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Can Other Companies Learn Anything New from Starbucks?

To a large extent, all businesses have to abide by the same market forces when striving to succeed. Yet some of them manage to pull far ahead by making certain types of decisions that can be carefully studied and then adapted to other industries.

Given its level of success, Starbucks has surely made decisions that can prove very instructive to other companies – especially those struggling to establish a brand, understand what consumers really want, and provide their products and services in the most pleasing manner possible.

Here’s a quick look at some of the key periods in Starbuck’s history, along with a brief overview of what it’s doing today.              

How Starbucks First Got Its Start

As is widely known, CEO Howard Schultz’s huge chain of coffee stores has spread rapidly all across America and over many other parts of the world. However, its beginnings were quite humble.  

According to “The 50 Best Businesses,” this company first opened its doors as the Starbucks Coffee Company back in 1971 in Seattle, Washington. It was just a coffee bean shop at that time. Some years later, Schultz landed a job there and then purchased the company’s retail unit in 1987. He soon shortened the name to just Starbucks. (Prior to purchasing the company, Shultz had opened another coffee shop named Il Giornale. It was this little shop that he actually renamed Starbucks after he purchased the Starbuck Coffee Company retail unit.)

Examples of Some Risky but Potentially Insightful Starbuck Moves Possibly Worth Emulating

  • The company has aggressively branched out and sold other products -- marketing some of them to large grocery store chains. Schultz was willing to take a chance on offering customers the company’s own brand of coffee ice cream and various baked goods. He also made sure its coffee could be easily purchased in upscale grocery stores;
  • Schultz decided against franchising his business – allowing himself to stay in complete control over the quality of the services provided and other key aspects of the business. He also displays a certain wizardry when choosing the best locations for his stores;
  • Early steps were taken to minimize waste of various required products. Efforts were made early on, according to “The 50 Best Businesses” text to make sure side products like milk were not wasted by “innovating a serrated internal ring [in company equipment] to guide how much milk should be poured” into each cup;
  • Schultz continues to try new ways of providing his product to customers. The company is building roughly 1,500 drive-through shops all across the United States during the next five-year period. In addition, Starbucks has recently “teamed up with Swiss Federal Railways (SBB) to unveil the first railway carriage converted into a coffee shop.” Finally, the company has made it possible for its customers to obtain prepaid cards for its goods (and back in 2002) opened up an “innovative ordering system, where customers can pre-order and prepay for items via phone or on the website.

The Company’s Current Status

Today, Starbucks has hired nearly 150,000 employees.  According to the book which details the rise of this coffee drink powerhouse, “Pour Your Heart Into It: How Starbucks Built a Company One Cup At a Time,” CEO Schultz claims that all he really did was capitalize on Americans’ need for another place, other than their homes or offices, whether they could regularly gather together to simply visit with others and create new friendships.                                              

Although the company has fallen on some difficult times during its lengthy history, Schultz has always willingly jumped back into the fray to rescue and revive it. It is now worth nearly four times what it was at one very early point in time. In fact, the company now reports income of approximately $13.29 billion.                                                                                            

Starbucks continues to be unique due to its high quality products and because of its early commitment to providing excellent employee benefits, even to its part-time workers.

To obtain help with handling all of your Georgia business planning needs, please contact the Law Offices of Shane Smith today.  You can schedule your free initial consultation with a knowledgeable Peachtree City estate planning attorney by calling: (770) 487-8999.


Shane Smith
Advocate for the Seriously Injured in Georgia