Howard Schultz on life after Starbucks 2018 interview

Let's go in. Come. I think most Italians are expecting a Starbucks traditional store. In fact, I think many people are confused. Why did Starbucks take this big, big building for a little coffee store? And when they walk in here, they are going to be in awe of the architecture, the design, and the craftsmanship. And every element, there's so many unique, intimate spaces in here that speak to our love of coffee, our love of the Italian culture. And I think what we've tried to do is demonstrate we're not coming here to teach the Italians anything about coffee. Look at this. Wow. So Italy not only is famous for coffee, but you know, very famous for gelato. Something's going to blow you away. You have to try. And it's nitrogen infused. It's going to take a few minutes, but you should do it. Why did you sit down? Will you have some with me? The most famous way in Italy to enjoy gelato is an affogato, which is gelato, and then it's drowned with a shot of espresso. How is that? Fabuloso. You know, what would be an Italian coffee bar without Apertivo? That's true. We have built and created our own unique, customized Apertivo bar. You can imagine what this place is going to turn into. What we've really tried to create and think about is, what can we do, given this long history of coffee in Italy, that would truly delight and exceed the expectations of the Italian people in the most respectful, humble way? And I hope that we have achieved that. After taking a tour of Starbucks' latest crown jewel, I sat down with Chairman Emeritus Howard Schultz for a broader conversation. Howard, we're here in the Milan Roastery. This is your dream, 35 years in the making. It's absolutely stunning. And this also falls on a very special anniversary for you when you started at Starbucks as an employee. So you're coming full circle. Tell us, what does this moment mean to you? It's so hard to describe in words. There's so much emotion. Yesterday, when we had the partner meeting and they started singing that song in Italian, I literally started crying. I mean, this is such a extraordinary moment for the company and for me. I've dreamed about opening in Italy for so many years. And to be able to open the roastery, and the response we've gotten over the last week from the Italians who have seen it, I think just speaks volumes to the fact that we've tried to be very humble, respectful of the Italian heritage. Now, you did mention during the partner meeting that you have been met with some cynicism. Starbucks is a really well-known American brand, and some might see you coming here to serve coffee in what some might refer to as the Mecca of coffee. There are espresso bars everywhere. So what sort of cynicism have you heard, and how do you respond to some of the naysayers out there? Well, I think there's been two schools of thought. You're right, some people have said, perhaps Starbucks should not come to Milan. There's 1,500 coffee bars alone in this city. On the other hand, people have encouraged us because the expression of what we do with coffee, there's five different methods of how the customer can get their coffee, the quality, integrity of this place. And I think we have something to offer that is not Italian, that is complimentary. Also, the space, this is almost 30,000 square feet. I think the Italians are expecting us to open up a coffee store. Most Italians have never seen coffee roasted, despite how much they love coffee. And so there's gonna be education, there's gonna be theater, there's gonna be romance. There's a level of sensuality in here that speaks to the Italian culture. And I think the Italians are gonna vote very positively and say, yes, I wanna be in this space. The excitement in Milan for this opening, I can honestly say, I've been to many Starbucks openings, there's never been anything quite like this in terms of the anticipation among the Milanese people. Well, there's no denying that Starbucks has really taught people how to drink coffee, but in recent years, others have entered the space. And more recently, I can think of Coca-Cola just doing a big deal to acquire Costa Coffee for 5.1 billion. So how do you think about competition going forward? Well, the Coke deal surprised me in the sense that I don't know how, they have no operating experience with retail, so it'd be interesting to see what they do. But they're in a business where not many people are continuing to drink soda water and Coke and they've gotta find growth, so I understand it. But let me say something. I've got great respect for Coke. I'm sure they have big strategic plans. We've always respected competition. I think it makes us better. Our leadership position is not an entitlement, we have to earn it. But this roastery, I think, demonstrates our commitment to innovation and the fact that we're not sitting still, that we're gonna do everything we can to continue to define the category. And we've never been followers, we've always had courage, and there's no better manifestation than all of that than what this is and what this represents. And I do wanna get your take on the economy. Now, when you returned to the helm as CEO in 2008, that also coincided with the global financial crisis. 10 years later, the economy is strong, the stock markets continue to reach new highs, but given that experience of returning to Starbucks during the crisis, what lessons did you learn and what red flags do you now see on the horizon? Well, one thing I wanna say is the economy is strong for many people, but there's millions of Americans that are not participating in the economic growth. So just some facts that we should establish. Over 40% of American households do not have $400 for a crisis. Almost six million young people in America, ages from 16 to 24, are not in school and not working. So the economy, if you use the stock market as a proxy, is wonderful, but millions of Americans are not participating and being left behind. So I think it's really important to demonstrate that there's much work to do to take care of and address the inequities that exist in the US. Whether or not the stock market continues to perform at this level, I don't know. Now, you stepped down as chairman back in June. Yeah. A lot of folks have questions. I know our audience has a bunch of questions for you. Now, at the time you wrote that you would be exploring a range of options from philanthropy to public service. Now, Howard, the summer is over. Yeah. What's your plan? Well, I've been writing. I did say that, and it's exactly what I've been doing. So I took my first family vacation in almost 40 years. I'm just finishing writing an important book about lessons learned and my thoughts about the country and some of the things I've talked about in terms of humanity. And I'm still thinking about and pursuing what I can do as a citizen to improve the lives of others, both in the US and around the world. I think it's important to say, I do not have to run for president to improve the lives of others. And so I'm looking at a range of options and we'll just see what happens. It's still very early in this process for me. It is early, but I have to ask you this without asking you if you're running. How does it feel when people do ask you if you're running and how does it feel when people tell you that you should run for office in 2020? Well, it's very humbling. I think when I think about that question and the environment we're in today, regardless of who ultimately is the president in 2020, I think it's critically important in view of the very fragile nature of the world we're living in and America's position in the world and America's role in the world and America's standing in the world that the right person, the right person is the next president of the United States. You just mentioned America's standing in the world. You've traveled all over the world in your role at Starbucks. How has America's standing changed and what do you think the perception is of America? I think we are in an environment right now where unfortunately many of our allies and many of our relationships are being questioned and we have to do everything we can to restore and reaffirm our position in the world. So it's a very important time in the world because of how fragile it is and certainly an important time for America to demonstrate the importance of American values not only here at home but also around the world. And I think the world is relying and always relies on those values. Speaking of some of those relationships, one that's in the news right now is the US and China, the trade tensions there. Trump is expected to announce more tariffs and Starbucks is an American brand operating, you're opening a store about every 15 hours in China. So how would something like that impact your ability to do business in mainland China? Thus far the tariffs that have existed and the trade war that's currently going on between the US and China has not really affected Starbucks. But what I would say about this is it's in the interest of both America and China to find common ground and there are many things that are in our mutual interest.