Just when you think that Starbucks chairman, Howard Schultz, might be the last person left at the corporation who understands anything about good coffee, he makes boneheaded comments that dispel any chance of that happening again: Starbucks chairman sees gourmet coffee shortages | Reuters.
Today in Mexico City, Mr. Schultz publicly predicted a global shortage of gourmet coffee beans as worldwide consumption of higher-quality bean stocks is on the rise. But in an act that can only be described as misplaced egotistical chest-beating, Mr. Schultz not only acted irresponsibly by spreading rumors and arguably trying to incite a supply panic, but he also made ridiculous claims about Starbucks’ place in the coffee supply chain.
“At the very top of the market where Starbucks plays, I do not believe that others will have access to the quality of coffee that we are buying because we have secured those sources,” Schultz said.
Yet, for example, no one has ever found anything close to a Cup of Excellence coffee offered at Starbucks. Furthermore, Starbucks’ size and scale — and brand promise of feigned consistency across tens of thousands of retail cafés worldwide — prevent the mega-chain from sourcing their beans from smaller, artisan growers capable of growing the highest quality coffee beans. Instead, Starbucks’ scale requires a lowest-common-denominator approach — where they only deal with growers who can supply coffee beans in large enough quantities to meet their broad distribution needs. Thus Starbucks essentially has the same fast food mega-chain supply problem that McDonald’s has with their potatoes.
Mr. Schultz wouldn’t be the first corporate officer who has lied to the public. But most corporate officers of multi-billion-dollar chains are at least savvy enough to choose lies with some degree of credibility. Lacking this most basic of executive judgment skills, somebody needs to cut off Mr. Schultz from drinking all the company Kool-Aid Frappuccino.
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