Starbucks Food Donation Guide
Starbucks Food Donation GuideStrategies to manage costs and effectively create a food donation programApril 2021This presentation is based on our experience in setting up a food donationprogram. Nothing in it should be taken as legal advice. 2021 Starbucks Coffee Company
C ON TEN TSFood Donation Guide Objectives3Hunger, Food Rescue & How You Can Help4Road to Program Creation10Appendix242 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Food Donation Guide Objectivesv Create an open-source learning platform to share Starbucks food donation best practicesv Increase the efficiency of food donation for the food service industry through acost-neutral modelv Reduce the burden of rescuing food for food banks and food agenciesv Rescue more food to support people struggling with hungerv Divert food from landfills to reduce the environmental strain caused by food waste3 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
H UN G ER , FOOD R ESC UE A N D H OW YOU C A N H ELP4 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Hunger Is a Logistics Issue that You Can Help SolveThese images portray two troubling crises that are closely linked:Food Waste and Food Insecurity5 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Why Food Donation Is Right for Your CompanyFINANCIALLYSELF-SUSTAINING This program has thepotential to fund itselfthrough a U.S. federal taxdeduction enhancement(1)Liability for donationsdonated in good faith areprotected under the GoodSamaritan Act(2)6 Starbucks Food Donation GuideGOOD FORTHE PLANET Food donation can reducegarbage fees and provide asolution to the growingnumber of municipalcomposting lawsFood waste accounts for21% of landfill volume and21% of all fresh water(3)MAKES EMPLOYEESPROUD Allows employees to be partof making positive changeevery day Food Donation ranked 1 oftop 3 positive changesStarbucks employees wantedto see in their workdayEXCITES CUSTOMERS& STRENGTHENSYOUR BRAND 7 in 10 people say it’simportant to buy fromsocially and environmentallyconscious brands(4)(1) ially-Responsible 2021 Starbucks Coffee Company
Backhaul Logistics Tax Benefit Cost-effective Food RescueBackhaulLogisticsDonateFoodBACKHAUL LOGISTICSDONATE FOODUtilizing existing delivery trucks androutes to pickup food donationsand return to a central site forconsolidation unlocks consistentand efficient food rescueInstead of being thrown away, unsoldfood is rescued and donated to theFeeding America network of food banksand agencies to get into the hands ofthose who need it most.Tax BenefitfromDonationsTAX BENEFIT7 Starbucks Food Donation GuidePer the U.S. Enhanced Tax Deduction, companiesreceive a financial benefit for pounds of fooddonated, which can be used to fund backhaullogistics for food rescue. More details and examplecalculation on slide 17. 2021 Starbucks Coffee Company
Starbucks Uses the Tax Benefit to Fund Hunger Relief EffortsStarbucks receives the U.S. federal tax benefit for every pound of food donated and those funds help keepthe program self-funded by covering food rescue logistics costs and investments into food banks andother hunger relief initiatives.Let’s look at an example: 100Tax benefitreceived fromdonationsTax benefit calculation subject to IRSregulations and may differ acrossvarious types of organizations.Consult your tax advisor to understandhow to calculate your tax benefit. 50 50Food RescueLogisticsHunger ReliefInitiativesNOTE: Numbers are for illustrationpurposes only; neither dollaramounts, nor allocation splits arefactual(food bank capacity grants, mobilepantries, cause marketing campaigns, etc.)8 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Feeding America: Your Food Donation PartnerWith a network of over 200 food banks across the U.S, Feeding Americais the strategic partner to ensure that food is rescued from going to thelandfill and instead feeding those impacted by food insecurity.Watch this video to see howFeeding America works ›9 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
R OA D TO PR OG R A M C R EA TION10 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
The Starbucks Food Donation StoryVision: Rescue 100% of food available todonate from all U.S. company-operated stores.HOW WE GOT HEREStarbucks Partners (employees) who live theStarbucks Mission and Values daily in ourstores expressed concern about the food thatwas being thrown away each night.Driven by this concern, Starbucks teamed upwith Feeding America in 2016 to develop theFoodShare program to donate all unsold foodavailable to donate from stores to localFeeding America food banks and agencies.Five years later, we are donating unsoldfood from 100% of our U.S. company-ownedStarbucks stores.As a company deeply concerned with theissue of hunger, we have created this Guide tohumbly share what we’ve learned in hopes togrow food donation in the food serviceindustry so that together we can end hunger.11 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Road to Program CreationENGAGE EXTERNALPARTNERSLEADERSHIPBUY-INFind yourprogramchampion(s)!3PLs, NGOs,Food BanksLogistics,Tax/Finance,Operations, etc.ALIGN INTERNALSTAKEHOLDERS12 Starbucks Food Donation GuideLAUNCH &CELEBRATEFind moreways to impacthunger relief!Get themexcited!TRAINEMPLOYEES 2021 Starbucks Coffee Company
Program Creation Achieving Leadership Buy-In To successfully launch a food donation program,you need a champion who will help driveleadership alignment across the stakeholders whowill support the program. Work with your tax and finance teams to create abusiness case to help your leadership understandthe brand and financial benefits to donating unsoldfood from your organization.13 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Program Creation Align Key Internal StakeholdersTAX & FINANCEEnsure finance has the correct informationto capture the food donation tax benefitavailable in the United StatesQUALITY ASSURANCEQuality and safety testing to determinedonatable goods and shelf-life afterdonation14 Starbucks Food Donation GuideOPERATIONSCreate launch and training guides foremployees executing the programLEGALDevelop contract agreements with nonprofit organizations and 3PL providersTRANSPORTATION/LOGISTICSPartner with transportation to create thedonation logistics model right for your orgSOURCINGSource & distribute the materials needed instores to execute the program 2021 Starbucks Coffee Company
Align Key Internal Stakeholders Tax & FinanceTax benefit example calculation from ReFED.orgUSE THE TAX BENEFIT TO FUNDYOUR PROGRAM BUDGETExample: Build a business case to understand the potential donationvolume Consult your tax advisor to understand the correct taxbenefit calculation for your organizational structure The CARES act may allow you to receive a higher tax benefit Use that tax savings to help cover the costs of this program,which include logistics and some materialsA grocery store donates potatoes with a fair market value of 100. The basis value of these potatoes was 30. The expectedprofit margin is the fair market value minus the basis value( 100- 30), which is 70. Under the enhanced deduction, thegrocery store is eligible to deduct the smaller of:1) Basis Value x 2 30 x 2 60or2) Basis Value (expected profit margin/2) 30 ( 70/2) 65The enhanced deduction would be 60, which is substantiallyhigher than the general deduction (the 30 basis value).KEY STARBUCKS LEARNING:Food banks also have to pay for logistics. Consideroffsetting the food bank’s costs of distributing yourdonations by sharing any excess tax benefit afterpaying for programmatic costs.15 Starbucks Food Donation GuideExample taken from ReFED.org. More details on this calculationand the policy guiding it can be found at ReFED’s icyfinder/federal-policy/federal-tax-incentives 2021 Starbucks Coffee Company
Align Key Internal Stakeholders Quality AssuranceLearn more about food donation regulation in U.S.CHOOSE TO DONATE FOOD THAT IS SAFEAND PROVIDES A DIGNIFIED EXPERIENCEVisit Feeding America’s “Become a partner” webpage to learnmore about the U.S. Bill Emerson Good Samaritan FoodDonation Act.Your Quality Assurance team should assess all productspotentially available for donation: All food donated in good faith is protected by the U.S.Federal Good Samaritan Act Test product shelf-life to understand how long it is goodafter it leaves the store Food should be tested for safety and dignity of recipient;work with your QA team to determine the appropriateshelf-life for donation and distribution The Starbucks QA team selected a food safe bag for fooddonation storageKEY STARBUCKS LEARNING:From food bank interviews, we have found the highestvalue items are protein-based. We have also foundthat they have an overabundance of breads andsweets and do not need more.16 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Align Key Internal Stakeholders OperationsStore materials to support executionMAKE FOOD DONATION PARTOF THE CLOSING PROCESSYour Operations team is key to helping you: Create the right program structure Build training materials Identify resources your employees may need Pilot / Test out your program with employees who will beresponsible for executing your program on a daily basis Simplicity is key: try not to create barriers to existingbusiness processesKEY STARBUCKS LEARNING:Consistent execution by both employees preparingdonations and those picking up donations is keyto success.17 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Align Key Internal Stakeholders Transportation/LogisticsReverse logistics processUSE EXISTING STORE DELIVERY TRUCKSTO BACKHAUL DONATIONS FORCONSOLIDATION AT WAREHOUSE Backhauling donations on existing food delivery trucks mayrequire third-party logistics engagement (see ExternalStakeholder section) Food can be segregated on truck to ensure donated productdoes not mix with product being delivered into storesEmployeepreparesdonationsEmployee placesdonation bags instore fridge3PL picks updonated itemsduring nightlydeliveries3PL consolidatesdonations atwarehouse3PL deliversdonations to foodbank or agencyAgencydistributes toclients strugglingwith hunger Leadership alignment is especially important for this group ifyou have a national programKEY STARBUCKS LEARNING:The reverse logistics food donation backhaul model isthe most consistent and cost-effective donationmodel of the 3 models we have executed. (SeeAppendix slide 27 for model comparison.)18 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Align Key Internal Stakeholders SourcingExample program materialsENGAGE SOURCING TO PURCHASEANY PROGRAM MATERIALS Sticker used to identify fridge where donations are stored Food safe bags to store donations Test whatever food storage solution you identify to ensure itdoes not crush the productKEY STARBUCKS LEARNING:If you use donation bags, it helps if they have handlesfor tying the bag closed. It also helps to print fill linesand allergen statements on the bag.19 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Align Key Internal Stakeholders LegalCREATE LEGAL DOCUMENTS WITHANY EXTERNAL PARTNERSConsiderations: Outline parameters/requirements of relationship (financial,logistical, reporting, food safety, etc.) Include language that prohibits re-sale of food donations Align on marketing strategies Review contracts regularly and negotiate revisions asnecessary Reach out to NGO or transportation partner to see if theyhave an existing contract template that can be utilizedKEY STARBUCKS LEARNING:Legal contracts are a great way to formalize foodsafety requirements as well as document agreedupon logistical details.20 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Program Creation Engage External LocalFoodBanksCommunity & social impactopportunity for 3PLSProgram guidance &relationship buildingFood banks need protein,not sugarUnburdens food banks fromthe logistics of rescuing foodSingle program contractFood banks requirefinancial supportOPPORTUNITY FORBUSINESS EXPANSIONUmbrella reporting for taxSINGLE PROGRAMCONTRACTOrganize employeevolunteer eventsGIVE TO A FOOD BANK —GIVE TO A COMMUNITYFeeding America Relationship21 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Train Employees Employees are Key to Program SuccessFood donation makes employees proud! Get them excited! Employee engagement is key to success. Consider a celebration event atstores when you launch to increase awareness and excitement Starbucks provides FoodShare T-shirts for all partners at stores active onFoodShareRestaurant/store employees will be responsible for executing the programon a consistent basis. Ideally, food donation does not require extensive labor or time, but is asimple part of the employee’s closing routine Employees are primarily responsible for making sure donations areprepared in time for nightly delivery driver in a food safe manner22 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Launch Kick Off Program, Celebrate and Measure Celebrate an amazing program launch! Volunteer as a team at a local food bank Collaborate with local food bank to amplify your program and createawareness for the issue of hunger Track key metrics to find opportunities for efficiency Utilize your Public Affairs team to amplify program in local communitiesand inform local stakeholders Explore how your company can do more to impact hunger relief23 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
A PPEN DIX24 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Food Donation Model ComparisonStarbucks has run three versions of the FoodShare program: internal backhaul and delivery, nighttime pickups by foodbank and daytime pickups by food bank. We have found the backhaul model to be the most efficient and effectiveoverall; however, it does require more internal buy-in.In certain situations, where backhaul logistics cannot take place daily and food shelf-life is a concern, the food bankdaytime pick-up model may be the most effective option.Delivery 3PL Backhaul ModelFood Bank Nighttime Pick UpFood Bank Daytime Pick UpCompanyProgram OwnershipFood BankMoreMeals DonatedLessConsistency/Pick-Up ReliabilityHighTax BenefitEfficiencyLowInternal Buy-In Required25 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Food Bank & Donation ConsiderationsFOOD BANK/AGENCYCONSIDERATIONS Space capacity to accept/store donation volume Temp-controlled storage (if applicable)FOOD DONATIONCONSIDERATIONS Packaged, Ready-to-Eat foodExamples: Unloading ability (dock doors, ability to unload tractortrailer vs box truck, etc.) Packaged salads, sandwiches, etc. Receiving hours/days (including holidays) Produce Reporting ability (BOLs, weighing of donations, etc.) Packaged dairy (jugs of milk, etc.) Nutritious food is preferred Labeling (containing ingredients/allergens) Multi-day shelf-life that will allow for distribution fromfood bank à agencies à clients26 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
DefinitionsStarbucks Partner: Starbucks term for employee.Food Bank: Centralized distribution center (warehouse) for a region’s food donations. Do not typicallyserve individuals directly. Instead, they provide food to the agencies that serve clients.Food Agency: Localized organization providing food directly to individuals struggling with hunger.Meal Program: Typically provides some form of a hot meal service. This could be a “soup kitchen” at achurch, a homeless shelter or a variety of other programs.Meal Pantry: The meal or food pantries provide food items that clients can take and cook at home.This could look like a pre-kitted box or a grocery-store style shopping experience.Third-Party Logistics (3PL): Contracted trucking companies that manage delivery and transportationon a company’s behalf (e.g., Penske, QCD, etc.).27 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
Thank you.28 Starbucks Food Donation Guide 2021 Starbucks Coffee Company
2021 Starbucks Coffee Company 11 Starbucks Food Donation Guide HOW WE GOT HERE Starbucks Partners (employees) who live the Starbucks Mission and Values daily in our stores expressed concern about the food that was being thrown away each night. Driven by this concern, Starbucks teamed up with Feeding America in 2016 to develop the
Starbucks Corporation Fiscal 2007 Corporate Social Responsibility Annual Report 2 SOCIETY 44 Starbucks Community & Growth Impacts 49 Starbucks Community Investments 54 Our Contributions to Communities Around the World 57 The Starbucks Foundation 61 Starbucks Commitment to Health and Wellness 65 Being Responsive to Our Customers 66 Public Policy and Government Affairs
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STARBUCKS CHINA: 'GOLD STANDARD' VISION Since entering the Chinese mainland market more than 20 years ago, food safety has always been a key element in Starbucks' strategy. This is reflected in Starbucks aspiration to achieve a comprehensive 'Gold Standard' for food safety that leads the industry in China. In 2016, Starbucks
4 5. RESPONSIBILITIES Beneficiary or grantee: Submit a written donation request (letter or email). Submit the donation certificate. Receive the donation and use it for the stated purposes. Provide information necessary for assessment of donation request. Bribery: The following person commits the act of bribery: Donation Policy and Procedure
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