Executive Times






2008 Book Reviews



Starbucked: A Double Tall Tale of Caffeine, Commerce, and Culture by Clark Taylor








Click on title or picture to buy from amazon.com






No matter how many times you’ve been to Starbucks and consumed its products, chances are you’ll find out something new on the pages of Clark Taylor’s book, Starbucked: A Double Tall Tale of Caffeine, Commerce, and Culture. I was surprised to learn how much milk and sugar the company delivers in its popular products. In hindsight I shouldn’t have been as surprised by this quote from former CEO Jim Donald, “Lines mean we need more stores.” (p. 261). Taylor assumes a skeptical point of view and makes claims about the company that offer a point of view that led me to raise my eyebrows from time to time. Whether you agree or disagree with Taylor’s point of view, his exploration about this company provides many ideas for reflection. Here’s an excerpt, from the end of Chapter 5, “Storm Brewing,” pp. 166-8:


Naomi Klein, creator of the antichain "No Logo" movement, has lambasted Starbucks over its habit of clustering stores and opening next to mom and pops, but in the coffeehouse business, a cluster of cafes can do better as a group than each cafe would alone. Just as a thicket of restaurants or gas stations will amplify business for every­one by forming a nexus people instinctively gravitate toward when they think food or gas, a Starbucks and an independent can work in tandem to draw more coffee drinkers. It's like a reverse Wal-Mart effect. Independents also benefit from Starbucks's mainstream ap­peal. Said Milletto, "They give people a safe place to have their first specialty-coffee experience, and once they have that, they find it eas­ier to venture out." Stories from around the country bear this out. For example, the Omaha World-Herald reported that after Starbucks blitzed Omaha with six stores in 2002, business at locally owned cafes was up as much as 25 percent, with many new mom and pops opening up. And Martin Diedrich, who had watched Starbucks open "within a stone's throw" of each of his coffee bars, likewise reported increased sales. "I didn't suffer whatsoever," he said, his near heart at­tack notwithstanding. "Ultimately I prospered, in no small part be­cause of it."

The coffee community isn't unanimous on the verdict that Starbucks boosts independents, however. Corby Kummer, the Joy of Coffee author, says that mom and pops are getting harder and harder to find when he travels around the country, a claim not supported by industry statistics. Many can't get beyond the fact that the company clearly in- tends to leach sales from locally owned coffeehouses. Several coffee shops have indeed gone under thanks to Starbucks, but most agree that these occasional casualties were generally subpar and deserved to be pruned away. "Starbucks has managed to establish a minimum stan­dard of service and quality," said Timothy Castle, a specialty-coffee consultant and writer. "They make it very difficult for people to survive in this business who are not doing a good job. You have to be better than them to survive, which is hard to do."

Some even go so far as to credit the company for making the whole business viable in the first place. Without the work Starbucks did to popularize espresso and to educate customers in the vagaries of coffee connoisseurship, who can say if the coffeehouse industry would have ever grown this prosperous? "Everyone I know in the business who's doing well — none of us would be where we are if it wasn't for Starbucks," said Joe Monaghan, the Seattle coffee industry veteran. "My roof and my kids' shoes and my daughter's college education — that's all thanks to Starbucks and Howard."

This is fundamentally the company's position on the matter. "It's kind of ridiculous to say Starbucks put people out of business," Howard Behar, the former right hand to Schultz, told me. "If anything, we cre­ated an industry. We legitimized something that was kind of bohe­mian." Schultz put this argument much more stridently to a Seattle Weekly reporter in 1994, when the issue of Starbucks targeting indepen­dents was first gaining momentum. "It's ironic to me," he said. "I came back [from Italy] with the drink caffe latte in 1982. That word was not in existence in this town before we opened up our first coffee bar in April of 1984 in downtown Seattle. We created this business. We cre­ated a tremendous opportunity not only for ourselves, but for others. We're not asking anything for it. It's great. . . . Why there's animosity toward us is a question you have to ask others." When I asked Schultz if he still held to these words, he reaffirmed them without hesitation. "We created an industry that did not exist," he said. "We created a bev­erage experience, both in terms of the makeup and the ingredients of a drink that only existed in Italy. We created a language that didn't exist. We changed the culture and enhanced people's lives through a simple cup of coffee, and we've done it around the world. Absolutely."

Whether or not you buy Schultz's claim, the truth is this: all parties involved — Starbucks included — are fortunate to have found them­selves selling such an incredibly lucrative product, for which the world's appetite only continues to increase. Few trades exist in which consum­ers allow retailers to charge a huge price for something that costs next to nothing to produce, and gourmet coffee is certainly one of them. It's hard to go wrong with it. "You can't do better than a cup of coffee for profit," said Dan Cox, a former SCAA president. "It's insanity. A cup of coffee costs sixteen cents. Once you add in labor and overhead, you're still charging a four hundred percent markup — not bad! Where else can you do that?"

The enormity of the coffee market makes it impossible for even a behemoth like Starbucks to monopolize the industry. Americans alone drink three hundred million cups of coffee every day, which makes the seven million customers Starbucks serves daily around the world seem almost tiny by comparison. And the size of the pie keeps growing. Min­tel, the market research firm, expects national specialty-coffee sales to more than double between 2006 and 2011, hitting a lofty $18.8 billion. The air is so thick with cash that things seem to work out for everybody.

Everybody, that is, but the people who grow the coffee.


The ubiquity of Starbucks has changed many communities. Taylor’s perspective is that many of these changes are for the worse. Read Starbucked and decide for yourself. Have an espresso or two while you’re at it.


Steve Hopkins, January 22, 2008



Buy Starbucked

@ amazon.com

Go To Hopkins & Company Homepage



Go to 2008 Book Shelf

Go to Executive Times Archives


Go to The Big Book Shelf: All Reviews





*    2008 Hopkins and Company, LLC


The recommendation rating for this book appeared

 in the February 2008 issue of Executive Times


URL for this review: http://www.hopkinsandcompany.com/Books/Starbucked.htm


For Reprint Permission, Contact:

Hopkins & Company, LLC • 723 North Kenilworth AvenueOak Park, IL 60302
Phone: 708-466-4650 • Fax: 708-386-8687

E-mail: books@hopkinsandcompany.com