Forget New Jersey governor Chris Christie — we're waiting for Starbucks CEO Howard Schultz to officially declare he's running for president.
The man who changed the way the world drinks coffee now seems hellbent on changing the world, period. Last month Schultz held a town hall to encourage Americans and their political representatives to put aside partisan politics and try to work together to improve our communities. He's also been lobbying his fellow CEOs to boycott donating to political campaigns until Washington (in his view) gets its priorities straight.
Presumably dissatisfied at the rate of change that politicking sparked, he's now taking matters into his (and his brand's) hands.
On Monday, Starbucks announced that it's getting into the job creation business. It's partnering with the Opportunity Finance Network to set up the Create Jobs for USA project. And today comes news that Starbucks is testing a profit-sharing retail concept in Los Angeles and New York, as a way to give back to the communities it serves.
Long committed to corporate citizenship, Schultz is no doubt hoping that he can help Americans get through the recession and inspire other companies to step up.
So how, exactly, will Create Jobs for USA work? Starting November 1st, Starbucks US locations will be asking customers to donate $5 (or more, of course) with the guarantee that 100% of donations will go to OFN to administer and finance community businesses.
To get things rolling, Starbucks (#96 on Interbrand's new Best Global Brands ranking) is kickstarting the effort with a $5 million grant from the Starbucks Foundation.
In return for customer donations at the cash register, and to serve as a symbol of Americans uniting with other Americans to help create jobs, Starbucks has created the “Indivisible” red, white and blue wristband as a thank-you for every $5 donation.
"The division in America right now is that there is a crisis of confidence with regard to our economy," stated Schultz to ABC News. "There's no division between business leaders and workers. The division is between what's going on in Washington and the fact that Americans who need solutions are not getting it."
As Schultz elaborated in a blog post,
Our commitment to being good neighbors has never been more important as our country weathers this challenging time. The United States is experiencing a jobs crisis. We’re faced with 9.1% unemployment – which increases to 11.3% in the Hispanic community and nearly doubles in the African-American community, 16.7%. Many are starting to lose hope in the American dream.
At Starbucks we’re committed to doing our part to help accelerate job growth in the United States through our stores. We hire about 200 partners per day in the country, and we plan to hire about 70,000 partners in all by the end of 2011. And we’re planning to add 200 new stores and remodel more than 1,700 stores in the United States over our next fiscal year. These efforts may create approximately 2,000 full and part-time jobs across the country.
While our business contributes to the communities we serve, we recognize that in this time of crisis, we can and must do more – especially when the small business community, where Starbucks has its roots, is so challenged.
The Starbucks-OFN partnership will provide capital grants to Community Development Financial Institutions (CDFIs), which in turn will provide financing to underserved community businesses in loans, community center and housing project financing and microfinance.
CDFI community lenders will issue $30 in financing, on average, for each $5 donation and based on conservative forecasting models, OFN and independent economists project one new job created or retained for approximately every $21,000 in loans – or approximately $3,000 in donations.
Schultz said his customers inspired him to take action. "I began to see someone at one of our local stores in Seattle very often. I walked up to him and I said, 'I just noticed you're here every day. Thank you for coming to Starbucks,’" Schultz told ABC News. The middle-aged man pulled Schultz aside and within five minutes began crying. He said, 'I come here every day because I have nowhere else to go.'"
In addition to the Starbucks Stimulus, in a related bid to help hard-hit communities get back on their feet, the company will also share profits from two pilot store projects, in New York's Harlem and Los Angeles' Crenshaw districts, with each receiving at least $100,000 in the first year.
Schultz, who grew up in federally subsidized housing in Brooklyn, told Reuters, “We are going to have to understand that for there to be shared prosperity, there has to be shared success and shared sacrifice."
Los Angeles Urban League’s Blair Hamilton Taylor, Starbucks’ pilot partner in Crenshaw, said, "It's not going to be a million dollars a year, but if McDonald's decides to do this next week, and then Wendy's decides to do it, and Burger King decides — now all of the sudden you do have a million dollars. My hope is that is what this triggers."
Cecilia Carter, Starbucks' VP of global diversity and advocacy wrote in a blog post titled "Imagine the Possibilities,"
These stores are a new way to support our communities by engaging the very people that will benefit from the program’s success. The more involved the residents become in owning their “community stores” the more they will frequent the store and make it part of their social fabric. The connections this can create mean more than sharing profits. It also means restoring a sense of pride and the ability to once again, imagine the possibilities.
Still, don't expect Schultz to give up his day job any time soon. As he told Reuters, it's all a continuation of his outreach to America's political leaders, not a veiled run at office. “I would beg [Washington], I would get on my hands and knees and say put your feet in the shoes of Americans who are being left behind and wake up and understand you took an oath of office to represent the country, not personal ideology.”