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1、StarbucksCpationFiscal2008AnnualRept5204c1.indd1113092:51:13PMDearShareholdersWhenwebrought10000partnerstogetherinNewleanslastOctoberStarbuckswasatacrossroads.Wehadjustcompletedaverydifficultfiscal2008after16yearsofconti

2、nuousgrowthasapubliccompanywewerefthefirsttimetalkingaboutslowinggrowthsteclosurescostreductions.ConsumerconfidencewasapproachingalltimelowsbothWallStreetMainStreetwerereeling.Inthefaceofthesechallengeswemadewhatmanybeli

3、evedtobeacontroversialdecisiontoinvestinourpeople.Fmethedecisionwasobvious.Theceofourbrofoursuccessfmethanthreedecadeshasbeenourpartners.OurfuturegrowthdependsonthemonstayingtruetothevaluesthatmadeStarbucksthewldclassbri

4、tistoday.AtourLeadershipConferenceweaskedourpartnerstomakeacommitmenttodoingbusinessinanewway.(WhatyouseeonthecoverofthisreptistheCommitmentWall—which10000partnersfromalloverNthAmericasigned.)Weaskedthemtooperatetheirste

5、sasiftheyweretheirownbusinessestodeliveranexperiencethatwouldengageourcustomerstogetinvolvedwiththeircommunitiesasneverbefe.Wealsointroducedthemtonewtoolstechnologyweknewtheyneededtomeettheseobjectives.Mostimptantwereene

6、rgizedourpartnerssentthembacktotheirstestodeliverresults.OurstepartnersarenowbetterequippedtooperateinadifferentenvironmentwitharenewedfocusonwhathasdefinedStarbucksfalltheseyears:ourcoffeeourcustomersourstesthecommuniti

7、esweserve.Starbuckstooisreadyftherealitiesoftoday’sdifficultbusinessenvironmentwitharelentlessfocusonremainingtruetowhoweareonourresponsibilitytoshareholders.Whiletheyearpresentedus—alongwithmostotherretailers—withsignif

8、icantchallengesitalsogaveusthebestevidenceyetthattheStarbucksbrremainsrelevantpowerfulthatourcustomersremainloyalinvestedinoursuccess.InspiteoftheeconomyasIwritethisStarbucksbusinessfundamentalsarestrong:wehavemethan1600

9、00partnerswhohleapproximately50milliontransactionseveryweekinournearly17000stesin49countries.Wegeneratestrongcashflowhavesolidliquidityweareexecutingrigouscostcontainmentinitiativestoimproveourbottomline.Wehaveadifferent

10、iateddiversifiedrevenuemixincludingconsumerpackagedgoods(CPG)foodservicelicensedstesbusinessesaswellastheSeattle’sBestCoffeebr.OurprofitableCPGbusinessisexpinginternationallythereadytodrinkpieceofthatbusinessissteadilyga

11、iningmarketsharearoundthewld.CustomerspurchasednearlyhalfamillionStarbucksGoldCardsmethan5millionStarbucksCardsatCostcoduringtheholidayseason.TheyhaveloadedarecdnumberofdollarsontheirtraditionalStarbucksCardsweexpecttose

12、etheresultsofthisthroughoutfiscal2009.AllofthisgivesmeconfidencethatStarbucks—unlikemanyotherretailers—haswhatittakestoendureasavitalpartofthefabricofeverycommunityneighbhoodwherewedobusiness.Infiscal2008weinvestedintheS

13、tarbucksExperiencewhatweknowourcustomersarelookingfwhentheyvisitourstes.Weputasignificantemphasisoncoffee—startingwiththelaunchofPikePlace?Roastourneweverydaybrewedcoffee.ThisemphasisincludedtheintroductionoftheStarbucks

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