The Ledger
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Schultz: Starbucks introduced the caffè latte to America without trademarking it
“The other thing I didn't do is we introduced cafe latte to the, to America. We didn't trademark it. You know, we trademarked Frappuccino later on, but we didn't trademark cafe latte.”
Schultz: Starbucks was seven months from insolvency in 2008
“I went up there, and I laid it out. Chapter and verse. I think we have seven months left. We are going to be insolvent.”
Schultz: Starbucks Replaced Entire Executive Team Except General Counsel
“He was right, except for one, the general counsel. They were all gone.”
Schultz: Starbucks suspended buybacks to invest over $2B into partners
“The day I came back, and I knew what the market would do, is I announced that we were suspending the stock buybacks, and stock went down. I expected it, and I announced that we were going to take basically the money we were using to stock buybacks for the year…”
Schultz: Starbucks originally resold Peet's Coffee in Starbucks bags in 1971
“Now what is not known is that when Starbucks opened in the Pike Place Market in 1971, they were using Pete's Coffee. No one knows that. That's new. Because they were not roasting coffee. So they were bringing coffee from San Francisco to Seattle. They were not…”
Schultz: Starbucks ran into financial trouble after acquiring Peet's Coffee
“Now between 83 and 85, Jerry Baldwin, because of his love of Pete's and his relation with Alfred Pete, had an opportunity for Starbucks to acquire Pete's Coffee Company. And they did. Unfortunately, Starbucks buys Pete's, and they get into financial trouble.”
Schultz: Starbucks beverage retail achieved roughly 80% gross margins early on
“The ability to source and roast coffee And put that through the supply chain of a beverage gave us probably at the time an 80% gross margin.”
Schultz: Starbucks store model targeted 2:1 sales-to-investment and 20% operating profit
“The model basically was a sales to investment ratio of two to one. And a operating profit of 20%.”
Schultz: Starbucks spent zero dollars on marketing in its early days
“We didn't spend any money on marketing. Zero. It was no money for market in the cup. The iconic cup became a badge of honor because people were doing something that was new and novel and walking in the street with it”
Schultz: Starbucks Granted 14% of Base Pay in Stock Options Pre-IPO
“Ultimately we gave 14% of everyone's base pay in the form of stock options at the end of the year based on the strike price. And I had to do it the year before the IPO.”
Schultz: Costco Co-Founder Jeff Brotman Invested in Starbucks' 1987 Buyout
“First, Jeff Brotman invested in Starbucks in the round to buy Starbucks.”
Schultz: Starbucks and Pepsi launched bottled Frappuccino via 50/50 JV
“Subsequently, Craig Weatherup and I, on a napkin, I swear, shook hands and created a multi-billion dollar business For Pepsi and Starbucks and a fifty-fifty JV and bottle Frappuccino.”
Schultz: Starbucks secured China approval to insure employees' parents and grandparents
“Belinda decided that she could go to the government and go to an insurance company and come back to Starbucks and get government approval for Starbucks to do the first, do something had never been done before and provide health insurance to the parents and gra…”
Schultz: Starbucks sold no prepared coffee beverages until around 1985-1986
“Starbucks coffee company from 1971 until around 8586, only sold pounds of coffee. There was no beverage.”
Schultz: Starbucks had 11 stores and 100 employees at end of 1987
“August of 87. We bought the six Starbucks stores. We had the three old Eldranales, and there were two stores under construction. So at the end of the calendar year, we had 11 stores And a hundred employees in 1987.”
Schultz: Gloria Jean's Once Had More Stores Than Starbucks via Franchising
“That was Gloria Jeans out of Chicago. And at one point, I think they had more stores than we did because of the franchising opportunity.”
Schultz: Starbucks never paid for product placement in movies
“First of all, Starbucks never paid for placement.”
Schultz: Starbucks struggled and lost money in China for nearly a decade
“We struggled in China for almost a decade. Lost money. There was tremendous pressure inside the company of close China.”
Schultz: Starbucks never had a negative comp month before 2008
“Never had a negative comp month in my history of the company.”
Schultz: Starbucks JV Partners Run Operations While Starbucks Controls Roasting and Design
“Starbucks is responsible for roasting the coffee, for all the recipes which are consistent with Starbucks worldwide, A co design of the store where we're designing the store with the JV or the licensed partner, and they control all the operations.”