Starbucks to Share Profits With Community Organizations

The company is partnering with organizations in Harlem and Los Angeles to start a new era of corporate giving.

Posted: 10/04/2011 03:34 PM EDT
Starbucks To Share Profits With Local Organizations

The next time you buy that skinny mocha latte from a Starbucks in Harlem or Los Angeles, you just may be helping to fund local community organizations.

Starbucks Corp. announced Tuesday that under a new program it will share profits from two of its U.S. stores with community organizations to pilot what Starbucks is calling a new “community business model” that it hopes other corporations will emulate.

The program will forge a profit-sharing partnership with the Abyssinian Development Corporation in Harlem and the Los Angeles Urban League in the Crenshaw district. Starbucks will donate a minimum of $100,000 in the first year of the program.

“These two partnerships are intended to help us learn how our company can successfully join with change-making community organizations in a localized, coordinated and replicable way,” said Howard Schultz, CEO of Starbucks Corp.

Both the company and the organizations involved hope that the program’s modest beginnings will snowball into something greater.

"It's not going to be a million dollars a year," said Blair Hamilton Taylor, who leads the Los Angeles Urban League — Starbucks partner in Crenshaw. "But if McDonald's decides to do this next week, and then Wendy's decides to do it, and Burger King decides — now all of the sudden you do have a million dollars," he said. "My hope is that is what this triggers."

In addition to donating money, the partner stores in Crenshaw and Harlem will serve as the hub of Starbucks' community service and training programs in the area, which will provide the surrounding communities with programs on leadership, job and life skill development, positive learning environments and overall health and wellness.

The announcement comes just one day after the company unveiled its new Create Jobs for USA program that will offer loans to small businesses and non-profits other organizations in distressed communities in order to stimulate job growth. The campaign begins Nov. 1 and Starbucks customers will be able to make donations of $5 or more at Starbucks stores nationwide to support the initiative.

(Photo: REUTERS/Joel Boh)