Starbucks resigns: success story of American Jews from poor families

Starbucks Chairman of the Board of Directors and twice CEO of Howard Schultz leaves the company. The media writes that he may become a candidate in the US presidential election. Schulz himself does not exclude this.

Фото: Depositphotos

Chairman of the Board of Directors and former CEO Starbucks Howard Schulz decided to leave his post after almost 40 years in the company. Reports about it RBC with reference to the website of the corporation.

«Starbucks Corporation today announced that Howard Schulz is leaving the post of chairman of the board of directors and a member of the board of directors, ”the statement reads.

64-year-old Schultz will officially leave his position on June 26. He will be replaced by Myron Ulman, who previously worked as CEO. Starbucks.

The departure of a businessman from Starbucks spawned speculation about his political ambitions, including plans to run for president in 2020, notes Reuters. In a conversation with a journalist on CNBC, Schulz himself did not rule out that he could pursue a career in politics.

"I would like to be honest with you, without creating new speculative headlines. For some time I was very concerned about our country - the growing inequality of the house and our position in the world. And I would like to understand what role could play in the work for the benefit of others. I still do not fully understand what this means, "said the businessman.

Success Story

Howard Schulz was born in Brooklyn, in a poor Jewish-American family. They lived in a quarter of houses for the poor, and the father, a retired military man, constantly changed jobs to feed his family, barely enough money. Schultz was surrounded by instability, poverty, lack of prospects and fear of the future, writes VC.ru

One of the most powerful episodes of childhood - when the father broke his leg. Lack of health insurance caused huge financial difficulties in the family. Then Schulz was thinking about creating a profitable company that would not depend on the “plaster on his foot.”

Photo by wikipedia.org

First job and transition to Starbucks

In 12 for years, Schulz began distributing newspapers, then selling food in a cafe, and in 16 for years he worked with fur - stretching skins. It made almost no money. According to him, it was a good quenching and strengthened his desire to achieve something in life. In addition, his mother influenced him well, talking about outstanding personalities who managed to change their lives.

In 1975, Howard became a bachelor of communication at the University of Michigan and took a job in Xerox. After working in the sales department for three years, he moved to the office of the Swedish manufacturer of household appliances Hamamaplast. In the sales reports, Schulz discovered large purchases of coffee grinders by a small firm. Starbucks in Seattle - much more than the famous coffee shops - and decided to go there.

In Seattle, Schulz met with the owners Starbucks: English teacher Jerry Baldwin, historian Zev Zigal and writer Gordon Bowker. They were united by a love for coffee - the trio knew the subtleties of choosing varieties and making a drink and opened a small coffee shop with varieties of their own roasting.

They dreamed of giving Americans a taste for good coffee. Starbucks formed on the cult of coffee, all employees had to know how to properly prepare it and teach customers.

However, at the end of the 1960s, people had already abandoned instant coffee, and either did not get used to ground coffee, or did not know about it at all, so there were few buyers. It was considered stupid to lay out big money for a coffee cake, which is also not clear how to cook.

But the approach and enthusiasm of the owners Starbucks he was so impressed with Schultz that he began to ask for a job at the company and throughout the year he took out his calls for director Jerry Baldwin. Schultz explained that Starbucks huge potential and need to open more stores. But Baldwin was afraid of change and believed that a sharp rise would kill the spirit of the company.

Starbucks development and Schultz care

A year later, Schulz changed tactics, proposing "to do everything gradually, in the usual pace for the owners, but to create something truly significant." After assessing the risks, Baldwin appointed Howard a marketing director, offering a salary two times lower than he had been Hamamaplast. He agreed without hesitation and moved to Seattle. At that time, four stores were opened Starbucks

Despite the efforts, the company grew slowly and stopped at several thousand regular customers. A new look was required, so in 1983, Schultz traveled to Milan.

Italian coffee houses differed from American ones: people not only drank coffee in them, but also had a good time at the tables, talking with friends or working, and the rooms did not remind of fast food, which Schultz really liked. The latte and cappuccino recipes he brought helped to increase sales threefold and interest buyers, but a new idea arose - to create a network of beautiful Italian establishments based on Starbucks.

Conservative owners Starbucks the idea was completely rejected, insisting that their goal was to train shoppers to make coffee. As a result, Schulz quit his job to open his own coffee shop chain. II giornale, took part of the money for it Starbucks, The rest is covered by a loan.

In his own cafe, he made a bet on comfort: he added the service “take-away coffee”, inside he played live music. On the first day, the cafe was visited by 300 people.

Фото: Depositphotos

Owners Starbucks failed to cope with growth: a year later they had to put up for sale shops, a roasting shop and a trademark. Schulz again took out a loan, promising to open 125 coffee shops in five years, and completely bought out the company, becoming the sole owner Starbucks

Starbucks Schultz

The first thing that Howard did was to install a bar counter and hired a barista who remembered customers by name, took into account their tastes and quickly prepared the right drink. To train the barista, Schulz went to Italy again, filming a video of how professionals pour espresso with one hand and whip the cream with the other, while communicating with visitors.

Starbucks developed aggressively: at first a stable income under the franchise model was adjusted Mc'Donald's, then several points were opened in new states at once: one belonged to the franchisee, the rest were owned by the company.

Another innovation that Schultz used was self-service. Clients chose the type of drink, its quantity, determined the volume of milk and its fat content - this attracted coffee lovers.

Active Advertising Campaign Starbucks Americans inspired romanticism, comfort and emotional atmosphere of coffee shops, and the slogans were remembered and uplifted. The words were confirmed by the case - Schulz wrote six principles Starbuckswhich employees were required to adhere to:

• Provide excellent jobs and treat each other with respect and dignity.
• Welcome diversity as an integral component of the path we have chosen in business.
• Apply the highest standards when purchasing, roasting and delivering fresh coffee.
• Work with enthusiasm, giving pleasure to customers.
• Make a positive contribution to our community and to creating the environment.
• Recognize that profitability is the key to our future success.

Good work was rewarded with bonuses and company promotions, and employees from the 20-hour work week received health insurance. This compensated for a small salary and reduced staff turnover.

Compromises for the people

Schultz tried by all means to increase the audience. Founders Starbucks sold coffee only dark roast, while Americans love light coffee, which you can drink several times a day. Schultz changed the principles and introduced a light roast, which was a great success - the average attendance Starbucks reached xnumx people.

California franchisees Starbucks found out that in summer the attendance of coffee shops falls as there are no cold drinks. Howard did not want to add something other than coffee to the menu, but it was also not profitable to lose customers.

Therefore in 1994 year Starbucks swallowed a chain of coffee shops The coffee connectionthat sold a cold frappuccino coffee drink (milkshake with ice cream and cappuccino). Drink with some changes entered the menu Starbucks with 1995 years.

Фото: Depositphotos

Californians believed fat milk to be deadly - Starbucks He introduced drinks with skimmed milk to the menu, despite the fact that it spoils the taste of coffee. And again, success - on the new had a third of orders of coffee with milk.

Gradually Starbucks departed from the concept of small Italian institutions, increasing the scale: placing comfortable sofas, tables and separate sitting places for meetings. Due to the number of coffee shops and menu items, the company partially switched from fresh coffee beans to high-quality powdered coffee, indistinguishable in taste from ground coffee. For this built a separate research center.

Schultz wanted visitors to feel at home, so the foundation Starbucks the comfort and atmosphere have become: all the institutions were built according to the same standards, the taste of coffee was the same everywhere, even the music in different cities had to play the same, synchronizing through the servers.

Many landlords Starbucks paid one dollar a year, as the popularity of the coffee shop attracted the attention of visitors to neighboring establishments. The company agreed to put points in disadvantaged areas, also for one dollar.

Фото: Depositphotos

Schultz's Care and the Fall of Starbucks

By 2000 year Starbucks opened 2400 coffee shops in the US, 350 in Europe, Canada, Asia and the East, and Schulz began to manage the global development strategy, and then completely went into the sports business, buying a basketball team Seattle SuperSonics.

Growth rates Starbucks slowed down, “related” goods were added to the sale of coffee: music, books and sandwiches, but this did not save - by the year 2007, the popularity of coffee houses had declined, and in 2008, the economic crisis began. Schulz had to go back and correct the mistakes of managers.

He got rid of the coffee brewing machines, behind which the cooking process was not visible, replaced the grain packaging to preserve the aroma of coffee, and developed a “Plan of Changes”, similar to that used in his time. Dell. It consisted of five points.

Authority

Until 2008, the company had only growth at the expense of new establishments, their quality declined, visitors left, the average check decreased. Schultz closed the growth program and released a blend of coffee Pike place roastfrom which they cooked in the first coffee house in Seattle. This demonstrated that Starbucks seriously engaged in coffee at various levels.

Use of technology

Schultz updated the company's website, opened a section with user ideas. Anyone could send their wishes - the best were introduced to all the coffee houses of the chain.

They also implemented a loyalty program, Internet access inside the coffee shop, contactless payment and an online ordering system.

Respect for the culture of the country

The design of coffee houses has changed, in each country - its own bias. For example, in China, added new dishes and tastes peculiar to this audience.

Ecology

The company introduced the processing of coffee grounds in fertilizer, reduced water consumption, and handed over glasses for recyclables.

Reduce costs

Schultz revised the bonuses and motivational programs of the staff, the company’s staff was reduced, the unprofitable coffee houses closed, the supply process was updated: if in 2008, seven orders out of ten came damaged or at the wrong time, then only one in 2009.

Фото: Depositphotos

Schulz managed to return the premium image Starbucks, remove excess bureaucracy and improve the situation in foreign markets. In 2016, Howard Schulz transferred the post of head of the company to Kevin Johnson, a former top manager Microsoft, considering that Starbucks need digital technology, and Kevin understands them better.

26 June 2018 Schulz will completely leave the company, having been awarded the title of honorary chairman. He believes that now Starbucks is in safe hands and will not repeat the collapse of the year 2008.

More than 37 million shares remain in Schulz’s assets Starbucks, making it the largest owner of the company. The second largest shareholder, Mellody Hobson, who is on the board of directors Starbucksc 2005 of the year, in the hands of 494 thousands of shares. With 290, thousands of shares closes the top three John Culver, group president Global Retail at Starbucks, previously responsible for the company's operations in China and the Asia-Pacific region.

To the question of how Schulz achieved such success, he replies that he is guided by four principles:

• Do not try to compete with those who are stronger and smarter than you.
• Go for any compromises, but do not give up convictions.
• Constantly improve your business, even if you are a true master.
• And remember - every little thing matters.

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