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Starbucks Coffee opens first store in Pike Place Market in April 1971.

HistoryLink.org Essay 2075 : Printer-Friendly Format

In April 1971, Starbucks Coffee opens for business in the Pike Place Market, selling high-quality coffee, dark-roasted in small batches, the European way. Starbucks does not sell or brew coffee by the cup, but sometimes offers brewed samples.

Writer Jerry Baldwin, English teacher Gordon Bowker, and history teacher Zev Siegl had been buying their coffee from as far away as Berkeley, California, and Vancouver, British Columbia, and they saw a business opportunity. Each contributed $1,350 and borrowed another $5,000 to open a store that sold coffee beans, which they ordered from Peet's Coffee and Tea in Berkeley. They wanted to use a nautical theme and looked for names in the nineteenth-century novel Moby Dick. In researching Puget Sound history they discovered a mining camp on Mt. Rainier called Starbo. This evolved to Starbucks, after the ship's mate in Moby Dick.

At first, Zev Siegl was the only paid employee. Bowker and Baldwin kept their day jobs. Sales exceeded expectations and late in 1972, a second store opened in the University District. Siegl sold his stake in 1980 when Starbucks had four stores.

Howard Schultz (b. 1953) entered the scene in 1981. He was a New York-based vice president for a Swedish housewares manufacturer. He was "bowled over by his first sip of the dark-roasted coffee and urged Baldwin to hire him" (Seattle Post-Intelligencer, 2000). In 1982, Schultz signed on as director of marketing and retail stores.

In 1987, Howard Schultz led a group that bought Starbucks from its founders. By mid-2004, Starbucks had more than 8,000 retail outlets worldwide and was opening new stores at the rate of about three every day.

The company planned to open about 1,500 new stores in 2005, including 425 to be located outside the United States. “I believe that we will double the size of this company at least within the next five years, perhaps within the next three,” Orin Smith, chief executive officer, told a group of Costa Rican coffee-farm owners and political officials in January 2004 (The Seattle Times). Schultz has set an eventual goal of 25,000 Starbucks outlets around the world, putting the company on a par with McDonald’s and its 30,000 locations.

Sources:
Howard Shultz, Pour Your Heart Into It: How Starbucks Built a Company One Cup at a Time, (New York: Hyperion, 1997), 28-35; David Wilma Interview with Patricia Howell, Director of Marketing for Starbucks Coffee International, January 15, 2000; "MetropoList 150: People Who Shaped Seattle," The Seattle Times, October 14, 2001(www.seattletimes.com); Jake Batsell, "Starbucks Turned a Shot into a Grande," Seattle Post-Intelligencer, November 4, 2001 (http://seattletimes.nwsource.com); Christine Frey, “Starbucks’ Profit Jumps 44%,” Seattle Post-Intelligencer, July 22, 2004, p. D-1; Jake Batsell, “A Bean Counter’s Dream,” The Seattle Times, March 28, 2004, p. E-1.
Note: This essay was updated in August 2004.


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