How Starbucks has changed the world of coffee and what you can learn from it.

How Starbucks has changed the world of coffee and what you can learn from it.
Last week I finally decided to buy a Starbucks card, a card that you deposit money in it and then every time you go to the store and use it, it will keep track and soon, after the fifth visit I think, you start earning some food items.
I had resisted for a long time to buy that darn card, but after visiting Starbucks and consuming some of their products, I finally decided that I was missing out on getting free drinks, coffee or whatever.
My favorite is the Java Chip Frappucino, Venti and now that they offer it fat free, I order the “light” which is their code word for non fat. I do this to kid myself, or at least to lower my caloric intake since I always order the chocolate brownie to go along the Frappucino.
What I do is the same thing that millions of people all over the world do every single day.
Even though this type of success is attributable to a team, the one man responsible for this is a guy named Howard Schultz. This man is the visionary who single handedly changed the way people drink coffee all over the world.
This success is the result of a big idea that became a reality for a young boy who was raised in Brooklyn, New York in a housing project, another name for a very poor neighborhood.
I tell people all over the world that I worked for Xerox for six or seven years and I believe that what I learned in that company had a lot to do with the results I have had in my life.
I am very proud to say that Howard was hired by Xerox and he went through our Sales training program which at the time was the best in the world. In Xerox University in Leesburg, Virginia, he learned all about selling skills, presentation techniques, and marketing and went out into the streets to make forty to fifty cold calls a day. That my friends, is a tough thing to do and yet Howard remembers his days at Xerox and I can quote what he said: “Cold calling was a great training for business. It taught me to think on my feet. So many doors slammed on me that I had to develop thick skin and a concise sales pitch”.
This is an important lesson for all of us. All the experiences we go through in our life, will serve us sooner or later. We accumulate knowledge and skills and when we least expect it, we will be using it to further our career and get us closer to our goals.
Very surprising to me, he left Xerox, a heck of a company, to join a virtually unknown Swedish company named Perstorp, where he rose through its ranks to land a position as head of US operations for its Hammarplast house wares subsidiary. It was working at that company that he discovered a little tiny retailer in Seattle named Starbucks Coffee, Tea and Spice Company. This company was buying an unusually large amount of drip coffeemakers and Howard decided to see what was going on.
He describes his visit to the store as “the minute the door opened, a heady aroma of coffee reached out and drew me in…By the third sip, and I was hooked”. On the flight back to NY the next day, he couldn’t stop thinking about Starbucks.
Look at what he tells us: “I believe in destiny. At that moment, flying 35,000 feet above the earth, I could feel the tug of Starbucks. There was something magical about it, a passion and authenticity I had never experienced in business”. I don’t believe in destiny, but I do believe in recognizing an opportunity when it presents itself, in reality, nothing to do with destiny, but this is not the point.
He decided that he wanted to work for that company, and doggone, he was going to do whatever it took to convince them to hire him. It took over a year to convince Starbuck’s owner, Jerry Baldwin, to hire Schultz. Using the Xerox sales skills, specifically how to overcome objections, he was able to be to overcome Jerry’s biggest objection that had to do with Howard’s vision and style which could clash with the culture of that little tiny retailer.
Clash it did, and in a big but positive way.
He took a huge pay cut and a very small equity share as one of its owners to join Starbucks.
But as he has declared in interviews, “for my part I saw Starbucks not for what it was, but for what it could be”.
Have you been in a position where you have to look farther down the road to identify opportunities that are not seen in your present situation? Are you capable of doing that? It is one of the most important skills in this competitive world we are living in. Be able to identify possibilities not seen by everyone else at the present time.
When Howard joined Starbucks, they only sold coffee beans, not coffee by the cup. I tell you, you can’t make up this stuff. Can you imagine Starbucks today and think that they didn’t sell you a cup of coffee.
It was during a trip to Italy that Howard experienced the coffee bar experience of neighbors getting together to share a cup of espresso and conversation, probably about politicians, the crime rate or the state of the world and it was then and there that he had his big idea: Starbucks had to change because it had missed the point, totally missed the point. What they needed to do was take advantage of the personal relationship that people could have with coffee, its social aspect. He said “I couldn’t believe that Starbucks was in the coffee business, yet was overlooking so central an element of it”.
Well, guess what happened? He goes back to the US, all fired up and enthusiastic about his new vision for the company, and he hit a wall. The owners didn’t get it. They didn’t see the company as a restaurant and felt that becoming one, would betray the mission they had when they opened the business.
Perseverance always wins, well, almost always. In Howard’s case it won. After a year, they gave him permission to sell espresso coffee in one of their stores, a little 300 square foot store that didn’t even have one chair for anyone to sit on. Well, it got packed with clients and by the time the tired employees closed the store, they had doubled the amount of customers of its best performing store in their chain.
And, you know what? In spite of this, the owners simply couldn’t change. They still stuck to their old idea and he hit a brick wall. They probably allowed him to do it because they thought he was going to crash. He didn’t and they were in a bind.
This is when men and women prove themselves. This is when adversity hits you on your face and whatever you do will determine whether you win or lose in life.
Quoting Howard: “This is my moment. If I don’t use this opportunity, if I don’t step out of my comfort zone and risk it all, if I let too much time tick on, my moment will pass. I knew that if I didn’t take advantage of this opportunity, I would replay it in my mind for my whole life, wondering: What if? Why didn’t I” This was my shot. Even if it didn’t work, I still had to try it”.
Go and take a pair of scissors and cut out this quote and paste it in front you in your desk, your refrigerator or wherever you can see it every single day. This way, when an opportunity presents itself, you will be ready to take the plunge.