CEO of Starbucks Howard Schultz is stepping down and handing the reigns over to current Chief Operating Officer Kevin Johnson. Johnson has been with the company seven years before joining the executive board about two years ago.
Schultz has been with Starbucks for over twenty years and is accredited with bringing the company to new heights. After joining the company as marketing director in 1982, Schultz modified the way Americans drink coffee and opened a door for a social gathering place that gets people out of the house. Schultz later left the company to open Il Giornale, his own coffee shop. That didn’t last long, however, and he came back to buy the Starbucks brand, changing his store’s name to Starbucks and expanding the company to over 25,000 shops globally.
Investors aren’t in favor of Starbucks spending over $100 million on a new project if the economy goes south. Schultz will continue to create a new brand of high-end coffee. Schultz believes that this new high-end brand will be the largest change that Starbucks has received in 20 years.
The inspiration for this new project came from the Starbucks Reserve Roastery and Tasting Room in Seattle. This 15,000 square foot coffee shop uses a siphoning process that produces a 12-ounce cup of coffee for $12. Schultz plans to open at least 30 more large facilities like the Roastery and at least 1000 smaller shops similar to the Roastery. However, Starbucks plan to further expand over 25,000 of its stores to offer similar options that are available in shops like the Roastery.
Although Schultz is stepping down as CEO this April, he will remain on as chairman and says this new change “gives me the entrepreneurial freedom to do what I think I do best.”