Starbucks Coffee: The Journey from the Seed to your Cup
As I drank my mocha from Starbucks today morning, I was elated that the great buzz I was getting from it was considered legal. I started thinking about the sequence of events that led to the perfecting of the beverage in my hands. It takes a nanosecond to say the words “seed to cup” but hardly do coffee lovers ever think about the whole journey of their delicious pick-me-up drink from pure coffee beans to the nicely brewed drink? The world takes over 2 billion cups of coffee a year, and out of this, the USA drinks 18 gallons yearly (Figart, 2017). The average American consumes a cup of coffee every day, but this is nothing compared to Finland natives who supposedly drink three cups per day. Coffee is reported to be the second most traded commodity after oil. This paper will discuss the journey of Starbucks’ coffee from production to purchase, their supply chain process, procurement, inventory management, warehousing, and logistics involved in making their great beverage.
In recent years, Starbucks faced overwhelming challenges and a staggering growth rate. They decided to upgrade their supply chain, which is at the moment considered to be one of the best. Indeed, Starbucks finally managed to put the “Star “in Starbucks coffee. The company uses a vertically integrated supply chain, meaning they are involved in every step of the chain from the coffee beans to the beverage sold to its customers (Grabs & Ponte, 2019). They work directly to over 300, 000 coffee growers hence ensuring that the coffee beans achieve uniform quality and flavor. The quality and taste should match their Coffee and Farmer Equity (C.A.F.E) standards and Coffee Sourcing Guidelines (CSG). The journey of the coffee seed to the cup is a complex chain, almost 15 steps to make sure the consumer gets his/her favorite drink every day.
The first step is growing the coffee seeds in a nursery where they are planted and cared for under certain conditions; coffee is usually planted in the rainy season. The seeds take 4 to 6 weeks to germinate and sprout, and the young plant from that will stay in a nursery for almost eight months. When the seedlings grow to 18 to 24 inches, they are removed from the nursery and planted in the field because they are now tough enough to withstand the sun’s rays. Once Starbuck’s coffee growers plant the young plant, it will take it close to 3 to 5 years to produce some quality cherries. Ripe coffee berries have a bright, deep red skin that shields a fleshy pulp and two small coffee beans in the center. The seeds are now ready for harvesting. Coffee is picked and harvested in stages in a process is known as selective strip harvesting. This is where farmers pick the first harvest, then come back after 8 to 10 days to pick the next one until the whole field is covered (Egger & Orr, 2016). Small-scale farmers usually hand-pick their coffee, but with Starbucks, their growers have machines which help in harvesting the cherries.
Next, the growers select and sort the berries either through immersing them in water or using a processor so that only the best beans proceed to the next step. The farmers then remove the skin of the berries and the pulpy mucilage surrounding the seed in a process known as pulping. Then the coffee beans are fermented either through dry, semi, or wet processing which helps in achieving the depth and complex nature of the final product (Hoffmann, 2018). The farmers then dry the beans and store them sacks and on pallets under specific temperature and humidity for months or even years. The seeds are then milled which involves hulling and polishing to remove the parchment covering. Afterward, a professional taster or cupper is invited to smell and taste the coffee for grading purposes using the primary and secondary defects of the berries.
After the coffee farmers package the coffee, Starbucks truckers come in to distribute the unroasted coffee to the six storage sites in the USA and Europe. The berries are roasted here and then packaged for shipment to the central and over forty Starbucks regional distribution centers. Packaging protects the beans from air and moisture; hence, they stay fresh for weeks. The company closely monitors the roasting process to ensure that their coffee tastes the same in all its retailer locations. Their active participation in the supply chain also makes sure the products get to the distribution centers so that they can meet their orders on time. The coffee is then ground and brewed, after which coffee lovers can now get their favorite mug of Starbucks coffee.
In late 2008, Peter D. Gibbons, executive vice president of global supply chain operations at Starbucks, saw the staggering growth at the company and decided to do some reorganization. Hence, they simplified their complex structure, ensuring that each job fell under the four supply chain parameters of plan, source, make, and deliver. Those involved in production planning and replenishment of the coffee are under the planning group. In terms of procurement, Starbucks has divided its sourcing activities into coffee and non-coffee procurement areas. They spend the US $600 million yearly on coffee while other purchases cost $2.5 billion annually. All manufacturers, whether in-house or outsourced, were put under the “make” unit. The delivery group involves all those personnel in the transportation, distribution, and customer service sectors.
The company also uses binary metrics system to evaluate its supply chain activities on four parameters. They include safe operations, service that is determined by on-time delivery and orders, total costs of the supply chain, and savings. The scorecard system helps them in managing their inventory as they try to save costs in the procurement, marketing, and research and development ventures. The binary scorecard system helps Starbucks monitor the third-party logistics companies (3PLs) using numbers 1 and 2. As part of this inventory management initiative, they started making service data by store, delivery lanes, and a stock-keeping unit (SKU) which they availed to their partners. It ensures transparency as it showed their different improvements in costs while maintaining their customers.
For the coffee to get to every consumer’s hand around the globe, Starbucks uses a central logistics system that helps them manage, monitor, and coordinate its global network. Starbucks ships coffee from Africa, Asia, and Latin America to the US and Europe in ocean containers. From whichever entry port, the unroasted green coffee is transported in trucks to the six roasting facilities nearby. Afterward, the roasted coffee is trucked to their regional distribution centers (DCs). They have five such centers; Starbucks own two of them while third-party logistics firms run the rest. Besides coffee, Starbucks stores other products in these warehouses from furniture to cappuccino. Stores get their coffee supplies from Starbucks depending on their location through either the regional DCs or by the warehouses called central distribution centers (CDCs). The CDCs are operated by the third-party logistics companies which distribute not only coffee but dairy products, paper items, and baked goods.
The next time one enjoys the mug of Starbucks coffee, one should be grateful because that coffee bean has passed through several stages. The journey from seed to cup is long and amazing, but every step adds value to your latte, cappuccino, or mocha. After knowing the steps from the production to purchase, I have come to appreciate the efforts of the great men and women behind the perfect beverage. Moreover, I have even boosted my coffee brewing and tasting skills, having known of the coffee variations. I am now a loyal member of the “Specialty Coffee Movement,” smitten by this beverage beyond words.
References
Egger, S., & Orr, R. A. (2016). The Home Barista: How to bring out the best in every coffee bean. The Experiment.
Figart, D. M. (2017). Greening the Economy: Certified Sustainable Coffee. In Stories of Progressive Institutional Change (pp. 113-130). Palgrave Macmillan, Cham.
Grabs, J., & Ponte, S. (2019). The evolution of power in the global coffee value chain and production network. Journal of Economic Geography.
Hoffmann, J. (2018). The World Atlas of Coffee: From beans to brewing-coffees explored, explained and enjoyed. Mitchell Beazley.