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  • 07.31.17

Starbucks Is Bringing Hope–And Profit–To The Communities America’s Forgotten

From Ferguson, Missouri, to military towns, the coffee giant is rejuvenating key areas of American society—and redefining what a brand can be.

There’s laughter behind the counter. The young people in green aprons, most of whom live within 5 miles of the store and possess a hard knowledge of the streets outside, razz each other and joke easily with regulars. Twenty-one-year-old barista Deidric Cook, who was living out of his Ford Focus before being hired last year, brings the homeless woman who routinely parks her shopping cart outside a tea for when she wakes up at her table. Around lunchtime, about a dozen men and women will gather in the café’s designated community room for a free job-skills training class led by local members of the Urban League. A large photo of a yard sign with the message I LOVE ALL OF FERGUSON hangs on the wall.

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Three years ago, Michael Brown was shot dead by a policeman on a nearby block, the event kicking off waves of protest and rioting that made headlines for months. As seen through the media’s lens, this was a city of torched police cars and smashed storefronts, hollowed out with sorrow and rage. So there’s something both bizarre and comforting about walking into Ferguson’s year-old Starbucks and experiencing the chain’s familiar, coffee-scented calm—not to mention watching Michael Brown’s charismatic uncle, who works here as a barista, prepare lattes behind the counter.

This café in Missouri represents one of 15 that Starbucks has committed to opening in underserved communities nationwide by the end of 2018 as part of its larger social-impact agenda, which over the past three years has grown increasingly aggressive, targeted, and sometimes controversial. In 2013, the company pledged to hire 10,000 veterans and military family spouses within five years and, having met the goal a year and a half early, upped its “hiring and honoring” commitment to 25,000 by 2025. In 2015, the Seattle giant launched another hiring initiative, this one to bring on board 10,000 “opportunity youth” (men and women between the ages of 16 and 24 who are not in school or working). The company has since hired 40,000, and this past spring pledged to reach 100,000 by 2020. In January, as an immediate rebuke to the restrictive travel and refugee-acceptance policies President Trump announced upon taking office, Starbucks launched yet another hiring effort: to partner with trusted agencies around the world and by 2022 hire 10,000 refugees in its stores across the world.

Barista Deidric Cook [Photo: Whitten Sabbatini]
Global responsibility chief John Kelly says that senior leadership routinely asks itself “Why not us?” before taking on the years-long operational demands of any of these various initiatives. “Like a lot of companies, we can have an impact: We could write a check, we could do some volunteering. But that’s not enough.” There is certainly a long game at play here—the Community Stores program represents a strategic opportunity, for example, for Starbucks to diversify its store portfolio as it pursues its goal of expanding into new markets with 3,400 new U.S. stores by late 2021. Yet Starbucks’s new CEO, Kevin Johnson, whom founder Howard Schultz handpicked as his successor, insists that the motivating factor is his 330,000 employees around the world; if they feel they are a part of something bigger than themselves, then that alone is good for business. “This is the core for our reason for being—to leverage our scale for good,” says Johnson. “It is possible for a publicly traded company to drive an agenda that is not only about shareholder value but is about social impact that helps the people and communities we serve.”


Related: The Inside Story of Starbucks’s Race Together Campaign, No Foam


The idea for the Ferguson store was born in the back seat of a car. A year after Brown’s murder, Schultz had been in St. Louis holding a forum on race with nearby St. Louis employees—one of many such gatherings he led as part of the company’s well-intentioned, if social-media-lampooned, #racetogether campaign, in which partners (as Starbucks refers to its employees) were encouraged to attempt casual dialogue with customers about America’s most sensitive subject. He made time in his schedule to take a drive through Ferguson, which is 70% black. Nearly half of all young black men in the St. Louis region are unemployed. Rodney Hines, now Starbucks’s director of U.S. social impact, accompanied Schultz and compares the ghostlike feel of the town to post-Katrina New Orleans. “Howard made a statement that resonated with me and others,” remembers Hines. ” ‘We’re absent from this community, and not only are we absent, but we have a responsibility and an opportunity to be here.’ ”

Rodney Hines and Ferguson Store Manager, Cordell Lewis speak during the Ferguson Store 1 Year Anniversary celebration on April 29, 2017. [Photo: Michael Thomas for Starbucks Coffee Company]
It was a risk for Starbucks to bring its brand to Ferguson. In terms of economic development, the city was a dead zone. Thirty-seven businesses in Ferguson had been damaged in the riots, 17 of them destroyed. But even beyond the obvious financial risk, Starbucks knew it would be easy to get it all wrong, to prolong the embarrassment of #racetogether by appearing to swoop into a famously hurting place with a touchy-feely mission statement and an expensive drinks menu. “Many people told us, ‘You do not have a role here,’ ” says Kelly. “Well, conversations about race are one thing, but this is all about creating opportunity.”

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Grief, food insecurity, and homelessness remain common struggles for the 23 employees at the Ferguson Starbucks. “When one of my partners, a young woman, comes to me and says, ‘I’m going to sleep in my vehicle for another night in the Walmart parking lot,’ ” says store manager Cordell Lewis, “how am I ever going to get on that person and say, ‘You’re late, you’re not in dress code’?” Lewis, a married father who used to manage a video-game store across the street before Starbucks recruited him—and who is currently taking free online computer engineering courses at Arizona State University through the company’s College Achievement Program—has tattooed arms and a Mohawk. He knows from his own childhood what it means to live for a while out of your car and relates to the chaos his employees must routinely work through. “If they were in a bad spot I would take care of it,” he says. “Starbucks would take care of it. If I had to do a cash payout I would come in and do that, and there wouldn’t be a problem with that.” Barista Deidric Cook, who credits his employee health insurance with allowing him to get the x-rays he needed following an injury from a car accident, says that “seeing your manager care about you that much makes it where you like coming to work.”

Cordell Lewis, the manager of the Ferguson Starbucks. [Photo: Whitten Sabbatini]
Lewis and his district manager, Nancy Siemer, offer employees a varied and ever-evolving range of assistance, from making sure they know which homeless shelter is on which bus line to Lewis once slipping a delivery guy extra cash to take a pizza to an especially rough neighborhood for an employee who hadn’t eaten in three days. “He’s like a dad around here,” says 20-year-old barista Adrienne Lemons, whose own father went to jail shortly before she was hired and whose paycheck must stretch to help care for her three younger sisters. “I’m not going to lie and say I haven’t come into work with [tears] on my shoulders, but this is our home away from home.”

Starbucks didn’t just go ahead with the store in Ferguson—it promised to build 14 additional stores in other low- to medium-income urban markets. (Six have opened to date in locations including Jamaica, Queens, and Long Beach, California.) In each spot, the company purposefully hires local minority- and women-owned contractors and vendors, works in tandem with local government and civic leaders, and partners with nonprofits to offer young people free, on-site job-skills training from the Starbucks customer-service curriculum.

Barista Adrienne Lemons considers the Ferguson Starbucks a “home away from home.” [Photo: Whitten Sabbatini]
“Starbucks in isolation in these communities isn’t enough,” says Hines, the lead on the initiative, explaining the effort’s longer-term goals. “Part of this work is to illustrate how feasible this is for us and for other businesses.” Since the Ferguson store launched in April 2016, 41 other new businesses have opened. “When one person steps out from the crowd, others will follow,” says local city council member Ella Jones. “Starbucks said, ‘We are going to Ferguson. We are going to help this community recover.’ Once Starbucks stepped out of the crowd, everybody began to follow.”


“Colonel, your drink is ready!”

The Joint Base San Antonio Starbucks sits at a busy intersection near three gated military outposts in Texas—Fort Sam Houston, Lackland Air Force Base, and Randolph Air Force Base. During the Friday morning rush, the room is thick with men and women in uniform. Twelve of the 26 employees at the two-year-old Sam Houston location are veterans, or spouses or teenage children of active service members. These stores—there are 32 so far in the U.S., marked by the subtle engraving of MILITARY FAMILY STORE on the front door frame—are a key part of the company’s hiring and honoring initiative, which aims to position Starbucks as a respite in military communities. The stores primarily employ veterans and military spouses and nurture relationships between the local base and veteran assistance organizations like Onward to Opportunity, which helps vets transition into new careers. Recently, Starbucks announced plans to open 100 additional Military Family Stores in the U.S. in the next five years.

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Ferguson patron Tyler Small [Photo: Whitten Sabbatini]
Shift supervisor Kelly Moore, 37, wears a green apron with an American flag sewn over the chest along with her first name and her designation of Army spouse. She has worked at Starbucks for two and a half years, though she says the chain has served as a comfort zone for far longer in the four countries and five states she’s bounced around thanks to her staff sergeant husband’s career. (The two are now separated.) “If you drive up and down this main road, it’s a lot of mom-and-pop stuff, dry cleaners,” she says. “Starbucks is the first thing most of these kids see when they leave the base that they’re actually familiar with. So this tends to be a meeting place for the younger troops who are here in training who don’t have any friends or family in the area. My son is getting ready to enlist. So I want to be that friendly, reliable face for these young people who have never left home before.”

Starbucks hasn’t always been known as a veteran-friendly, or veteran-ready, place to work. John Kelly, the company’s head of responsibility, remembers his first day in the Seattle offices in the fall of 2013, sitting in on a meeting between senior leadership and half a dozen lower-level members of the Starbucks Armed Forces Network, the in-house community of employees with military backgrounds that had been founded in 2007. “They were challenging the senior leadership of the company to take advantage of this extraordinary moment in time, of 2.5 million transitioning veterans, and do more proactively to seek out and help them,” Kelly recalls. The executives’ subsequent commitment to hire 10,000 veterans and military family spouses was followed closely by the publication of Schultz’s 2014 book, For Love of Country: What Our Veterans Can Teach Us About Citizenship, Heroism, and Sacrifice, and a $30 million pledge from the Schultz Family Foundation for job training along with research into post-traumatic stress syndrome and brain trauma. Starbucks bused hundreds of regional and district managers to Joint Base Lewis-McChord near Tacoma, Washington, to teach them about military culture.

Matt Kress, a former firefighter and EMT who spent 22 years in the Marine Corps, heads the Military Family Stores program. It was he who pushed for baristas to be allowed to add patriotic touches to their aprons, such as Moore’s flag, to bond with customers. He also lobbied for individual Military Family Stores to be able to differentiate themselves from the Starbucks norm. At the Lackland MFS in San Antonio, for instance, customers have decorated shelves with equipment they deployed with, such as a beaten-up pair of combat boots or oily body armor. The staff at the MFS outside Hill Air Force Base in Clearfield, Utah, has permission to continue to wear red T-shirts on Fridays until every one of its service members comes home from combat. “Starbucks has really succeeded at bringing in the culture of the military and making it a part of who we are as a company,” says Kress.

Baristas Deidric Cook and Adrienne Lemons [Photo: Whitten Sabbatini]
So the Armed Forces Network took it personally when, after Starbucks pledged to hire 10,000 refugees this past January, social media trolls began calling on people to boycott the chain. (“Hey @Starbucks, instead of  hiring 10,000 refugees, how about hiring 10,000 veterans instead,” read one tweet. “What does it say when a company is willing to give jobs to terrorists over homeless veterans and at-risk inner city youth? #BoycottStarbucks,” read another.) After getting the go-ahead from senior leadership, the Armed Forces Network crafted a graceful slap-down, both as tweeted replies that soon went viral and a statement on the Starbucks website, reminding critics about the company’s veteran-employment history as well as its largely ignored stated intent to focus first on hiring refugees with special immigrant visas—Iraqis and Afghanis who served alongside U.S. military. “I’ll speak for myself as a combat veteran,” says Kress. “One of the things we fight for is freedom, and that includes the freedom to live a life where you’re safe, and that includes refugees coming to this country.”

Moore says her husband was as proud of the company for standing publicly alongside refugees as he was the day it committed to hiring veterans. He had just eight days’ notice before he shipped out to Afghanistan not long ago, and Moore’s team rallied to cover her shifts so she could be with her family before he left. “Hey, we’ll work [with] a man down if we have to,” her manager told her. Moore had spent much of her adult life working minimum-wage fast-food jobs before landing at the coffee chain. Starbucks is the first employer that’s ever promoted her—”Twice!”—she tells me proudly. And regardless of her marital status going forward, if she moves again, her store manager will help place her at a Starbucks near wherever she ends up. Before working at the company, “because I transition so regularly, I just felt like, Well, I’m always going to be entry level, always have that beginner minimum-wage job,” says Moore. “Now, if I want to progress up the ladder, there is room for me to grow within the company.” Starbucks, meanwhile, holds on to its talent.


#BoycottStarbucks may have been a particularly obnoxious gambit, but it also spent a day as the No. 1 trending topic on Twitter. A YouGov BrandIndex survey found in March that consumers’ estimation of Starbucks had fallen by two-thirds since the company’s January refugee-hiring pledge. Starbucks hit back within the week, sharing a letter from market-research firm Kantar Millward Brown that disputed the YouGov report. “Stakeholders need the facts,” read the Starbucks release accompanying the letter. “We did not observe any substantive impact on Customer Consideration, Future Visitation Intent or Brand Perceptions or any other key performance metrics for the Starbucks brand.” At the annual shareholders meeting later that month, Schultz reiterated to the crowd that “we have never shown a harmful impact on our business due to our compassion.”

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Kelly explains that while the hiring initiatives don’t demonstrate a “direct correlation to revenue,” they are vital to the company. “Whether it’s the resilience of refugees, the energy of opportunity youth, or the service and leadership of our veterans and military spouses, these hiring initiatives are the best of Starbucks,” he says. “For all the critics out there who say we shouldn’t get involved with this or that, I think we have been able to prove that while we learn along the way and, yes, we make mistakes, at the end of the day we are a company that lives its values, and that has been key to helping us drive our business.” Now the goal is to encourage other major brands to follow; the company recently partnered with large corporations such as FedEx and JCPenney in hosting a daylong opportunity youth job and resource fair in Dallas in May, where 700 young people were offered jobs on the spot.

Ferguson demonstrates what a successful effort can look like. “The store is turning a profit in year one,” says Johnson. “We’ve specifically called out an intentional part of our strategy, which is to look at these Community Stores and make the investment in areas that others wouldn’t.” The café has seen sales growth of 15% since opening, ranks in the top 25% of food sales in the St. Louis area, and boasts a lower staff-attrition rate than the average Starbucks.

Starbucks district manager Nancy Siemer, who helped locals in Ferguson recover after the riots. [Photo: Whitten Sabbatini]
The benefits have spread three miles across town to Natalie’s Cakes and More bakery. Back in 2014, owner Natalie DuBose was a single mom of two young kids. On the night word spread that Ferguson cop Darren Wilson wouldn’t be indicted in Michael Brown’s killing, she got a call that her new shop had been damaged in the chaos. She rushed over and remembers little beyond a burning police car out front, plus, hanging upside down through her busted window, the Christmas tree she had set up as a holiday display.

A few days later, a stranger walked into her boarded-up shop as she was baking in the back. Before introducing herself, the woman took hold of DuBose’s shoulders and asked, “Are you okay?” They wordlessly fell into each other’s arms and sobbed. DuBose soon learned that this compassionate visitor was Starbucks district manager Nancy Siemer, whose husband had grown up in Ferguson just a few miles from where the rioting took place. She had seen DuBose crying on the local news, vowing to rebuild. Soon Siemer was stopping in regularly, each time bringing higher-level Starbucks executives with her to chat and try some of DuBose’s signature cake. In April 2015, after attending the groundbreaking ceremony for the Ferguson store, Starbucks senior VP of siren ideas Mesh Gelman formally asked DuBose if she was interested in selling her caramel cake at Starbucks. The trick, Gelman said, was scale. She had to commit to selling in multiple stores for the deal to make financial sense.

Ferguson bakery owner Natalie DuBose now sells her caramel cake at 32 Starbucks stores. [Photo: Whitten Sabbatini]
On the afternoon I visit her shop, DuBose is cleaning up pizza boxes. She has just finished lunch with the 10 local teens she’s hired for a 90-day summer program as part of her Sweet Success youth program. Today, DuBose’s caramel cake is available at 32 Starbucks locations in the greater St. Louis area as well as five local Schnucks grocery stores. She’s grown her staff from 4 to 22 employees. “It used to be I wanted a career that allowed me to take care of my kids,” she says, rubbing her hands over the goose bumps on her arms that she still gets when she marvels over her unlikely journey. “Now, all of a sudden, I can help somebody else take care of their kids.” When Rodney Hines visited Ferguson in April to celebrate the Starbucks location’s one-year anniversary, DuBose says she hugged him and asked to expand her reach into more Starbucks. She tells me she wants to grow another 10 times in the year ahead, in terms of employees, locations, community service, all of it. She is thriving, and she wants to help others do the same.

But there are lines she will not cross. This past spring, a Missouri chain of high-end coffee shops separately approached her, eager to sell her cake. DuBose never signed any type of exclusivity contract with Starbucks and realizes she would be giving up money the Seattle giant likely wouldn’t begrudge her. She walks over to the coffee pot by the cash register and picks up a half-full bag of Starbucks’s ground Pike Place. “Nah, I could never do that to Starbucks.”