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Company reflects on past five years of performance that saw a
doubling in market value and topline revenue growth from $14 billion
to $23 billion.
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Starbucks reiterates 12 percent or greater non-GAAP EPS growth
target and commitment to return $15 billion to shareholders through
the next three years.
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Company details three innovation growth drivers in Digital, China
and Starbucks Reserve.
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Starbucks announces new standard for global pay equity, and
achieves 100 percent pay equity both for gender and for people of all
races in the U.S.
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Starbucks reaffirms commitment to employing and empowering the very
best talent, with more than 50,000 Opportunity Youth and 15,000
veterans and military spouses hired to date in the U.S., and more than
10,000 partners (employees) participating in the Starbucks College
Achievement Plan with Arizona State University.
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Starbucks reveals new commitments to sustainability, including a
$10 million investment in the “NextGen Cup Challenge” in partnership
with the Closed Loop Foundation, and in a coffee traceability pilot
program to assure transparency and trust and to give coffee farmers
even greater financial empowerment.
SEATTLE--(BUSINESS WIRE)--
Starbucks Corporation (NASDAQ: SBUX) today hosted its 26th Annual
Meeting of Shareholders, with more than 3,500 shareholders, partners
(employees), invited guests and board members in attendance. Key
presenters at the meeting included Kevin Johnson, president and chief
executive officer of Starbucks; Roz Brewer, group president and chief
operating officer; Lucy Helm, executive vice president and chief partner
officer; and Belinda Wong, chief executive officer of Starbucks China.
Johnson began the meeting highlighting the trajectory of the business
over the past five years and the foundation that has been laid to
accelerate the company’s next wave of growth. In his remarks, he offered
tribute to the heritage of the founder-inspired company and highlighted
both the power of the iconic brand and the strategic vision set to fuel
the company’s future.
“No retailer is better positioned to meet the changing needs of today’s
consumer, as expectations of convenience and community redefine what it
takes to be a successful and relevant brand,” said Johnson. “The story
of our growth over the past five years is grounded in key innovation
investments we have been making for our future, and this continued focus
will ensure we build upon on our leadership position in this rapidly
changing retail environment.”
Johnson highlighted three unique and core assets of the company:
increasing digital engagement, growing relevancy in China and
celebrating the Starbucks Reserve brand as the company’s innovation lab
for the future.
Expanding Digital Relationships
Building on the innovations of the Starbucks® App, Johnson shared
details of a strategy aimed to grow digital relationships with the more
than 60 million current U.S. customers per month who are not yet members
of Starbucks Rewards.
In addition to opening the App’s Mobile-Order-and-Pay capabilities to
non-Starbucks Rewards members this month, Starbucks will unveil a series
of campaigns – inside and outside stores – designed to build
personalized digital relationships with customers that create new
revenue opportunities.
“When it comes to how a retailer focuses on the customer, we see too
many examples of businesses choosing between an experience that solely
focuses on convenience or one that simply highlights community,” said
Johnson. “But we don’t believe there needs to be this type of a
tradeoff, and our third place can and will continue to unite both
experiences.”
Starbucks China Looks to the Future
The number of stores in China has grown from 800 to 3,200 in the past
five years, with an average of one new store opening every 15 hours.
Customers and partners connect with Starbucks in unprecedented ways in
China, in Starbucks stores as well as through social impact in the
community.
“We are humbled by how customers have embraced our third place
experience, while the core of our success in China has been our
partners, who deliver the unique moments of connections with our
customers each day,” said Wong. “As a key growth engine for Starbucks,
we are excited to continue to scale and imagine what is possible for
Starbucks in China.”
Starbucks remains on track to open more than 5,000 stores in China by
2021 and will continue to drive market-leading and locally relevant
innovation in coffee, store design and digital engagement to meet the
lifestyle aspirations of its Chinese customers while contributing
positively to the communities it serves.
Premium Category Serves as a Halo to the Core Business
Since the 2014 opening of the Starbucks Reserve® Roastery in Seattle,
the company continues to invest in the expansion of its premium Reserve
brand, centered around its small-lot coffee, immersive retail
experiences and Italian artisan food by Princi.
This includes the opening of its first international Roastery in
Shanghai, launch of the first Princi location in the United States
inside its Seattle Reserve Roastery and the opening of dozens of
Starbucks Reserve bar locations around the world. Most recently, the
company opened its first Starbucks Reserve store location at its Seattle
headquarters and already the store is seeing significant customer
engagement across all dayparts.
The company also has plans to bring standalone Princi stores to Seattle,
Chicago, New York and Shanghai and will open Roasteries in Milan and New
York later this year, in addition to Tokyo and Chicago in 2019. Over
time, Starbucks premium store segmentation will include more Starbucks
Reserve Roasteries and up to 1,000 Reserve stores, and 20 percent of the
Starbucks store portfolio will become Starbucks Reserve bar locations.
These three formats provide opportunities for the company to innovate in
customer experience and product pipeline, which will then be infused in
the broader store portfolio.
“The Starbucks Reserve brand represents the pinnacle of coffee theater
and passion, serving as inspiration to the entire organization,” said
Johnson. “As these store innovations become refined, customers can
expect to see an evolution of our innovation through our broader store
portfolio, elevating the entire premium experience for Starbucks and the
coffee industry.”
Chief operating officer, Roz Brewer expanded on upcoming innovations and
described what customers can expect from a pipeline of food and
beverage, with coffee at its core, giving a nod to the favorable
customer response to the newly introduced Starbucks® Blonde Espresso
Roast, and a platform of cold beverages.
“There is so much work going into our store designs and locations, how
our partners show up for our customers and how we extend the in-store Starbucks
Experience to a meaningful digital engagement,” said Brewer. “With
our partners and coffee passion at the center of it all, the opportunity
to build a reimagined Starbucks Experience is real. And we have
the right strategy and people making it happen.”
Creating Global Social Impact
For Starbucks, the power of the brand is fueled by both an elevated
customer experience and relentless efforts to create meaningful impact
in the communities it serves. On the heels of its announcement
earlier this week to create a “greener cup” and a $10 million investment
in the “NextGen Cup Challenge” in partnership with the Closed Loop
Foundation, the Starbucks leadership team laid out additional bold
commitments to growing the company’s global social impact.
Starbucks Commits to 100 Percent Gender Pay Equity Globally and
Achieves 100 Percent Pay Equity in the U.S.
From the beginning, Starbucks has made it a priority to put partners
first. From recent investments including parental leave to a
comprehensive Family and Partner Sick Time Benefit, Starbucks has
listened to its partners and invested in ways that promote equality and
career development. Now, that investment includes both gender and race
pay equity.
Announced today,
Starbucks has committed to achieving and maintaining 100 percent gender
pay equity for partners in all company-operated markets globally,
setting a new bar for multinational companies. This is an effort
supported by equal rights champion Billie Jean King and her Leadership
Initiative (BJKLI) and leading national women’s organizations, the
National Partnership for Women & Families and the American Association
of University Women.
Further, Starbucks announced it has achieved 100 percent pay equity for
women and men, and for people of all races, performing similar work in
the United States.
“This milestone is the result of years of work and commitment, and we
believe it is important, as a company of our scale, to help bring more
attention to this critical issue,” said Helm. “Starbucks has
consistently outperformed our industry in terms of pay equity, but it is
incumbent upon us to do more.”
Starbucks has also formulated Pay Equity Principles that led to the
successful closure of the pay gap at Starbucks in the United States.
Recognizing the importance of this issue for women all around the world,
Starbucks is sharing these principles so other companies can follow
suit, and address known systemic barriers to global pay equity.
Building a Strong, Purpose-Driven Pipeline of Talent
One year after its commitment to hire 100,000 Opportunity Youth – the 1
in 8 Americans ages 16 - 24 who aren’t in school or working – Starbucks
announced today it has reached 50,000 hires and is on track to meet its
goal by 2020.
Statistics show that Opportunity Youth partners are, on average, staying
with the company longer, receiving promotions, and signing up for the
Starbucks College Achievement Program at rates equal to their fellow
partners. Once enrolled in Starbucks College Achievement Plan,
Opportunity Youth hires are one-and-a-half times more likely to stay
with the company and are promoted at two times the rate of the rest of
the U.S. barista population. The value this population brings to
Starbucks is proving to be a model for others to follow.
To further reach and elevate the opportunity for these young people,
beginning this summer Starbucks will join forces with LinkedIn, MENTOR:
The National Mentoring Partnership and organizations like Big Brothers
Big Sisters, YMCA of the U.S.A., City Year, and YearUp, to launch a
nationwide pilot connecting more than 10,000 mentors and mentees across
the United States. Starbucks is also combining forces with the Schultz
Family Foundation, MENTOR and other values-aligned organizations to
bring mentor training to scale to support even more young people as they
launch their careers.
In addition to the work with Opportunity Youth, Starbucks remains
committed to creating opportunity for:
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Veterans and Military Spouses: With 15,000 hires to date,
Starbucks is on track to meet its goal of 25,000 hires by 2025. The
company will also unveil technology for the Starbucks® mobile app that
offers active duty service members, reservists, guardsmen, veterans
and military spouses additional Starbucks Rewards benefits.
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Partners in Pursuit of a Higher Education: The Starbucks
College Achievement Plan – a model for access to higher education for
employees in partnership with Arizona State University – now has more
than 10,000 participants and more than 1,200 graduates since its
launch in 2014. Through the Starbucks College Achievement Plan,
partners earn a bachelor’s degree with tuition costs covered, without
a further commitment to Starbucks. The program’s goal is 25,000
graduates by 2025.
Piloting Coffee Traceability Program to Further Empower Coffee Farmers
Starbucks prides itself on establishing personal relationships with
farmers who produce the highest-quality arabica coffee for our
customers. The company’s commitments to these farmers have extended to
key investments in:
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Open-source agronomy advances that help train farmers through nine
farmer support centers around the world
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$50 million in low interest loans to farmers
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Donating 100 million rust resistant coffee trees to those most
impacted by climate change
More than three years after announcing an industry milestone of 99
percent ethically sourced coffee, Starbucks announced
today the launch of a pilot program with select coffee farmers in
Costa Rica, Colombia and Rwanda, to develop and utilize an integrated
data platform that will create real-time transparency between coffee
farmers and customers in Starbucks stores.
The pilot allows Starbucks to explore the viability of scaling this
traceability technology to its more than 380,000 farmers.
“Achieving sustainability means we have to assure trust and transparency
from bean to cup,” said Johnson. “Starbucks is one of only a few coffee
companies that can trace our coffee to specific farms, helping to ensure
a viable livelihood for the farmers. And we are unique in that we want
to leverage an open-source approach to share what we learn with the rest
of the world.”
Starbucks Annual Meeting of Shareholders began at 10 a.m. PT today and
will be webcast and can be accessed at http://investor.starbucks.com.
A replay of the webcast will be available on the company’s website until
Friday, Sept. 21, 2018. Please visit http://news.starbucks.com
to find images, b-roll and live updates of the Annual Meeting of
Shareholders.
Forward Looking Statements
Certain statements contained herein are “forward-looking statements”
within the meaning of the applicable securities laws and regulations.
Generally, these statements can be identified by the use of words such
as “anticipate,” “expect,” “believe,” “could,” “estimate,” “feel,”
“forecast,” “intend,” “may,” “plan,” “potential,” “project,” “should,”
“will,” “would,” and similar expressions intended to identify
forward-looking statements, although not all forward-looking statements
contain these identifying words. These statements are based upon
information available to Starbucks as of the date hereof, and Starbucks
actual results or performance could different materially from those
stated or implied due to risks and uncertainties associated with its
business.
These risks and uncertainties include, but are not limited to,
fluctuations in U.S. and international economies and currencies, our
ability to preserve, grow and leverage our brands, potential negative
effects of incidents involving food or beverage-borne illnesses,
tampering, adulteration, contamination or mislabeling, potential
negative effects of material breaches of our information technology
systems to the extent we experience a material breach, material failures
of our information technology systems, costs associated with, and the
successful execution of, the company’s initiatives and plans, including
the recently completed purchase of the remaining 50% ownership of our
East China joint venture and our continuing growth in China, the
acceptance of the company’s products by our customers, our ability to
obtain financing on acceptable terms, the impact of competition, coffee,
dairy and other raw materials prices and availability, the effect of
legal proceedings, the effects of the U.S. Tax Cuts and Jobs Act and
related guidance and regulations that may be promulgated, and other
risks detailed in the company filings with the Securities and Exchange
Commission, including the “Risk Factors” section of the Starbucks Annual
Report on Form 10-K for the fiscal year ended October 1, 2017. The
company assumes no obligation to update any of these forward-looking
statements.
About Starbucks
Since 1971, Starbucks Coffee Company has been committed to ethically
sourcing and roasting high-quality arabica coffee. Today,
with more than 28,000 stores around the globe, Starbucks is the premier
roaster and retailer of specialty coffee in the world. Through our
unwavering commitment to excellence and our guiding principles, we bring
the unique Starbucks Experience to life for every customer
through every cup. To share in the experience, please visit our stores
or online at news.starbucks.com and Starbucks.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20180321005920/en/
Source: Starbucks Corporation