November 29, 2023

Starbucks Seeks to Keep Guns Out of Its Coffee Shops

The policy change came on the heels of a shooting rampage at the Washington Naval Yard on Monday that left 13 people including the gunman dead, but Starbucks said its decision was not in response to that or to the shooting spree that killed 26 children and adults at the Sandy Hook Elementary School in Newtown, Conn., just days before Christmas last year.

“I’ve spent a significant amount of personal time on this issue in the last several months and I’ve seen the emotionally charged nature of this issue and how polarizing it is on both sides,” Howard Schultz, the chief executive of Starbucks, said in a telephone interview. “Nevertheless, customers in many stores have been jarred and fairly uncomfortable to see guns in our stores, not understanding the issue and feeling that guns should not be part of the Starbucks experience, especially when small kids are around.”

Under the change, baristas and other store employees will not ask customers who come in with guns in holsters, say, to leave or confront them in any way, Mr. Schultz said. No signs explaining the policy will be posted in Starbucks stores, either.

“We are going to serve them as we would serve anyone else,” he said. “There are going to be people on both sides who will be disappointed or angry, but we’re making a decision we think is in the best interests of our customers, employees and the company.” He said store officials would evaluate compliance over time and consider posting signs if necessary.

The majority of company-owned Starbucks stores are in states that allow people to openly carry guns, although restrictions and limitations vary from state to state. The company has had a handful of armed robberies in its stores over the years, as well as two recent incidents where guns carried in women’s purses have discharged accidentally, but little other gun violence in its stores.

Under its previous policy, however, Starbucks has been unwillingly co-opted by proponents of “open carry” policies and vilified by those seeking stricter laws on gun ownership. Garry Trudeau devoted six consecutive days of his Doonesbury comic strip in 2010 to mocking the company’s stance, which opened with a barista greeting a customer in a plaid flannel shirt and saying, “Welcome to Starbucks, sir, would you be openly carrying a weapon today?”

“Pro-gun activists have used our stores as a political stage for media events misleadingly called ‘Starbucks Appreciation Days’ that disingenuously portray Starbucks as a champion of open carry,” Mr. Schultz wrote in an open letter to be published in ads in major newspapers.

Last month, Starbucks closed a store in Newtown early after gun rights supporters wearing camouflage and Connecticut Citizens Defense League T-shirts held one of the events there.

Similarly, opponents of guns like the group Moms Demand Action for Gun Sense in America, which advocated “Skip Starbucks Sundays,” have staged protests outside Starbucks stores and urged consumers to boycott the company.

In 2010, the Brady Campaign to Prevent Gun Violence teamed up with Credo Action, an activist group that uses mobile technology and social media to push change, and attracted more than 40,000 signatures on a petition aimed at changing the company’s policy on guns in its stores that was delivered to Starbucks headquarters in Seattle.

“It sounds like Howard Schultz is making a very good business decision,” said Brian Malte, director of legislation and mobilization at the Brady Campaign. “Lots of families with children, college students and young people are Starbucks customers, and they want to feel safe.”

The company has long followed local laws regarding the ability to carry guns in plain sight. Customers in the 44 states that allow legal gun owners to carry weapons openly have been permitted in its stores there, while those in the six other states – New York, California, South Carolina, Illinois, Florida and Texas – have not, according to the Law Center to Prevent Gun Violence.

“I want to make it very clear that Starbucks is not a policy maker and as a company we are not pro- or anti-gun,” Mr. Schultz said. “However, there have been a number of episodes over the course of the last few months that have put us in a position to take a big step back and assess the issue of open carry.”

Most other restaurant chains and retailers follow policies similar to the one Starbucks is abandoning, although Peet’s Coffee Tea and California Pizza Kitchen ban guns from their stores altogether. Disney also forbids guns in its theme parks, and Costco does not allow its members to carry them openly in its stores.

“While Peet’s Coffee Tea respects and values all individuals’ rights under the law, like many other private retail establishments, our policy is not to allow customers carrying firearms in our stores or on our outdoor seating premises unless they are uniformed or identified law enforcement officers,” the company said in a statement forwarded by a spokeswoman.

A spokeswoman for the National Restaurant Association said the organization does not have a list of its members’ policies on guns but noted that some states that have open carry laws on the books still prohibit public display of firearms in restaurants.

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G-20 Backs Plan to Curb Tax Evasion by Large Corporations

In one widely cited example, Starbucks has managed to post a profit of nothing in Britain even after selling untold millions of beverages and baked goods. Apple drew scrutiny for leaving billions of dollars in profits overseas and instead passing along the fruits of its commercial success to shareholders by taking out loans.

In light of such practices – which are entirely legal, but take advantage of differing tax rules around the world – the Organization for Economic Cooperation and Development is proposing that all nations adopt a list of 15 new tax principles for corporations. The plan focuses only on corporations and would, if adopted widely, shift some of the global tax burden toward large companies and away from small businesses and individuals.

The list, presented Friday at a meeting of finance ministers of the Group of 20 countries in Moscow, includes ideas to prevent corporations from so-called “treaty shopping” for the best pair of countries to do business in – presumably, one with good infrastructure, education and defense, the other with low taxes.

The group recommended strict rules for defining where a company has a permanent presence. It also proposed three measures to limit the practice of transfer pricing: the shunting of profits and losses between subsidiaries disguised as internal corporate payments for goods or, increasingly common, copyright or patent royalties.

If accepted, the countries in the Group of 20 would commit to the reform at a gathering of heads of state in St. Petersburg, Russia, in September.

“It’s a matter of justice and fairness,” Angel Gurría, the secretary general of the O.E.C.D., said at the presentation of the new plan with the finance ministers of France, Britain, Germany and Russia.

Pierre Moscovici, the minister of economy and finance of France, said some multinational corporations manage to pay an income tax of 3 percent or so. “This is unbelievable to our fellow citizens, who pay their fair share,” he said.

Shifting profits to low-tax countries and costs to high-tax countries is less an option for small businesses and individuals, who inevitably wind up carrying more of the tax burden as a result.

In the United States, for example, corporate profit taxes contributed 40 percent of all income tax to the United States Treasury 50 years ago. Today, corporations contribute less than 20 percent, with the slack taken up by small companies and those paying individual income tax.

The instance with Starbucks in Britain is telling. It legally reported profits close to nothing after paying high prices for coffee and for brand royalties to other subsidiaries of the coffee giant that were domiciled outside the jurisdiction of British tax authorities.

In contrast, the owners of a small coffee shop would probably not be able to pay royalty fees to an overseas company owning the rights to the name of their cafe, thus increasing their costs and lowering their tax liability. That multinationals can quite easily do so, however, creates an uneven playing field for small restaurant owners, critics contend – even if they provide better coffee at a better price.

The reform is intended to address such inequities, the minsters said.

Starbucks violated no laws in Britain. All the same, the company volunteered to pay about $16 million in additional taxes to the British government in future years, saying it understood its British customers were upset by the outcome of the tax rules the company was following.

Though the United States did not have a representative at the presentation, the Obama administration has endorsed the international reform and signed an initial commitment earlier this year.

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Starbucks Earnings Increased 13% in Latest Quarter

The company’s results were helped by a 6 percent increase in global sales at cafes open at least a year.

The performance reflects the turnaround Starbucks has made since its struggles during the recession. After bringing back its founder, Howard Schultz, as chief executive in 2008, the company embarked on a reorganization that included closing underperforming stores in the United States.

Mr. Schultz has said that the company has the ability to keep growing even through a turbulent economy because most people see Starbucks as an “affordable luxury.”

Starbucks said it earned $432.2 million, or 57 cents a share, in the quarter, up from $382.1 million, or 50 cents a share, a year earlier. Revenue in the period ending Dec. 30, the first quarter of Starbucks’s fiscal year, rose 11 percent, to $3.8 billion. Analysts had expected a profit of 57 cents a share and revenue of $3.85 billion, according to FactSet.

Shares rose 11 cents on Thursday, to $54.57 a share.

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Letters: Letters: Paying With Pennies

Re “Dear Starbucks: A Penny for Your Thoughts” (Strategies, Jan. 15), which described how Starbucks had raised the cost of a tall cup of coffee in Manhattan to $2.01, after tax:

I have a totally different reaction to that not-so-round price.

Every day I leave my apartment with a scooped-up handful of change, hoping to use it when paying for odd-priced items. How satisfying to buy a bag of clementines for $6.99 and plunk down 99 cents on the counter: it lightens my pocket and I get four almost weightless singles back from a $10 bill. Starbucks should be congratulated for helping us recycle our coins and reduce our mounds of change. Allan Ripp

Manhattan, Jan. 16

To the Editor:

If you’re thinking of buying a cup of coffee at a Manhattan Starbucks, here’s a whimsical idea: Go to the bank and exchange $2 for four rolls of pennies. Pour them into a clear plastic bag. Then go to Starbucks and order your tall cup of coffee. When the barista tells you the price, hand her the bag — with an added penny and a smile. Samm Carlton

Waquoit, Mass., Jan. 15

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Business Briefing | Company News: Lululemon Athletica’s Founder Takes a Step Back

Lululemon Athletica, the yoga wear retailer, said on Friday that Dennis J. Wilson, its founder and former chief executive, would leave his remaining executive role as chief innovation and branding officer at the end of January. The company, which is based in Vancouver, British Columbia, offered no explanation about the move. He will remain as chairman. Christine Day, a former Starbucks executive, has been the company’s chief executive since 2008. Mr. Wilson, who is known as Chip, has said that he was greatly influenced by Ayn Rand and has used her books, which promote the idea of people living for their self-interest, to guide his business. Last November, Lululemon provoked an outcry from some customers after it used the opening line from Rand’s “Atlas Shrugged” on its shopping bags.

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Starved State Budgets Inspire New Look at Web Gambling

So district officials want residents to gamble closer to home — inside their homes, actually. Or in cafes, restaurants and bars. By year’s end the district hopes to introduce an Internet gambling hub that would allow Washington residents to play blackjack, poker and other casino-style games.

“They can do it from Starbucks, a restaurant, bar or hotel, or from a private residence,” said Buddy Roogow, executive director of the D.C. Lottery, who expects the new games to eventually raise $9 million a year. “That’s real money in D.C.”

It’s an idea gaining currency around the country: virtual gambling as part of the antidote to local budget woes. The District of Columbia is the first to legalize it, while Iowa is studying it, and bills are pending in places like California and Massachusetts.

But the states may run into trouble with the Justice Department, which has been cracking down on all forms of Internet gambling. And their efforts have given rise to critics who say legalized online gambling will promote addictive wagering and lead to personal debt troubles.

The states say they will put safeguards in place to deal with the potential social ills. And they say they need the money from online play, which will supplement the taxes they already receive from gambling at horse tracks, poker houses and brick-and-mortar casinos.

“States had looked at this haphazardly and not very energetically until the Great Recession hit, but now they’re desperate for money,” said I. Nelson Rose, a professor at Whittier Law School, where he specializes in gambling issues.

When it comes to taxing gambling, he said, “the thing they have left is the Internet.”

Federal efforts over the last year to legalize online gambling have failed, so the moves by the District of Columbia and the states have put them into a murky legal arena with a potentially big obstacle. The Justice Department in recent years has vigorously pursued operators of offshore Internet casinos, shutting down their sites and arresting their executives when they travel to the United States.

The agency’s position has been that these operations violate federal laws including the Wire Act of 1961, which prohibits wagering over telecommunications systems that cross state or national borders.

The move by states to allow online wagering prompted two United States senators last month to ask the Justice Department to quash those efforts, too. In their letter, Senators Harry Reid, a Nevada Democrat, and Jon Kyl, Republican of Arizona, said that about a dozen states were considering such efforts.

“In many cases, Internet gambling advocates in those states cite the silence of the Department of Justice in the face of these efforts as acquiescence,” the letter says. “We respectfully request that you reiterate the Department’s longstanding position that federal law prohibits gambling over the Internet, including intrastate gambling (e.g. lotteries).”

Alisa Finelli, a spokeswoman for the Justice Department, declined to comment beyond saying that the department was considering the senators’ letter.

In the past, federal prosecutors have sent letters to a handful of states telling them that federal law prohibits “all forms” of online gambling. And in 2006, Congress passed the Unlawful Internet Gaming Enforcement Act, which prohibits businesses from taking the proceeds of illegal bets placed over the Internet.

But legal experts say the law sent a mixed message to the states. It seems to carve out an explicit exception for states to run online gambling operations. But in the bill’s legislative history, it says it is not meant to amend existing law on the subject, which can be taken to mean that the Wire Act prohibitions still apply, said Mark Hichar, a lawyer who specializes in gambling law at Edwards, Angell, Palmer Dodge in Boston.

“The legislative history is a real head-scratcher,” Mr. Hichar said.

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Preoccupations: Daring to Stumble on the Road to Discovery

Jobs, careers, valued skills and industries are transforming at an unheard-of rate. And all of the change and uncertainty can make us risk-averse and prone to getting stuck.

Despite these realities, our education system emphasizes teaching and testing us about facts that are already known. There is much less focus on our ability to discover, create and reinvent.

The same often holds true in the workplace. Perfection is rewarded, while making mistakes is penalized. It’s no wonder that “failure” has taken on a deeply personal meaning, something to be avoided at nearly all cost.

The skills we’re taught work well for familiar situations, yet we’re trained to perfect our ideas and use the past to predict the future with linear plans in a nonlinear world. As such, we need a completely new mind-set. Linear thinking is a death knell for creativity.

When I worked as a venture capital investor, I found that most successful entrepreneurs don’t begin with perfected ideas or plans — they discover them. Entrepreneurs think of learning the way most people think of failure.

A prime example is Howard Schultz, one of the most successful entrepreneurs of our time. When he started what would become Starbucks, he modeled the first stores after coffeehouses in Milan, a new concept for the United States in the 1980s. He was clearly onto something, but the baristas wore bow ties — which they found uncomfortable — and customers complained about the nonstop opera music and menus that were written primarily in Italian. And the early stores had no chairs. Mr. Schultz routinely acknowledges that he and his team made a lot of mistakes. But they learned from them, as they did from countless other experiments.

Consider another example — what it takes to create great comedy. Editors at The Onion, the humor publication, estimate that they try out hundreds of headlines each week before they finally decide to use only a small percentage of them.

Even the most successful stand-up comedians, like Chris Rock, try thousands of new ideas in front of small club audiences in order to develop a one-hour act. Some jokes fail, but Mr. Rock is willing to be imperfect; he persists night after night because every small bet takes him closer to a brilliant act on the big stage.

This is how comedians and entrepreneurs must work — by making countless small bets to discover what works. The real genius is in the approach.

The same holds true for leaders, managers and collaborators. They must to be willing to learn from mistakes. Affordable risks should be encouraged, and small failures celebrated — these are the mark of learning organizations. Otherwise, risk aversion will lead to stagnation and decline.

In a time when valued skills and occupations shift constantly, we must be able to discover interests, opportunities and careers by experimenting. Or by reinventing ourselves altogether.

The architect Frank Gehry, for instance, designed relatively conventional buildings for much of his early career. But inspired by how contemporary painters and sculptors worked, Mr. Gehry performed a series of experiments on his own house in Santa Monica, Calif., during the late 1970s .

Working with plywood, corrugated metal and chain-link fencing, he built a new exterior around his original house.

His experiments were the precursor to what would become his distinctive style, evident in the Guggenheim Museum Bilbao in Spain and the Walt Disney Concert Hall in Los Angeles. The money was good in conventional architecture, yet he decided to start anew, using his own style and voice.

INVENTION and discovery emanate from the ability to try seemingly wild possibilities; to feel comfortable being wrong before being right; to live in the world as a careful observer, open to different experiences; to play with ideas without prematurely judging oneself or others; to persist through difficulties; and to have a willingness to be misunderstood, sometimes for long periods, despite the conventional wisdom.

All these abilities can be learned and developed, but doing so requires us to unlearn many of our tendencies toward linear planning and perfectionism.

As the technology pioneer Alan Kay put it: “The best way to predict the future is to invent it.” It begins with a little bet. What will yours be?

Peter Sims is the author of “Little Bets: How Breakthrough Ideas Emerge from Small Discoveries.”

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Advertising: Bargains on Flash Sale Sites Serve a Long-Range View

After Saint Parfum sold $55 candles perfumed with peony and grapefruit for $25 on the flash sale site One Kings Lane, visitors to Saint Parfum’s own Web site spiked to 6,000, from about 250 on a typical day. In the next few months, sales of full-price merchandise on Saint Parfum’s Web site and at retailers also climbed, and 20 new retailers asked to sell the candles.

“We don’t profit much, because of the discount,” said Spencer Krenke, Saint Parfum’s founder and perfumer. “But more important is that what we gain is long-term, loyal customers.”

Saint Parfum’s experience has become the norm for many brands that sell discounted merchandise on flash sale sites like One Kings Lane, Gilt, HauteLook, MyHabit and Ideeli. Brands like Volkswagen, Brooks Brothers and Starbucks have used the sites for marketing campaigns.

The phenomenon is an example of the muddled lines dividing editorial, advertising and commerce online as Web sites increasingly serve all three purposes. And it is the latest evidence that shoppers, overwhelmed by the options online, are turning to e-commerce sites that do the choosing for them, narrowing the selection and giving advice on which brands to buy.

“It’s really becoming less about dumping inventory and more about shining a spotlight on a new or existing brand,” said John Gerzema, executive chairman of BrandAsset Consulting, a marketing strategy firm. “Getting an endorsement from a company like Gilt or HauteLook or Ideeli is really a way to get your brand a higher profile that spending additional marketing dollars really can’t do.”

One Kings Lane, which sells discounted home décor, says that these days it is as much a marketing company as an e-commerce company.

“Our pitch actually starts that way now,” said Susan Feldman, co-founder of One Kings Lane. “Instead of, ‘We can help you with your excess and closeouts,’ the marketing part of it is really much more powerful.” introduced its flash sale site,, in March, partly because brands that sell on other Amazon sites said they wanted to use flash sales to get in front of new customers, said Maria Renz, president of MyHabit.

Amazon’s merchandise buyers write testimonials about the brands at the top of each sale page, and Amazon prominently links to the Web sites of the brands so customers can also shop there.

“We’re very happy to also drive traffic to the brands,” Ms. Renz said. “At the core, these sites are great ways to introduce your brand to a new customer.”

Some brands have started using Gilt, the most prominent of the flash sale sites in the United States, to introduce products instead of selling overstock.

To introduce the 2011 Jetta, Volkswagen sold three of the $15,995 cars for $5,995 on Gilt. Fifty-five thousand people who missed out added their names to the wait list, and Volkswagen sent them $500 coupons to buy or lease a Jetta.

Volkswagen sold 69 full-price cars as a result of the Gilt sale and has an e-mail list of interested customers, said Charlie Taylor, general manager of digital marketing for Volkswagen of America.

“This wasn’t a sales objective, it was only three cars,” Mr. Taylor said. “It was very much an awareness play, meant to build buzz.”

Brooks Brothers introduced its Back to Campus line, slimmer-fitting clothes for younger men, by selling the clothes at full price on Gilt Man six weeks before selling them in stores to advertise to younger men who shop on Gilt but not generally at Brooks Brothers.

Seventy percent of the buyers on Gilt Man were under 39, according to Brooks Brothers.

Some of the flash sale sites are evolving into online fashion or design magazines. They often serve as copywriters, photographers and stylists for the brands, melding commerce and editorial in ways that were never possible for print publications.

“We are moving toward being an online retailer that understands that our mission is as much to impart information and give you ideas and help you make the best purchasing decisions,” said Susan Lyne, chairwoman of Gilt.

Younger people are more likely to discover new brands online than in magazines or department stores, she said, and they like doing it online because they can buy on the spot.

Gilt employs 100 stylists, makeup artists and photographers to shoot models wearing the clothes. It hired Ruth Reichl, former editor in chief of Gourmet and former restaurant critic for The New York Times, as editorial adviser for its new food site, Gilt Taste, which publishes essays and recipes in addition to selling food.

To promote another Brooks Brothers sale on Gilt Man, Gilt interviewed the costume designer for the detective TV show “White Collar” about men’s fashion on GiltManual, a site with articles like “How to Clash With Panache” and “How to Match Your Suit to Your Shoes.”

One Kings Lane has hired writers from Elle Décor and Domino. It publishes slide shows and articles with tips from designers on how to layer rugs or the latest wallpaper trends.

“These are e-commerce platforms, but they’re also marketing and media platforms rolled into one,” Mr. Gerzema said.

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