Starbucks (SBUX - Get Report) Howard Schultz will attend his final shareholders' meeting as CEO on Wednesday before he steps down next month. He has held the CEO position, his second time at Starbucks' helm, since 2008. Before that, he served as Starbucks CEO from 1987 to 2000. Under Schultz's leadership, Starbucks has grown to operate more than 25,000 stores globally with sales over $21 billion as of its last fiscal year.
Here's a look at some of the ways Schultz has transformed the world of business.
Starbucks was founded in 1971 by three friends from the University of San Francisco: English teacher Jerry Baldwin, history teacher Zev Siegl, and writer Gordon Bowker.
Schultz joined the company in 1982 after enjoying the store's coffee. He then traveled to Milan in 1983, where he "saw how people caught up on the news while they sat or stood and drank their little cups of espresso," Starbucks marketing veteran Stanley Hainsworth told Fast Company. The vision Schultz brought back to the United States was "to design a social environment where people not only came for great coffee, but also to connect to a certain culture."
Starbucks, like Hainsworth's former employer Nike (NKE - Get Report) , is one of the "best brands" because it "created something people didn't know they needed." Schultz is coming full circle as the company plans to open its first location in Milan late next year, something he said in a statement is "the culmination of a great dream of mine-34 years in the making."
Starbucks was one of the first in the restaurant industry to offer employees stock options, healthcare and more recently, help with college tuition.
In 1988, a year after Schultz became CEO, the company began offering full healthcare coverage to full- and part-time employees. Three years later, Starbucks, according to its website, unveiled the first-ever stock option program for a privately held U.S. company that included part-time employees. The first "partners" received $6 per share, or 9 cents per share when adjusted for stock splits.
In 1992, Starbucks went public at $17 per share; by 1995 Starbucks employees could buy discounted stock through payroll deductions.
Then in partnership with Arizona State University's online program, Starbucks in 2014 unveiled a tuition reimbursement program for college degrees.
And the benefits keep rolling out: beginning Oct. 1, Starbucks will offer paid leave of 6-18 weeks to birth mothers and 12 weeks leave to non-birth parents.
Starbucks has gotten so good at mobile ordering that it could be losing traffic as a result.
Starbucks revealed in its most recent quarter that mobile orders account for more than 7% of total transactions, up 21% year-over-year. This has led to "significant congestion," such that some customers "either entered the store or considered visiting a Starbucks store and then did not complete a transaction," soon-to-be CEO Kevin Johnson told analysts on a conference call.
While Johnson couldn't quantify the number of lost customers, he said it was the "most significant contributing factor" to sluggish U.S. same-store sales growth of 3%. Schultz didn't sound worried on the conference call, saying that too much demand "is an operational challenge we have solved before and...will solve again."
Nevertheless, the fact Starbucks is even having a problem such as this while McDonald's (MCD - Get Report) will only launch its first-ever mobile ordering app later this year (in some locations) is telling as to Schultz' forward-thinking.
Starbucks declined to make Mr. Schultz available for comment.
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