Howard Schultz: The Star Of Starbucks

<b>Scott Pelley</b> Meets The Man Behind The Coffee Empire

Who would have believed that Americans would line up by the millions to pay $4 for a cup of coffee? Who would have imagined we would go into a coffee shop and casually ask for a double tall, one pump, vanilla skim, caramel macchiato? What the heck is a macchiato anyway?

Well the guy who did believe is Howard Schultz, the star of Starbucks. Schultz is given to leaps of imagination — he had to be, as he started out as a poor kid in Brooklyn who sold his own blood just to get through college.

Today as head of a $29 billion multinational, Schultz is not without his critics; some mockingly call Starbucks "Fourbucks." But when 60 Minutes correspondent Scott Pelley met Schultz, he found a salesman and a showman, who is creating his own subculture and intends to take the whole world along.



At the Starbucks headquarters in Seattle, they don't drink coffee like you and me. Howard Schultz analyzes each slurp, as though he's letting you in on a secret.

"You taste that earthiness? Like a Bordeaux wine. That is pretty good," Schultz points out.

Here people called "coffee masters" talk about finding romance and passion in a cup like they were cream and sugar. Schultz has brewed up a coffee culture that's, sometimes, a little hard to swallow.

"One of our colleagues coined a phrase a long time ago and said, 'We're not in the business of filling bellies. We're in the business of filling souls,'" says Schultz.

"Oh now, come on," says Pelley. "No wait a minute. That's too … this is a company. This is a corporation. Come on."

"OK, it is a corporation," Schultz acknowledges.

"You're blowing smoke now," Pelley replies.

"No, I mean this is how we feel. You might say, 'OK, they're full of crap.' And you know, this is how we feel," says Schultz. "We're in the business of human connection and humanity, creating communities in a third place between home and work."

"I've got to tell you I've been kicking around your headquarters for the last couple of days and I'll admit if you'll let me use a different beverage metaphor … the people around here really seem to be drinking the Kool Aid, they really seem to be completely steeped, to use another beverage metaphor, in this philosophy bit," Pelley remarks.

"But it's not a cult, this is a corporation, it is a for-profit business. But our approach for 30-plus years has been unique and different, not better just different. Not better, just different," Schultz replies.

That approach created a market that didn't exist and a company that now doubles its sales every three years.

The company, Schultz says, currently has about 11,000 stores in 37 countries and they are opening an average of five stores per day.

"It's an unbelievable number to me to be honest with you," he says.

There really are Starbucks across the street from each other. They do that to cut down on the lines. Starbucks says it has 40 million customers a week and the company brews 227 million gallons of coffee a day.

The operation that feeds that monster is massive. At a roasting plant outside Seattle, green coffee beans are shipped in from 28 countries. This plant will go through up to two million pounds of beans in a week and there are four plants just like it. Starbucks has become so pervasive it, has spliced itself into the national DNA, being mentioned on programs such as Oprah, Jeopardy and even the Simpsons.

While Schultz acknowledges there is a bit of a Starbucks blowback, he doesn't think the company is crushing the life out of mom and pop coffee shops.

"We are so different and when people understand that, they welcome us," he says. "For example, first off, we created an industry that did not exist and in our wake, the momentum of Starbucks, so many local and regional companies and mom and pops have not only surfaced, but succeeded."

  • Daniel Schorn

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