Howard Schultz (1953, Brooklyn, New York, United States) is a businessman known for being the CEO of the Starbucks coffee chain. Not only has he stood out for his career as an entrepreneur, but he also made his forays into the world of politics..
From humble beginnings, Howard Schultz’s name is synonymous with business success. Although Schultz was not the founder of Starbucks, he was integrated into the marketing area until he ended up becoming its CEO.
Hard early years for Howard Schultz
Schultz came from a humble background, so in order to pay for his studies, he combined several jobs and even donated blood to obtain additional income.
After years of hard sacrifice, Schultz received a bachelor’s degree in speech communication from the University of Michigan in 1975. All this made him the first in his family not only to receive higher education, but the first to obtain a university degree.
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Later, he went on to enter the Xerox company, where he performed telephone sales and word processor presentation work. But his career path took him to Hammarplast, a Swedish home products company where Schultz had a meteoric rise, leading the company throughout the United States.
Arrival at Starbucks
While working for Hammarplast, Schultz traveled to Seattle in 1981. There he visited one of the stores run by the founders of Starbucks (Jerry Baldwin, Zev Siegl and Gordon Bowker).
Schultz was fascinated by the quality and professionalism of the company and offered them his services as director of marketing. All this would lead him in 1982 to join the ranks of Starbucks, being he the head of the company’s commercial policy.
It should be noted that at that time, Starbucks only sold coffee beans and had not yet opened any coffee shops.
While working as director of marketing for Starbucks, while passing through Milan, he became aware of the business model of the coffee shops in that city. They were strategically placed in places like plazas, making coffee shops great meeting points.
Schultz proposed this business model for Starbucks establishments, offering hot express and quality beverages. But Schultz ran into the refusal of the founders of Starbucks, who were not in favor of landing en masse in the coffee shop business.
Faced with such disagreement, Schultz made a decision and in 1985 left Starbucks.
A season away from Starbucks
Despite the rejection of his proposals by the creators of Starbucks, Schultz decided to put his ideas into practice and founded a company known as Il Giornale (the newspaper).
The idea was to open establishments in the United States based on the model of coffee shops that he had seen in Milan. In other words, Schultz proposed strategically located cafeterias that would become meeting areas, where customers could enjoy a good coffee.
But, launching such a business project required vast financial resources. Despite the difficulties, Schultz managed to raise the necessary funds to pay for his entrepreneurial project.
Il Giornale establishments were attractive to the public, as they offered quiet and pleasant areas where they could enjoy a good hot drink. The atmosphere and furnishings made Il Giornale cafeterias truly comfortable places. As a result, Schultz’s project was a complete success.
Returned by Howard Schultz to Starbucks and business success
With Il Giornale’s business going from strength to strength, Schultz returned to Starbucks after buying the company in 1987 for $3.8 million.
Having Schultz at the helm of Starbucks involved a revolution in the company. Schultz’s business idea succeeded, making Starbucks a pleasant space where you can talk and enjoy quality coffee.
The success of the coffee chain led to the opening of new establishments and in 1992 the Starbucks company reached the prestigious NASDAQ stock index.
The progression of the business was such that it transcended beyond the US borders. Thus, when 2000 arrived, Starbucks had more than 3,500 establishments throughout the world and entered about 2,200 million dollars a year.
Schultz stepped down as CEO in 2000, moving to a more low-key position at the company. But the subprime crisis of 2008, and competition from the likes of Dunkin Coffee and McDonald’s, posed challenges that Schultz wanted to address personally.
2008 was a difficult time for Starbucks as many stores closed and staff were retrained to provide quality coffee to the public.
In fact, it should be noted that an important part of the successful management model of Starbucks is the good treatment of the employee, providing health insurance and offering shares in the company.
The changes introduced by Schultz paid off and the company dramatically increased its profits, from $315 million in 2008 to $945 million in 2010.
The company continued on an upward trajectory, reaching more than 28,000 stores worldwide in 2018, just the year that Schultz left all his positions at Starbucks.
The reason for his withdrawal from Starbucks was his desire to run for President of the United States in the 2020 election. However, in September 2019, Schultz proclaimed the end of his presidential ambitions.