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Supply Chain Management of Starbucks

Discuss Supply Chain Management of Starbucks within the Elements Of Logistics forums, part of the PUBLISH / UPLOAD PROJECT OR DOWNLOAD REFERENCE PROJECT category; Starbucks Corporation (NASDAQ: SBUX) is an international coffee and coffeehouse chain based in Seattle, Washington. Starbucks is the largest coffeehouse ...



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Supply Chain Management of Starbucks
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Netra Shetty
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Supply Chain Management of Starbucks - December 29th, 2010

Starbucks Corporation (NASDAQ: SBUX) is an international coffee and coffeehouse chain based in Seattle, Washington.

Starbucks is the largest coffeehouse company in the world,[2] with over 16,858 stores in 50 countries, including over 11,000 in the United States, over 1000 in Canada, and over 700 in the UK.[3][1]

Starbucks sells drip brewed coffee, espresso-based hot drinks, other hot and cold drinks, coffee beans, salads, hot and cold sandwiches and panini, pastries, snacks, and items such as mugs and tumblers.

# challenges increase because the $7.8 billion company with 13,000 stores in 40 countries is growing so fast, about 20 percent annually, opening up on average six new retail outlets daily. D'Addario said Starbucks security focuses on identifying risk and investing in risk mitigation measures that show return on investments; authenticating partners, trusted agents and goods providers; building a global view of operations that reports exceptions. The company also seeks continuous improvements in people, process and technology "in a culturally relevant way."

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# The security team has built what it calls "Enterprise Security Platform," a central security facility that "converges enterprise and physical security," by monitoring critical facilities, retail stores, as well as monitoring conditions around the globe.
# Container security is a key part of supply chain management. Starbucks uses video monitoring of loading facilities, to capture images of loading and sealing containers with "container security devices" a magnetic device that tracks the closing of the container doors, its opening, and temperature and humidity along its journey. The device also is capable of uploading data from third party logistics providers. And it detects tampering. (Starbucks rejected using RFID or GPS devices as not worth the cost, Dettloff said.)
# A cross-functional governance council sets company policies for the company. Starbucks has built an electronic policy library to help employees know what to do and how to do it.
# Security provides in-store training to employees to help them understand how to handle risky situations, from customers who turn violent to criminal activity. Design elements also provide for lighting and clear visibility into stores. Future enhancements call for furniture designed to help consumers protect their handbags and laptops

Through the Starbucks Entertainment division and Hear Music brand, the company also markets books, music, and film. Many of the company's products are seasonal or specific to the locality of the store. Starbucks-brand ice cream and coffee are also offered at grocery stores.

From Starbucks' founding in later forms in Seattle as a local coffee bean roaster and retailer, the company has expanded rapidly. In the 1990s, Starbucks was opening a new store every workday, a pace that continued into the 2000s. The first store outside the United States or Canada opened in the mid-'90s, and overseas stores now constitute almost one third of Starbucks' stores.[4] The company planned to open a net of 900 new stores outside of the United States in 2009,[5] but has announced 900 store closures in the United States since 2008.

Starbucks has been a target of protests on issues such as fair-trade policies, labor relations, environmental impact, political views, and anti-competitive practices.

Starbucks has established a comprehensive sustainable supply chain strategy through
cooperation with Conservation International and other partners. In fi scal 2004, Starbucks
introduced the Coff ee and Farmer Equity (C.A.F.E.) Practices criteria. While these criteria
primarily focus on issues of social and economic responsibility, they do include guidelines
for coff ee farmers to conserve water and energy use. In 2007, Starbucks introduced a new
scorecard for C.A.F.E. Practices and launched an online reporting system for verifi cation
organizations to submit reports. Starbucks works with Scientifi c Certifi cation Systems (SCS)
to oversee the verifi cation system.
Starbucks has also begun to engage its supply chain on climate change mitigation issues. In
2007, the company reached out to 387 of its largest suppliers in the US encouraging them to
purchase renewable energy certifi cates (RECs) through the company’s preferred rate contract.
While only 11 suppliers took advantage of the opportunity, it is an innovative model for large
purchasers of renewable energy to multiply the eff ects of their commitment along the supply
chain and grow overall demand for renewables.
In terms of packaging, in 2006, Starbucks introduced hot beverage paper cups containing 10
percent post-consumer fi ber in its US and Canada stores. Th ese cups reduce the wood needed
as a raw material as well as the energy used to produce them. In fi scal 2007, Starbucks also
began a lifecycle assessment of polylactid (PLA) plastic resin, an alternative material made
from corn that the company is considering using in cold beverage cups.

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