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Starbucks Commodity Chain
- 2. Where did it all start? In 1971 the first Starbucks store opened in Seattle Washington
- 3. Where does the coffee come from? Starbucks buys green coffee beans straight from the growers and primarily from three main regions: Latin America Asia Africa The green beans are transported by ship to the roasting plants.
- 4. Issues surrounding coffee suppliers Working conditions for coffee plantation workers are sometimes overlooked in the process from bean to cup. Workers are normally paid very low wages and endure extreme working conditions. When buying form foreign countries there are sometimes the risk of receiving a contaminated batch of beans. For example Starbucks purchased beans from Columbia and they were contaminated with a fungus. Starbucks uses a system called C.A.F.E. to regulate this issue.
- 5. C.A.F.E. (Coffee and Farmer Equity) C.A.F.E. was collaborated with Conservation international and SCS global services. C.A.F.E. is a set of criteria that regulates high quality coffee beans and equal relationships with coffee suppliers. They reward suppliers of consistent high quality coffee beans.
- 7. Roasting Plants & Warehouses Warehouse & Roasting Plant locations Gaston, South Carolina York, Pennsylvania Starbuck’s largest distribution center. Kent, Washington Minden, Nevada San Francisco, California Oregon Main loose leaf tea distributer Amsterdam
- 8. Roasting Plants & Warehouses cont’d At every roasting plant the beans are taken through various processes including the roasting, and packaging They use automated boxing and store the beans on pallets. Now the beans are ready to be shipped from the warehouses all over the world.
- 9. Environmental Issues with Coffee Plants While the beans are going through the roasting process there is a liquid waste product that is produced. Plants disperse of the waste by dumping it in waterways such as rivers. Consequences of this are aquatic wildlife is being harmed along with aquatic plant life.
- 11. Transportation of beans to distribution centers Transportation of beans to the United States from foreign countries is done by ship. Transportation from roasting plants and warehouses is done on land by semi truck.
- 12. Environmental Issues with Transportation. Pollution is always a main concern when it comes to the environment. When the semis are used to deliver products for Starbucks stores there is a lot of diesel fuel being distributed into the air. Air pollution is one of the main causes of global warming and is a leading environmental issue.
- 13. Distribution Centers There are nine regional distribution centers that contain strictly coffee 5 in the United States 2 in Europe 2 in Asia There are 48 other distribution centers that contain a lot of the dairy, paper, and baked good products for Starbucks stores. 33 in the United States 7 in Asia 5 in Canada 3 in Europe
- 14. Issues for Distribution Centers Starbuck’s has tried to find ways to cut cost when it comes to distribution of the coffee beans to stores and the location of where the beans are stored. They used calculations to decrease the amount of unused space within each distribution center. Less cost = more profit!
- 16. Starbucks Stores Starbucks stores are located all over the world. Regions include: Africa Asia North America Oceania Europe South America There are 20,500 stores in 64 different countries and territories. There are 10,000 stores just in the United States.
- 17. Issues for Starbucks Stores Recycling is large issue for companies all over the world. Starbucks has started making cups that are onlymade out of recyclable material. Also they have added recycling bins outside of their store locations to make it more accessible for consumers to help save the environment. Starbucks uses a system called C.A.F.E. to control some of these issues.
- 18. Starbucks Products Even though Starbucks is known for its coffee it has expanded its offerings to baked goods, tea, coffee accessories, ice-cream. Starbucks not only accommodates adults but also offers kids drinks including hot chocolate and apple cider.
- 20. Consumers Data shows that Starbucks targets men and women ages 18-40. Also higher and more average income families are more drawn to Starbucks products.
- 21. Prices An average price for a standard cup of Starbucks coffee is $2.00. Starbucks offers a lot of signature drinks which can range from $3.00-$5.00. Average price for a standard tea is about $2.00. Starbucks has always been known for higher priced products since they offer high quality Arabica beans. Some years Starbucks has had issues with their coffee suppliers due to weather and economic issues which causes the price to increase even more for consumers.
- 25. WORKS CITED: Cooke, James A. "From Bean to Cup: How Starbucks Transformed Its Supply Chain." – Procurement – CSCMP's Supply Chain Quarterly. N.p., 2010. Web. 22 Apr. 2014. "Manufacturing and Distribution." Starbucks Coffee Company. Starbucks Corporation, n.d. Web. 22 Apr. 2014. Boyer, Ken. "Behind the Scenes at Starbucks Supply Chain Operations it’s Plan, Source, Make & Deliver." - Supply Chain 24/7. Supply Chain 247, 20 Sept. 2013. Web. 22 Apr. 2014. <http://www.supplychain247.com/article/behind_the_sc enes_at_starbucks_supply_chain_operations/green>. Providing third-party environmental and sustainability certification, auditing, testing, and standards development.." Starbucks C.A.F.E. Practices. SCS global services, n.d. Web. 22 Apr. 2014. <http://www.scsglobalservices.com/starbucks-cafe- practices>.
- 26. Picture Links: http://kenwhacksit.blogspot.com/2010/11/el-centro- beautiful.html http://blogs.kqed.org/bayareabites/2010/07/29/3rd- wave-coffee-roasting-in-the-bay-area/ http://www.sfgate.com/health/article/Caffeine- dependence-tied-to-physical-emotional-5288887.php http://starbuckscoffeemasterclasshms.blogspot.com/20 13/06/the-philosophy-of-roast.html http://www.businesswire.com/news/home/201302190072 12/en/SKECHERS-Distribution-Center-Certified-Largest- LEED-Gold#.U1a9hsY3dfM http://www.outsidethebeltway.com/starbucks-to- expand-alcohol-sales/ https://www.bespokeoffers.co.uk/consumer/offers/buy- a-10-starbucks-card-egift-for-5-from-bespoke-offers