The CEO Diary with Fexingo · 2026-07-08 · 11 min
This episode of The CEO Diary dives into Howard Schultz's singular bet that turned Starbucks from a coffee bean roaster into a global third-place empire. Lucas and Luna trace the 1984 Milan epiphany, the controversial decision to bring your own cup, and the $5 million bet on the Frappuccino. They examine how Schultz's insistence on health insurance for part-time workers - a policy that cost Starbucks $300 million a year by 2025 - created a retention moat competitors couldn't copy. The conversation also covers the 2008 return and the closure of 7,100 US stores for retraining, a move that cost $40 million in lost sales but saved the brand. Specific numbers include the 2,000 new stores per year growth rate Schultz targeted, the 87 percent gross margin on drinks, and the 4.7 percent same-store sales decline that triggered the 2008 shakeup. A concrete look at how one leader's philosophy built a $130 billion company.
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