedthat doorandsaw myfather ona couchwith acast,and../9Correspondent:He brokehis legon thejob.”Schultz:He brokehis legonthejob.He wasa deliverydriver,picking upanddelivering clothdiapers.Terrible job.99Schultz:When hefell onthejob,he basicallywas turnedloose.He wasout ofwork.There wasno hospitalization,no healthinsurance,no workmanscompensation andwewere doneasafamily andI sawthe hopelessness,I sawthe plightofaworking classfamily,I sawthe fracturingoftheAmerican dreamfirst handattheageofseven.That memoryscarredme.”So,now Schultzhas organizedhis companyaround thatmemory.He provideshealthinsurance toemployees whowork aslittle as20hours aweek.He raisedprices todoit.And nowStarbucks spendsmore onhealth carethan itdoes oncoffee.Schultz:What Ivesaid toour ownpeople isthat we will not—youre neversupposedto saynever,but Isaid never-wewillnever turnour backon thisbenefit forour people/5When youpay fourbucks forcoffee,youre fundingSchultzs socialagenda—thehealth care,stock optionsfor employeesand more.He paysfarmers higherthan marketratefor beans.Schultz gotoutofhere,but somethingabout itnever lefthim.Correspondent:What wereyou thinking”Schultz:Just everythingthats happenedtomesince,standing here,how manytimesI walkedthrough thatdoor,I thinkthere weremany momentswhenpeoplesaid,not tomedirectly,but Iremember hearingthings that,Dont aimtoo high.Not myparents,butpeople.Youre fromBrooklyn,youre fromthe projects.Dont aimtoo high.“All theseyears later,Schultz isaiming toat leasttriple thenumber ofstores to30,000worldwide.He thinksthat Chinamay behis biggestmarket andhe hasnearly400stores intheregion already,including onein BeijingsForbidden City.What wasonce acoffee barhasbecomea marketingmachine foran expandingentertainmentbusiness.It producesits ownmusic and,this week,Starbucks opensits firstmovie.Its called“Akeelah andthe Bee”as inspelling bee,a feel-good filmabout apoorkid whotriumphs.“Prestidigitation“means skillin pullingof illusions,like amagician.Howard Schultzadmitsthere wasmore thanalittlesleight ofhand inconjuring upStarbucks andturningthe dullest,most commondrink inAmerica,into somethingmysterious.。