How Starbucks Became An $80B Business

  • Published on Jan 10, 2019
  • In its 47-year history, Starbucks has transformed from a single coffee bean store in Seattle to a 30,000 cafe international coffee power house. But massive expansion hasn't come without growing pains.
    It's no secret that Starbucks has been struggling to get U.S. customers to frequent its cafes more often. While sales have been positive, the number of customer visits continues to stagnate.
    Same-store sales, a key metric in the restaurant industry, have dwindled over the last 12 months as competition heated up and customers were uninspired by some of Starbucks' limited-time offerings. While comparable-store sales exceeded expectations in the fourth quarter that ended Sept. 30, rising 4 percent, much of that was due Starbucks charging more for its lattes.
    Under the careful watch of Howard Schultz, Starbucks pursued a strategy of aggressive expansion in the late '80s and early '90s. By the time the company went public in 1992, it had 165 stores.
    Four years later, Starbucks opened its 1,000th location, including international cafes in Japan and Singapore. Growth was so rapid that, just two years later, Starbucks opened its 2,000th cafe.
    While unit expansion helped boost sales throughout the last two decades - Starbucks has had positive same-store sales growth since 2010 - the company has now spread itself too thin.
    With more than 14,000 locations in the United States alone today, Starbucks has cannibalized its own sales. The company is regrouping and rethinking its expansion. It is expected to shutter 150 underperforming locations in 2019, three times the amount it typically does.
    Compounding its problems are changing consumer preferences, an issue CEO Kevin Johnson has addressed with investors. People are shying away from sugar-laden calorie bombs, which happen to be one of Starbucks' staples. In 2015, sales of Frappuccinos were 14 percent of Starbucks revenue. However, in the first half of 2018, Frappucino sales were down 3 percent - and accounted for only about 11 percent of the company's revenue.
    Making matters worse, Frappuccino sales also were hurt by a lack of innovation, analysts said.
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    How Starbucks Became A $80B Business

Comments • 767

  • Rikesh Patel
    Rikesh Patel 14 hours ago

    cnbc has made this video 10 different times

  • Harman Enterprises

    Now Starbucks is taking a page from businesses like Blue Bottle whose coffee is far superior! I always felt as though Starbucks coffee had a burnt taste to it. They’re even copying Blue Bottle’s approach to having those glass coffee filtering devices that liken the environment to a science lab.

  • Vitalii
    Vitalii 4 days ago

    I visited first time in many years , paid $3.35 for regular coffee, never again 🤣

  • Pierronimo
    Pierronimo 5 days ago

    In France, coffee is considered as a cheap popular stuff not luxury at all and we only drink small shots of espressos. And it ranges from 1 euros to 2 euros. It is also a social product that you drink with your colleagues and pay for them because it's so cheap ("May I offer you a coffee?"). You don't want to pay for them if it's a starbuck though... can't spend 10 euros on 2 coffees... This is why there's only 170 starbucks in France (80% of them in Paris and targeting the tourists) compare to 1000+ in the UK.

  • 애플사장
    애플사장 6 days ago

    People are drinking not a Coffee but the mood Starbucks provides

  • Ed Must
    Ed Must 7 days ago

    if you look close, its crazy to spend 12 bucks on coffee... but can't deny that going to starbucks is a nice experience, you get your name on the cup, get a smile from the barista, the wifi password and the hippies with their macs. pretty urban

  • Devaster Oner
    Devaster Oner 9 days ago

    Starbucks employees working minimum wage, $7 HR.

  • Vill Bill
    Vill Bill 9 days ago

    I prefer coffee bean

  • Shwetha Jagannath
    Shwetha Jagannath 12 days ago

    Background Music is too loud. :(

  • Chang Gao
    Chang Gao 12 days ago

    The quality is consistent

  • King's React Gaming
    King's React Gaming 14 days ago +1

    White girls and overpriced coffee, so that’s a flex if you’re drinking Starbucks

  • Michael Dabellus
    Michael Dabellus 20 days ago

    Their coffee is bitter...prefer Dunkin

  • Butterfly
    Butterfly 23 days ago +1

    I don’t get the hype here in Germany we have good alternatives I think so Starbucks is not my preference

  • A dina
    A dina 24 days ago +1

    Most people who get Starbucks coffee do it mainly to show off!

  • I l
    I l 28 days ago +1

    1. Bad coffee
    2. Expensive
    3. Unsafe Wlan (get your creds stolen)
    4. WTF?

  • Miss MissyX
    Miss MissyX Month ago

    But there are no *commercials*

  • Brand Diaries
    Brand Diaries Month ago +1

  • H C
    H C Month ago

    Why is the music at the end so loud. Can barely hear the narrator.

  • Thy Ngo Ngoc Mai
    Thy Ngo Ngoc Mai Month ago

    what is the background music

  • Andy Dany
    Andy Dany Month ago +1

    Favorite restaurant and franchise

  • Andres Rodriguez
    Andres Rodriguez Month ago +1

    How to be rich
    1. Put a Starbucks on a college campus
    2. Wait

    • Gustav Peter
      Gustav Peter Month ago

      We have Starbucks coffee on campus. However, I always buy the coffee for £1,20

  • Kratagya Agarwal
    Kratagya Agarwal 2 months ago +2

    Starbucks became an $80 billion company because 100 million fools bought a $4 coffee ,200 times a year
    Do the Maths.

  • Dayton Stockwell
    Dayton Stockwell 2 months ago

    The first international Starbucks was in Vancouver BC lmao

  • Krystal Bizx
    Krystal Bizx 2 months ago

    Why not make your coffee at home for under $0.25? Saving your daily $5 coffee fund instead and putting it into an ETF or Mutual fund you'll have $36,727 in savings in just 10 yrs with at least a 10% ROR ---- the beauty of compound interest. Most ETFs and Mutual funds do better than even better.

  • Shermta F
    Shermta F 2 months ago

    I wonder where did I get a coffee beans from

  • KennethSNSDSone SMTOWN
    KennethSNSDSone SMTOWN 2 months ago +5

    *it saddens me when founders aren't part of this company anymore. 😥*

    • KennethSNSDSone SMTOWN
      KennethSNSDSone SMTOWN 8 days ago +1

      @fnihp30 based on the video, they sold all their shares in the company tho... 🤷‍♀️

    • fnihp30
      fnihp30 8 days ago

      Perhaps they don’t want to be. Besides, who said they didn’t still own shares of Starbucks...

  • Scott OBrien
    Scott OBrien 2 months ago

    Great video 👍🏽, putting dublin on the map aswell 😅😉 @5:32

  • kevin ltr
    kevin ltr 2 months ago

    bonjour les 1eresSTMG2

  • mary jane
    mary jane 2 months ago +4

    I'm proud to say that I haven't bought a Starbucks drink in over 10 years

  • Gabe B
    Gabe B 3 months ago

    Did she say eXpresso? I even rewinded to listen again coz I couldn’t believe my ears 😂 and there it was again.. “eXpresso machines”

  • Angelo Flores
    Angelo Flores 3 months ago

    that CEO is really a hardworking and have passion in his expertise

  • Yaro Berlishenko
    Yaro Berlishenko 3 months ago

    Omg did she say EXPRESSO?..... Uuughhhhh

  • Aman singh
    Aman singh 3 months ago

    Starbucks,now a tata company

  • Syarifah Maqhfirah Arsali

    Is Starbuck part of START-UP COMPANY? If no, why they success?

  • Hypax
    Hypax 3 months ago

    Lol i work there so i get unlimited free drinks

  • SSM 11
    SSM 11 3 months ago

    Starbucks pricing culture - Real Price of coffee +Price for hype + tip

  • Chris M
    Chris M 3 months ago

    Starbucks failed here in Australia at first, because of its below average coffee. Seems to have come back and be quite popular since the recent surge of Chinese and Asian immigration.

  • viktor m
    viktor m 3 months ago

    Couldn't make it in Australia apparently the corner cafes makes REAL coffee

  • FuddyduddyBella
    FuddyduddyBella 3 months ago +4

    I get a venti for free every time I go!!!

    Cause I work there. 😅

  • Alejandra Salgado
    Alejandra Salgado 3 months ago +1

    I'm watching this as I'm in Starbucks 😂

  • Abu Feras Abdullah
    Abu Feras Abdullah 3 months ago

    Great reporting, albeit the annoying music

  • Timothy J. Roberts
    Timothy J. Roberts 4 months ago

    I really want tp visit the Japan Reserve Roastery. It looks awesome. Theres a good video on youtube on that location.

  • God
    God 4 months ago

    Doesn't matter how expensive it is if it's actually good

  • arturo j guzman
    arturo j guzman 4 months ago

    Let’s face it, yes ! Over priced coffee, but is worthy ! A variety of good coffee, professional baristas , good sandwiches and snacks, attractive place and ambience, I have tried different coffee places, nobody makes coffee like Starbucks !

  • Cameron C
    Cameron C 4 months ago +1

    Costa Fans?

  • パンの耳ライオン

    Their coffee tastes like poo.. I'm good.. I'll go somewhere else.. ANYWHERE ELSE! Dennys has better coffee than this place

  • Jekku
    Jekku 4 months ago

    I'm SO SICK TO DEATH of Starf*x! BRING BACK THE MOM & POP COFFEE SHOPS!!! And STOP SAYING EXPRESSO, YOU IDIOT! If you're going to talk about coffee, you need to say the word ESPRESSO correctly! Ugh. ESS-presso.

  • adamshiftyelso
    adamshiftyelso 4 months ago

    Starbucks were basically everywhere in London leading up to the 2010 until nearly every store I can think of started closing down. I sure at least 50% of its stores it once had to be closed.
    Meanwhile in that same period Costa Coffee had been expanding aggressively both at home in the UK and abroad. The ‘08 crash and over-saturation I doubt had much to do with it, otherwise Costa would have suffered the same fate.

  • Doug Iden
    Doug Iden 4 months ago +4

    Mr. Schultz is the “Steve Jobs” of coffee. :-D

  • Joel W
    Joel W 4 months ago

    By convincing millions of hipster d-bags and various other trend followers that their utterly vile coffee (and toxic blah blah-chinos) tastes good and isn't 1000% overpriced. But hey, you get a fancy cup so everyone can know you are a mindless sheep (this applies to Apple as well)

  • luan trieu
    luan trieu 4 months ago +1

    Pay pennies for coffee bean and the farmers and sell the drinks for dollars on the pennies

  • Bailey Henderson
    Bailey Henderson 5 months ago

    Papa murphy's is expanding soon Starbucks and the other of public Washington State companies are winning I don't care it you are upset it's a fact I won this year so papa murphy's expands with sears kmart JCP and the whole alternative movement will crash

  • Lady of the Woods
    Lady of the Woods 5 months ago

    I go everyday I really like my SB coffee

  • Tanbone
    Tanbone 5 months ago

    I think I’m addicted to Starbucks

  • oacy16
    oacy16 5 months ago

    Narrator said “ekspresso” ...

  • drei t
    drei t 5 months ago +1

    here in the philippines one mall can have 3 starbucks inside wtf

  • Merrielle Gatlin
    Merrielle Gatlin 5 months ago

    Nyc definitely has wayyy to many Starbucks

  • Merrielle Gatlin
    Merrielle Gatlin 5 months ago

    No matter where you go in the world at least you have the familiar taste of crappy coffee from starbucks

  • DJMinor5000
    DJMinor5000 5 months ago

    Starbucks is a member of the evil empire out to destroy the world, up there with Walmart, Apple, Disney, etc.