If you had the chance to sit down with the Starbucks’ Director of Environmental Impact, what would you ask him? This thought was racing through my mind as I turned into the parking lot of Seattle’s world famous coffee company. The opportunity to meet with Starbuck’s Director Jim Hanna had come with a turn of luck. An SIS blog post titled “Investigating Recycling and Starbucks” had made its way into the coffee giant’s headquarters, and Jim had emailed me a response. Now, I was getting ready for a face-to-face interview to talk about the environment, paper cups, coffee, and Starbucks.
Like any other global company, Starbucks has fallen under scrutiny when it comes to its environmental impact. And like other global companies, they have pushed back with environmental initiatives and programs. Was Starbucks guilty of green-washing, or did the company truly care about the impact it had on our environment?
Environmentalism is essential to our core business, Jim explained while sipping a Tazo tea. At its heart, Starbucks is an agriculture business. Its success relies on a steady supply of coffee beans from around the world. The beans which Starbucks buy must meet certain quality and price considerations. Coffee farmers depend on highly specific climates and growing practices to meet those standards. Eco-harming pesticides can ruin the coffee flavor. And climate change could drastically alter the price we coffee lovers pay for a latte. For Starbucks, being green is akin to long-term survival.
Environmentalism is more than just coffee beans for Starbucks. “What about the eco-impact of disposable paper coffee cups?” I asked over my sandwich. After all, the 16 billion paper coffee cups used in the US every year add up to a lot of landfill garbage and consumed natural resources. Jim pointed out that Starbucks was the first company to offer paper coffee cups partially made from recycled content. The cups, 10% of which is post-consumer recycled fiber (PCF), is estimated to save tens of thousands of trees, a half million gallons of wastewater, and several million pounds of garbage from being trucked to landfills.
“Why only a 10% PCF cup?” I ventured. “Wouldn’t a 100% cup be 10 times better?” Jim explained that the technology to make a higher PCF content cup just isn’t viable today. The main problem stems from differences in the fibers of recycled paper. Recycled paper fibers are shorter than those in non-recycled paper. This means that a coffee cup made using recycled fibers requires more paper pulp. And as more recycled content is added – more paper is used – economists call this the law of diminishing returns. We may one day see a cup made completely of recycled paper - but the technology needs to catch up first.
The sugar coating is that the new cup technology is not patent protected. Coffee chains, local coffee stands, and even college campuses can now purchase disposable cups made of 10% recycled paper. Jim hopes that more companies will begin using the 10% PFC cup – leading to a domino effect of environmental benefits.
Of course, the post-consumer recycled cup isn’t the only solution. The “Ecotainer”, a compostable corn-based cup, was debuted in 2007 by Tully’s Coffee and International Paper. Since its introduction, the cup has been well received. Did Starbucks choose the wrong cup?
Jim pointed to some major issues with corn-based cups that didn’t fit well with Starbucks. Firstly, the compostable cup shifts the eco-responsibility from the company to the coffee-drinker. For a corn-based cup to have an effect, the consumer needs to throw the used cup into a compost bin. No compost bins around? Uh oh, then that compost cup is destined for a landfill.
For Tully’s and other local coffee shops this wasn’t a big issue – composting is a growing movement throughout Seattle and the Pacific Northwest. But Starbucks is a global company that needs global ideas, and composting just isn’t being done on a global scale …yet. That’s not to say Starbucks is anti-composting. My lunch from Starbucks Headquarters was wrapped in compost-friendly packaging. And judging by the overflowing compost bin – and the nearly empty garbage can next to it – it seemed the compost idea is a hit with corporate employees.
Jim also noted that corn-based products can have other unforeseen consequences. Mexican citizens staged riots in 2007 because of high tortilla prices brought on by high corn prices. Many blamed the high prices on a soaring demand for corn to provide for the US with biofuels. Even in the US, consumers have seen food prices increase dramatically. Considering that Starbucks serves up 2.3 billion coffee cups a year, perhaps we should all be glad for the pass on compostable cups.
By choosing a disposable cup with recycled materials, Starbucks avoids both of those problems. According to Jim, Starbucks’ 10% PFC cup helps “close the demand loop” for recycled materials and will ultimately help stimulate the recycling business – a worthy cause in my book. The recycled content hot cup also guarantees a better eco-impact than standard cups, regardless of compost bin convenience.
In the near future, Jim hopes to see even bigger environmental policies enacted at Starbucks. Over the next year, Starbucks will reestablish ceramic cups as their standard for serving coffee, and pursue strategies to offer recycling throughout their stores. The company also participates in a variety of environmental coalitions to find solutions to sustainable packaging, supply chain sustainability, and creating the ultimate “to-go” cup – one that can be fully recycled.
And for customers who bring their own cups? Jim hopes to increase the number of BYOC customers by tenfold by 2010. He wasn’t ready to share the company’s strategy to make this happen, but who knows? Maybe a Sustainability Is Sexy campaign is just what an eco-friendly Starbucks needs.
They say half of all new businesses fail within the first year. They also say half of those remaining fail within the second year. By the third year, any business owner still around undoubtedly knows how to play the game.
It’s easy to tell if a coffee house is run by one of these vetted business intellects. The tell tale signs are visible almost immediately upon entering the store; ceramic mugs by the espresso machine, or signs urging customers to bring their own coffee cup by the register. By the time I pay for a coffee, the message is clear –this coffee shop thinks disposable cups are bad for business. Being a thrifty consumer, that small discount I earn when I BYOC always puts a smile on my face. But the smile of the coffee shop owner must be in a class all of its own. Thanks for the discount, I think to myself. No, thank you, the coffee shop owner chuckles back.
How are disposable cups bad for business? Truth be told, it’s all because of the bottom line. Disposable cups cost money, and high overhead costs can be fatal to a business. Even more so, offering disposable cups does nothing to enhance customer appreciation, nor does it help a coffee house attract new customers. The coffee industry is already oversaturated with competition – and it’s becoming more important to stand out from the crowd.
These conclusions are illustrated in a study published by Starbucks and the Environmental Defense Fund. The two organizations teamed up in April of 2000 to develop a set of strategies to reduce the environmental impact of serving coffee. In so doing, the group also found that reducing their environmental impact contributed toward better finances in three specific ways:
First, let’s examine the claim that the supporting reusable cups saves coffee houses money. At its heart, it’s a logical claim. After all, when customers BYOC, coffee houses don’t have to pay to purchase disposable cups. This might seem like small savings, but the table below (reproduced from the Starbucks/EDF report) illustrates just how quickly it can add up:
Researchers concluded that Starbucks could save hundreds of dollars a day just by offering reusable coffee cups. Depending on the size of a coffee house’s customer base, the potential savings are impressive.
The second claim - that reusable cups increase customer satisfaction - originates from market research studies published in the same Starbucks/EDF report. Researchers found that 82% of customers surveyed favored reusable coffee cups. These customer noted that reusable cups “insulated coffee well, were attractive, and prevented waste” - all very good reasons. 59% of those surveyed cited environmental concerns as their primary reason for supporting reusable coffee cups. Interestingly, this survey took place in 2000, before global warming became a main-stream issue in the public eye. Chances are that even more customers favor reusable coffee cups in a “post-An Inconvenient Truth” world.
The final claim is that reusable cups can help a coffee business develop an identity to which customers can relate. Marketing people call this “developing brand equity”. Customers may think, I can buy my coffee anywhere, so why should I buy it at this coffee house? The answer is in a company’s brand. For example, drinking a Starbucks coffee has always been more than just coffee. Beginning in the 90’s, that white cup and green logo became part of an image, even part of a lifestyle. Right now, McDonald’s is working to brand its new espresso products as the antithesis of Starbucks. Billboards that state “Espresso served cold, not snobby” are hoping to capitalize on consumers who like their espresso, but don’t identify with the Starbucks image.
So how do reusable cups factor into positive brand equity? Remember that more than half of surveyed coffee drinkers care about the environment, and those same coffee drinkers are looking for businesses with which they can identify. A coffee house which displays support for reusable coffee cups is also branding itself as an environmentally aware and socially conscious business - something which is important to more than half of all coffee drinkers!
Regardless of the environmental implications, it’s hard to ignore the positive financial benefits reusable coffee cups offer. Sustainability Is Sexy offers programs which help businesses transform the potential of reusable coffee cups into real results. More information about these programs can be found at www.SustainabilityIsSexy.com/Join.html.
To steal from conventional investing wisdom – why should a business work to pay for coffee cups, when those coffee cups could be working to pay the business?
While cruising the internet, I found a fantastic video on disposable paper cups. The clip is about 90 seconds long, and was made by a group of students at the University of Washington. Besides the collection of great pictures and impressive facts, the message is important - that using your own coffee cup can have an astounding environmental impact. It’s worth watching.
To those familiar with Sustainability Is Sexy, the message will be familiar. The video does; however, point out one interesting fact that SIS hasn’t touched - There are no recycling bins in Starbucks stores.
Why is this? After all, Starbucks is headquartered in Seattle, a caldera of eco-awareness. And the Emerald City doesn’t just talk the talk when it comes to the environment. According to Sustainable Industries, Seattle broke records in 2006 when nearly 50% of it’s collected waste went to recycling plants. The city did it again in 2008, when Seattle Mayor Greg Nickels banned plastic water bottles from city events, and proposed a fee on all paper and plastic grocery bags (a first in the nation, according to the Seattle Times).
However, it’s doubtful that Starbucks suffers from evil corporation syndrome. In fact, the answer may lie more in the realm of common sense. Most of the garbage produced by Starbucks is in the form of disposable coffee cups - and those cups can’t be recycled. The 2.3 billion “to-go” cups used by Starbucks every year are made from paper and covered with a thin plastic coating during the manufacturing process. SIS research shows the polyethylene plastic keeps liquids from leaking - but also renders the cup unrecycleable.
Not to say that Starbucks isn’t a purveyor of the problem. Twenty years ago, a stop into a coffee house was a rare part of morning routines. It was the Starbucks expansion in the 1990’s that led to the coffee culture phenomenon. And that phenomenon led to the prevelance of disposable coffee cups. Today, there’s not only a Starbucks on every corner, but a disposable cup in every coffee drinker’s hand.
So what can be done about the 2.3 billion cups that land in our nation’s dumps every year? Some environmentalists advocate that Starbucks should do more to make a recycle friendly cup. According to an article in the Columbus Dispatch, a manager of materials and engineer at SOLO Cup believes Starbucks isn’t doing all the can. “It’s all about the money; the question is whether they would be willing to pay for it”. Others advocate for a the coffee giant to make compostable cups, as does it’s regional rival, Tully’s Coffee.
However, both of these band-aid solutions avoid the real problem at hand - that our caffeine habits have become reliant on disposables. In the end, it’s up to the consumer. As an eco-friendly coffee drinker, you have the option to use your own reusable mug every day. Bring it! You’re efforts will save trees and energy, and reduce landfill garbage. If every coffee drinker used their own cup, there would be no need for recycle friendly disposables.
Who knows, maybe one day we could even rid Starbucks of the need for garbage cans too.
Environmentalism is more than just coffee beans for Starbucks. “What about the eco-impact of disposable paper coffee cups?” I asked over my sandwich. After all, the 16 billion paper coffee cups used in the US every year add up to a lot of landfill garbage and consumed natural resources. Jim pointed out that Starbucks was the first company to offer paper coffee cups partially made from recycled content. The cups, 10% of which is post-consumer recycled fiber (PCF), is estimated to save tens of thousands of trees, a half million gallons of wastewater, and several million pounds of garbage from being trucked to landfills.
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