Starbucks is in a rapid period of transformation as the world’s largest coffee chain shows its agility in the face of climate change and the pandemic.
And something’s working for the company — shares of Starbucks are up 55.58%, and over $34 billion has been returned to shareholders over the past four years.
It’s been a massive week of announcements for Starbucks — here are three key developments.
Starbucks CEO quits post
The conglomerate’s CEO Kevin Johnson has announced he is quitting the post in April after 14 years with the coffee giant.
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Johnson told the company’s annual shareholders meeting he’d “humbly accepted” the top job in 2017, knowing it carried “a great responsibility, a responsibility to all Starbucks partners”. (That’s Starbucks speak for employees, farmers, customers and communities).
“I think most days we got it right, but I know there were times we didn’t and when this happened, we learned and adapted. It’s what makes us better,” Johnson says.
Founder Howard Schultz is coming back — with an annual salary of $1 — to be interim CEO as the company forges through inflationary pressures, supply chain disruptions, labor costs, and unionisation efforts.
But Johnson left his mark — aside from a record fourth quarter, he is also the brains behind the “people positive, planet positive, and profit positive” framework that has driven key decisions at the company in recent years.
Starbucks ditches paper cups
In 2020, Starbucks announced an audacious goal to reduce waste by 50% by 2030 — no mean feat considering there are 32,660 stores across the globe.
But it looks like they’re taking it pretty seriously — the company confirmed plans this week to shift from paper to reusable cups by the end of next year in stores throughout the US and Canada.
Customers will be encouraged to bring a personal reusable cup for their drinks — a practice that fell somewhat out of use during the pandemic amid hygiene fears.
“We have a bold long-term sustainability vision and ambitious goals for 2030,” Johnson said in a statement.
“Starbucks partners around the world are passionate about protecting our planet and are at the very centre of driving the innovation that enables us to give more than we take from the planet.”
“Our goal, by 2025, is to create a cultural movement towards reusables by giving customers easy access to a personal or Starbucks provided reusable to-go cup for every visit, making it convenient and delightful to reuse wherever customers are enjoying their Starbucks experience,” he added.
Starbucks’ EV charging stations
The coffee giant has teamed up with Volvo Cars to install 60 smart car chargers at 15 of Starbucks’ locations near its Seattle base.
The partnership is all part of Starbucks’ efforts to embrace sustainability — charging infrastructure is seen as a major hurdle to electric vehicle adoption.
Volvo and Starbucks will both closely monitor the usage by EV owners with a scope to expand the program to the company’s other stores, according to a representative for the companies.
Installation of the chargers will kick off in the next few months and is expected to be ready for customer use by the end of this year.
The announcement of the green-minded Volvo partnership came just one day before Johnson confirmed his departure to the board.
Incoming interim CEO Schultz will not tinker with Johnson’s vision — which largely sparked the sweeping changes at Starbucks — but the founder is keen to provide a sense of stability to quell investor anxiety, analysts say.
“When you love something, you have a deep sense of responsibility to help when called,” Schultz says.
“Although I did not plan to return to Starbucks, I know the company must transform once again to meet a new and exciting future where all of our stakeholders mutually flourish.”