Environmental practices

According to the Starbucks annual report, the company knows that the complexity of climate change requires it to think beyond its current action towards the environment. The Starbucks approach is to reduce the environmental impact in all aspects of its business. In the buildings, Starbucks seeks to have green stores which provide energy efficiency through saving energy and water and increasing recycling activities. In pursuing a green store, Starbucks concentrates on green building initiatives to meet long-term environmental impact and cost reduction. In 2013, Starbucks pushed most of its new or existing stores to meet the US Green Building Council’s and Leadership in Energy and Environment Design (LEED) certification standards, and around 65% of its stores achieved LEED (Leadership in Energy and Environmental Design, 2014). In the conservation of energy and water, Starbucks incorporated conserving water and energy strategies into its store design, equipment use, and operation and maintenance systems. According to the Starbucks annual report (Starbucks, 2013), in 2008, Starbucks set a goal of reducing water consumption by 25% by 2015. Today, Starbucks is on track to achieve this goal as it has reached a 21% reduction of the water used in its stores; this has been achievable by implementing new reverse osmosis filtration retrofits in 503 stores in the US and Canada. Reverse osmosis provides a high level of water filtration. Moreover, for energy reduction, Starbucks set a goal in 2008 of reducing energy

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consumption by 25%. Starbucks has tried to implement a number of initiatives to reduce electricity used, but in 2013 the decrease was only 7.1%, which needs improvement. Starbucks has applied energy management systems and these require the equipment providers to design the equipment to be operated at energy-efficient levels. In addition, regarding forest conservation, Starbucks helped farmers in Indonesia save 250,000 trees and participated in the distribution of 200,000 trees in Brazil as well. Moreover, Starbucks seeks to reduce its environmental footprint through mitigating the impact of supply chain, product packaging and equipment used (Starbucks, 2013).

One of the areas in which Starbucks seeks to reduce environmental impact is through recycling its waste. In 2009, Starbucks implemented recycling in 18 markets after initiating three recycling pilot tests. Starbucks tested the capability of post-consumer recycling during a six-week pilot project and, according to the Starbucks annual report, the company has proven that its cups can be accepted as a valuable raw material in the recycling system. However, Starbucks faces some issues regarding recycling, such as some communities recycle the Starbucks paper cups and others do not have the infrastructure in place to handle collection, hauling and processing due to a lack of demand for the cups’ material by the recycling industry. The challenge with recycling the cups is not as simple as putting a recycling bin in every store. Once the consumer puts their cup in the bin, it needs to go somewhere where it can actually be recycled. Also, recycling infrastructure varies widely around the world; hence the Starbucks decision to do its part by implementing efficient and effective recycling strategies by enhancing recycling in its stores. The Starbucks goal is to ensure all the cups are recyclable by 2015. In 2008, Starbucks set a goal of applying front-of-store recycling in all locations because the company found that customers take their beverages outside the store and it is important to develop comprehensive recycling solutions to address this issue. In 2013, 39% of stores implemented front-of-store recycling for customers, which indicates a strong acceptance rate amongst the recycling industries, although there are limitations of recycling technology or inconsistent public policy, lack of infrastructure, and operational challenges in some areas (Starbucks, 2013).

Moreover, back-of-store recycling is another way of recycling in the working area. In 2013, there were 80% locations that had implemented back-of store recycling. However, there are limitations to the application of this type of recycling in all stores, such as operational issues, minimal store space, lack of commercial recycling services and the

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refusal of landlords to provide recycling services on the site. Today, according to the Starbucks annual report (Starbucks, 2013), 67% of Starbucks stores offer recycling facilities with front-of-store and back-of-store recycling in the US and Canada. Also, Starbucks is working with non-governmental organisations, policymakers and competitors to analyse packaging flow through recycling facilities and assessment of the causes for the lack of current recycling services.

Moreover, Starbucks has conducted some activities that support the reuse practices for some materials. For instance, Reclamation Drive-Thru. Starbucks used shipping containers to design these stores. The idea was inspired by the sourcing of coffee and tea, which come from around the world. After many journeys, many containers end up in scrap yards once they reach their average 20-year lifespan. The Reclamation Drive- Thru idea was inspired by a desire to help keep the container used throughout the supply chain. This takes the container out of the waste stream. The results show that a 450 square foot drive-thru and walk-up store can be made from four containers (Allison, 2011). The whole store is contained within the shells of four containers that have been reclaimed, refurnished, renewed and revived. This idea was implemented in Tukwila, Washington.

This is one example of the Starbucks environmental practices to reduce the environmental impact of waste packaging. Starbucks generates four billion paper cups a year (Gunther, 2012) and most of them end up in landfill. Owing to this, Starbucks introduced “for here” mugs in 2008, which allows customers to reuse their own mug, which can have their name on and be left in the store. However, Starbucks found there is a barrier to the use of “for here” mugs in that it is difficult to track them. Then, Starbucks modified its goal in order to increase use of reusable cups in 2011 and 2012 by charging customers 10% more for every paper cup they used whereas the customers who brought their own mug were offered 10% off the price of a beverage. However, the results have shown that the percentage of beverages served in personal cups remained static (Gunther, 2012; Davies, 2013). Hence, Starbucks again amended its goal to increase the usage of personal cups by introducing reusable cups, which are less expensive than other cups because they are made of a lighter material. The initial goal was to increase the number of users of reusable cups to 25% by the end of 2015 but, according to Berr (2013), the high percentage of sales of disposable cups, which reached 80%, would make it difficult to increase the number of reusable cup users. So,

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the goal was later scaled back to increase the number of users of reusable cups to 5% by the end of 2015. It costs the customer £1 per reusable cup and the scheme was launched in the UK in April 2013. As shown in Figure 7-1, the cup is solid and dishwasher-safe. According to the Starbucks official statement (Davies, 2013), it can be re-used thirty times. Unofficially, the cup’s manufacturer has test-washed cups over 170 times without any impact on performance (Davies, 2013). As this research concentrates on reusable packaging from various dimensions and has designed a conceptual framework in order to enhance reusable packaging, it is going to implement the Starbucks case and contribute to identifying a possible solution for Starbucks to continue increasing the number of beverages served in reusable cups. This is achievable through looking at customers’ intentions and behaviour towards reusable cups. At this stage, the research will investigate the customers’ behaviour and identify the drivers towards using reusable cups. Then, the research will look at developing reusable cup attributes by comparing them with a reusable packaging attributes checklist. In this stage, the research will suggest some attributes that could be added to the current design to contribute to increasing the number of customers using the Starbucks reusable cups. Finally, the research will look at the environmental impact of the current Starbucks reusable cup in order to find out how the Starbucks reusable cup can protect the environment, conserve energy and save forests.