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Starbucks’ European Renaissance

From the September 2012 issue.

Michelle Gass, Starbucks President EMEA, tells GCR of her ambitious plans to reintroduce the Starbucks brand to Europe.

Michelle Gass Starbucks President EMEAFinancial journalists couldn’t help but note the slight overreaction of the market when Starbucks released its third quarter results this past July.

What would be good news for most companies during these less-than-prosperous times – US$3.3 billion in net revenue and nearly 20 per cent earnings growth – led to a 10 per cent drop in share price. The dramatic dive was attributed to Starbucks falling just 2 cents short of earnings expectations.

At the centre of Starbucks’ worst news was limited growth from the Europe, Middle East and Africa (EMEA) segment, a region that has historically not performed as well as its American home-base or booming Asia Pacific peers.

These figures may very soon change, however, if Michelle Gass, President Starbucks EMEA, has her way. Dubbed by Forbes as “Starbucks’ secret weapon” Gass is finding her footing in her newly acquired territory.

“EMEA has not been the biggest profit driver of the company. They struggled with it in terms of the economics of this region with high occupancy, high labour costs, and so on. But we don’t take that as an excuse,” she tells GCR in July, on her one year anniversary in the position. “We know there are opportunities… We’re setting out to make an absolutely beloved brand here in Europe. In pockets we have it – but we want to get a lot more.”

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