Starbucks vs. Peets Coffee

If someone claims they are a coffee drinker and go to Starbucks every morning, chances are they do not know much about coffee and they are more likely to get an espresso drink rather than a cup of coffee. Why? Because Starbucks is not known or praised for their coffee like they use to be. Their signature trademark is their latte macchiato’s, caramel frappucino’s, and random coffee themed objects and items that have turned this once original coffee shop, more into an expensive superstore full of gifts and three month old vacuumed sealed beans.

Order a medium, excuse me, I mean “grande” coffee, and the barista will look at you as if you just got out of the loony bin. Peet’s Coffee and Tea, a corporate coffee shop just like Starbucks but nearly not as huge, has constantly and is still constantly putting its focus and efforts in selling high-quality coffee beans and teas to its customers, rather than focusing on the sales of espresso drinks and useless gifts to people who can even afford them. Quality is over quantity when comes between Peet’s Coffee and Tea, and Starbucks Coffee is rather the other way around.

Peet’s Coffee and Tea was established by Alfred Peet, an immigrant from Holland who worked for the tea business then moved to San Francisco in 1955 working for coffee importers for nearly a decade. Alfred was not satisfied with the coffee he came across people drinking and wanted to expose coffee drinkers to strong, better tasting, and higher in quality coffee. “Before I started, people were drinking Folgers and Hills Bros. , and I thought, ‘God no, there must be something better,’ ” Alfred Peet.

In 1966, he opened his first store in Berkeley, California after his family name and specialties, which was gourmet coffee and tea. The European style dark roasted coffee beans and aroma that came with it became a trademark of Peet’s. The smell of fresh coffee and beans always reminded customers why they were even in there in the first place. Before Alfred died in 2007, he worried that the new gourmet coffee industry would grow too fast, and that it would not be able to maintain the quality that has attracted so many of new coffee addicts. If you want to make a business big, the quality must suffer,” he said. Without Peet’s, it is unlikely there would be a Starbucks. In 1970, three college students, Jerry Baldwin, Gordon Bowker, and Zev Siegl, decided to open their first Starbucks coffee shop in Seattle, Washington after experiencing gourmet dark roasted coffee in Europe. Alfred Peet agreed to supply them with his roasted beans, and helped them find suppliers for grinders, roasters and other essential equipment. Eventually Zev Siegel left Starbucks to pursue other things.

In 1984, Jerry Baldwin and Gordon Bowker, not satisfied with the direction and way Starbucks was heading in, sold the Starbucks Coffee company to Howard Shultz and ironically bought Peet’s Coffee and Tea. Howard Shultz is the reason for Starbucks being where it is today. The massive store chains and gourmet menu has led Starbucks as a leader in the gourmet coffee industry, but not necessarily in coffee. They supply in bulk, they have to at the rate of stores that are located all around the world. To supply in bulk, coffee growers have to come up with hybrid species, use pesticides on large plantations and intervene in other ways that inevitably have an effect on the taste of the coffee,” Alfred Peet. Originally, Peet’s Coffee and Tea, and Starbucks Coffee started as a small-scale, personalized, and high-quality gourmet coffee shop aimed at serving European style coffee for customers who would appreciate it the most. Peet’s Coffee was like the father, mentor, and inspiration of coffee and beans to Starbucks in its beginning stages.

Starbucks eventually starting growing at an alarming rate, creating more stores and moving away from the coffee bean concept, and instead into a different direction of espresso and foam. More chains lead to more people which equal to more products. There is an estimate of 200 Peet’s Coffee and Tea stores in the United States, most of them located in California. There are 15,756 Starbucks stores in 44 countries. To have that many stores, serve that many people, and ensure they still maintain the best and highest quality of beans, really sets some doubts.

Starbucks has truly become the McDonald’s of the coffee industry because of the supply and demand. In the Starbucks business, quantity is greater than quality because quantity equals to money, where as quality costs more money. There is no win/win situation with this equation when your business is serving practically the world. Despite Peet’s Coffee and Tea being a corporate company, and the amount of stores it has produced, the goals and ambitions have not changed much. Coffee beans and tea’s are still the main focus of Peet’s and where they get most their revenue from.

Bill Lilla, Peet’s executive vice president, said his company ensures quality through long-term relationships with growers, and by paying them more than the going rate. On the other hand, Starbucks Coffee insists their size has not affected quality, but it is hard to believe when their size is above and beyond the thousands. As the saying goes, too many cooks ruin the stew, and in this case, Starbucks would be the cooks, and its coffee and early aspirations are the stew.

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