Why Starbucks Isn't Worth the Bucks

The topless mermaid on the door is a ruse, no fun times are inside

Writer’s Update:

Been a hot minute since you’ve heard from me. IRL has been a bit chaotic, and I’ve been spending my remaining time building @theopetralabs. Building our vision and working with this team has been the best time of my life, and we’re just getting started. Check out what we’re doing here.

Back to the Roasting

There’s a billion* Starbucks locations within the US alone. But most of you know them for their insanely priced drinks, which are really mostly milk and sugar.

But how did this topless mermaid (No, not @bowtiedmermaid) end up the face of coffee for white women with too much money to spend? And why does this coffee suck?

Well, economies of scale for coffee are a bitch, and taking advantage of the history of coffee created the Starbucks empire.

*Source - This was once revealed to me in a glycine dream.

It’s Just History

Little bit of a history lesson. I have a plan to cover the full history of coffee in the stack, but I write out of order.

Starbucks started in Pike Place Market in Seattle, Washington in 1971. Initially not a coffee bar, but just a roastery. A place to buy beans to take home and brew yourself. A high class alternative to what could be found in the grocery store. Seattle residents were coffee lovers at the time, and the place became a hit.

That quality and tradition carried forward for another three decades.

A former employee wanted to turn Starbucks into a coffee shop franchise, and resorted to buying out Starbucks from the original founders 15 years after the opening to achieve this vision. From there, aggressive expansion across the US and the globe began in the 90’s.

Starbucks used to be the prime location for roasting technique, and the standard for barista’s to train on.

The black apron process was rigorous test, and was a symbol of pride in the industry. It still has cupping, the whole experience, but in practice Starbucks doesn’t follow what the roaster training teaches.

In the mid 2000’s this change was most noticeable. The Starbucks model became corporatized, and dedicated to expansion. Quality was sacrificed for pure scale and volume.

Many of the former black aprons left to open their own roasteries and coffee shops, emphasizing quality and dedication to the craft over volume. I’ve spoken with many over the years.

I’ll leave this section with the start of a ‘tism trail for you to follow if you are a culture and human relationships nerd.

Black Water and Blackwater

Starbucks has a scaling problem. Starbucks currently sources it’s beans from all over the world, with little care for how they are blended. The quality suffers and it’s all very soulless. I have a solution to return Starbucks to it’s roots.

To compete with gas station coffee, you can’t afford to scale small plantations to keep up with nearly 400,000,000 lbs of beans a year. You couldn’t physically source all these beans from the same plantation. One coffee plant produces a pound of green beans per year, and each plant needs about 6 ft between plants in a single row. So we need 400,000,000 plants minimum, not accounting for storm damage, rot, mishaps, or general cost of doing business.

Assuming 6 ft across per row, that’s 36sqft per tree, times 400,000,000 leaves us with 14,400,000,000 sq ft, or 516.5289 square miles, half the size of the state of Rhode Island. Just to grow coffee. The remainder of the state would be dedicated to processing, roasting, and logistics.

To make this even worse, the best coffee comes from high elevations, between 4000 to 5000 ft above sea level, as the growing season is sufficiently slowed to produce complex sugars which lend to more intense coffee flavors, further reducing available soil.

Good news, there’s potentially a country that can support this endeavor. Ethiopia.

Ethiopia however is a sovereign nation, and would not support a corporate takeover. Given the GDP of Ethiopia is over one hundred billion USD, it’s unlikely Starbucks could afford a buyout even before considering the fair market revenue multiplier.

We have to try another angle. The Ethiopian Army is between 250,000-300,000, so not particularly large. Blackwater and other private mercenary armies are available for hire around the globe.

The US Military paid top level Blackwater contractors $200,000 a year in 2008. That’s a fair sum, but in line for the work.

However we need to finance this operation. Considering no bank would finance such an endeavor, we need to look at alternative sources of financing.

In fact, Starbucks has creditors willing and ready to assist, it’s own customers.

Starbucks has over $1.6 billion located in customer accounts within their app. This is our budget, which gives us 8,000 soldiers we can hire for a 6 month operation, assuming the other half of the budget went to logistics and operating expenses. 8000 divided by 300,000 leaves us with a 37.5:1 disadvantage on paper.

Given the reputation of these organizations, and from a former Ranger “A squad of Rangers could reasonably just occupy the Seattle Police Department and they would just run the show”, it’s safe to say the force multiplier of a special forces member is greater than 37 poorly trained men.

At this point, Starbucks can proudly display 100% Ethiopian Coffee on it’s bags and in it’s stores, instead of the 100% Arabica it does now. With sourcing secured in house, it’s time to adjust our quality control.

Small batch coffee is called small batch for a reason. The larger you go in scale, the harder quality control is. Roasting Drums have residual heat from prior batches, so each batch needs a unique roast curve if you want consistent results. Mere seconds can alter flavor profiles. And as we know, good coffee is consistent coffee. In the industrial sized drums Starbucks, that’s a lot of knowledge.

Starbucks currently has five industrial roasteries, four in the US, one in Europe. This means we need relatively few roasters for the size of our production, as the head roasters can monitor production while training the less experienced employees up. Five per shift, three shifts, means 75 experienced roasters minimum. Hired from third wave coffee shops in the northwest, some of whom already hold the black apron prestige, Starbucks can become a symbol of high quality, ethically sourced Ethiopian coffee.

Economies of Scale

Seriously, Starbucks has a few serious problems, all in their supply chain.

The darker the roast, the more consistent the flavor profile across roasters and batches. And combined with the myth that light roasts have more caffeine (what weird copium), dark roasts sold better. This became a golden opportunity for Starbucks as less attention to detail is needed a dark roast. Dark roasts are easier to consistently produce.

Since it’s impossible to source single origin coffee on a scale to have at each Starbucks location, blends are used. With the dark roast so burnt you can’t pick out flavors, as long as the beans are all Arabica, source doesn’t matter for marketing. A consistently bad experience is still a consistent experience. And a consistent experience can make lots of money.

Since the beginning, Starbucks used primarily darker, espresso roasts. Light roasts weren’t popular, as taste association is a powerful tool. Most coffee at the time was a darker espresso or drip coffee, including grocery store coffee. Humans like what is familiar, so capitalizing on psychology is just good business. A higher class experience with similar flavors but it tastes better in your mind? Printing money.

With expansion comes logistical challenges. Starbucks doesn’t care for roast date, with employees telling me stories of coffee showing up a month or two after expiration, however it’s so burnt you can’t tell the difference. Coffee thrown into warehouses, sitting for months before it reaches the grinder, and you’ve got a recipe for disaster if you know the potential coffee has.

Now Starbucks is taking advantage of destroyed palates by serving mostly milk and forms of sugar. Coffee is boring, sugar and cream sell better anyway with a higher price tag. It’s just good business.

You Made It This Far, Stay for a Cup

I hope you guys enjoyed whatever this was. In all seriousness Starbucks is a prime example of exactly how not to commit to quality coffee, and highlights the problems with scaling a large coffee empire. It’s something I’ve thought about as I had an idea to build a much smaller version of this in the future, but with a dedication to quality.

Up next, I’ll have a collab post with another anon you all know and love, we’ll be showing you how to go from “It’s just coffee” to “Wow I taste citrus and berry notes” when you brew a your morning coffee.