Expansion Management

Starbucks Chooses Domestic Production

July 13, 2012

Breaks ground on factory in Georgia that would have cost 15-20% less in other locations

Starbucks, who has said that creating jobs in America is ethically important,
broke ground on its new facility in Augusta, Georgia on Friday.

In talking about the plant earlier this month, CEO Howard Schultz said, "we have announced a new roasting plant in Augusta, Georgia that we could have located in Central America or Asia for 15% to 20% less, but we felt that creating 200 or so jobs domestically was more important.

The $172 million plant is expected to create 140 high-quality American manufacturing jobs, in addition to hundreds of indirect jobs related to construction, shipping and other supply chain functions.

Approximately 75% of the plant's workforce will be comprised of skilled processing workers, including maintenance and engineering technicians as well as roasting operators, soluble process operators, and packaging operators. The remaining 25% will be comprised of management and administrative staff. Plant partners will be offered a competitive compensation and benefits package.

Once complete in early 2014, the facility will produce products currently manufactured abroad, including Starbucks VIA Ready Brew as well as the coffee base for Frappuccino blended beverages and many of Starbucks ready-to-drink beverages. The soluble plant will be Starbucks fifth manufacturing facility in the U.S., adding to the company's existing network of four roasting plants which currently employ more than 830 partners (employees) in Kent, Wash., York, Pa., Sandy Run, S.C., and Carson Valley, Nev. Designed to be LEED(R) certified, the 180,000 sq. ft. soluble plant will be capable of producing up to 4,000 metric tons per year.

The company points out that the labor differential is mostly responsible for the cost gap, but that the company will save on transportation and other improved quality.

Job creation in the U.S. is a priority for the company which recently launced, the fund "Create Jobs For USA" to provide loans to small businesses. the national campaign is designed to help jumpstart the economy with a focus on job creation in many of America's most underserved communities. Through the Create Jobs for USA Fund, 100% of donations from Starbucks customers goes quickly to community development financial institutions to provide necessary financing to community businesses committed to creating and sustaining jobs.

In the first three months of the Create Jobs for USA program, Starbucks and the Starbucks Foundation have raised more than $7 million in donations, which in turn has translated into $50 million in financing for community businesses.

About the Author

Adrienne Selko | Senior Editor

Focus: Workforce, Talent

Follow Me on Twitter: @ASelkoIW

Bio: Adrienne Selko has written about many topics over the 17 years she has been with the publication and currently focuses on workforce development strategies. Previously Adrienne was in corporate communications at a medical manufacturing company as well as a large regional bank. She is the author of Do I Have to Wear Garlic Around My Neck? which made the Cleveland Plain Dealer's best sellers list. She is also a senior editor at Material Handling & Logistics and EHS Today.

Editorial mission statement: Manufacturing is the enviable position of creating products, processes and policies that solve the world’s problems. When the industry stepped up to manufacture what was necessary to combat the pandemic, it revealed its true nature. My goal is to showcase the sector’s ability to address a broad range of workforce issues including technology, training, diversity & inclusion, with a goal of enticing future generations to join this amazing sector.

Why I find manufacturing interesting: On my first day working for a company that made medical equipment such as MRIs, I toured the plant floor. On every wall was a photo of a person, mostly children. I asked my supervisor why this was the case and he said that the work we do at this company has saved these people’s lives. “We never forget how important our work is and everyone’s contribution to that.” From that moment on I was hooked on manufacturing.

I have talked with many people in this field who have transformed their own career development to assist others. For example, companies are hiring those with disabilities, those previously incarcerated and other talent pools that have been underutilized. I have talked with leaders who have brought out the best in their workforce, as well as employees doing their best work while doing good for the world.