Sales reports show that NMU’s Starbucks is generating similar sales by itself as compared to when the university operated two brick-and-mortar coffee outlets, including Stone Creek Coffee. The university is not interested in opening another coffee outlet, however, despite the fact that the Starbucks contract only limits another coffee shop in Jamrich and not elsewhere on campus.
NMU Vice President for Finance and Administration Gavin Leach defended the university’s decision not to open another Stone Creek Coffee outlet.
“It wasn’t necessary or cost effective to build another retail shop or vending area,” Leach said.
The university’s reasoning for not offering a second coffee shop, however, does not sit well with some students.
Rachel McCaffrey, a senior social work major, said she thinks another coffee outlet seems logical if the amount of generated sales from two outlets is similar.
“Stone Creek gave students options and that’s important,” McCaffrey said.
McCaffrey also pointed out the space in the basement of the library where the old Starbucks was previously located as having potential for another coffee option.
Years ago, ASNMU campaigned to use that space as a study area for students that also contained the original Starbucks outlet, rather than having it used as storage for the library.
“ASNMU fought for the space for the coffee area and now I think that space is being neglected,” McCaffrey said. “They could easily put something else in there.”
Using the Michigan Freedom of Information Act (FOIA), The North Wind requested copies of Starbucks and Stone Creek monthly sales reports from 2004 to 2014.
In September 2014 Starbucks grossed $77,203 and in October, $71,334, not factoring in required fees. In September 2013, Starbucks and Stone Creek together grossed $72,009 and in October 2013 they grossed a combined $67,142.
Since the Stone Creek location has closed, the university’s Starbucks franchise has had a significant increase in sales each month. This increase may be attributed to the fact that it is the only coffee specific outlet on campus.
It is important to note Stone Creek’s black coffee price is less expensive than the smallest size of black coffee at Starbucks. The only size coffee available, a 12-ounce cup, to order from a campus dining service that serves Stone Creek is $1.75.
The same size from Starbucks is $1.85. A 16 ounce cup of coffee from Starbucks is $2.20 and a 24 ounce cup is $2.45.
Senior environmental studies and sustainability major Dylan Weissenborn saw both sides of the issue. He said he understands, from a business mindset, why NMU may have chosen to only maintain one coffee outlet.
“This is just another instance of a rarely seen entity of Northern making decisions without the students’ input, which I guess is fine,” Weissenborn said. “The university doesn’t have to involve students on every single matter. People tend to forget that the university is, in the end, a business. It’s about money.”
Weissenborn said he was more concerned about the lengthy process that ensued to find the information.
NMU took nearly a month to respond to a FOIA request for Starbucks contracts, missing an extension, which in effect was a denial of the records.
“The troubling part about this situation is how it took some investigating to find it out,” Weissenborn said. “I’m more upset about the lack of transparency than not being able to guzzle my preferred brand of java.”
Since NMU entered into the original Starbucks contract in 2003, the university has generated $3,674,093 in gross sales from the coffee franchise, according to sales figures provided by the university. Stone Creek has generated $241,063 in gross sales since the university entered into the contract with the coffee brand in 2010.
Leach said the profits generated from both Starbucks and Stone Creek are used primarily to pay for student jobs. He said any additional funds, beyond operational costs, are placed in a reserve account to allow Auxiliary Services to pay to replace equipment and upgrade facilities. Any leftover funds at that point contribute to student scholarships to sponsor 10 to 12 students per year.
Leach defended the university’s decision not to establish another Stone Creek coffee shop. The administration has been adamant that the university has four outlets for Stone Creek coffee: Fiera’s, Melted, Café Libri and Temaki and Tea, and does not need another.
The Starbucks franchise location had previously seen steady growth in sales each year, except fiscal year 2009, until the brick-and-mortar Stone Creek location space was officially created at NMU in the fiscal year of 2011. After this installation, Starbucks saw a less consistent period of growth, even suffering two years of decline as Stone Creek sales continued to increase each year.
Stone Creek sales more than doubled the first year after the brick-and-mortar space was created and had another large jump from fiscal year 2013 to fiscal year 2014, the last year the space was in operation.
Some students and faculty have complained that the university has favored Starbucks in order to curry favor with NMU alumnus Howard Schultz, the CEO of Starbucks, in hopes that the coffee czar will donate to the university, but Leach denied such a motive.
“While Northern takes pride in all of its alumni accomplishments, including those by Mr. Schultz, the goal of NMU having Starbucks on campus was to benefit students and the NMU campus community,” Leach said.
Meg Nelson, a senior illustration major, said she thought the location for the original Stone Creek outlet wasn’t ideal for the best business, however, she felt it had a strong enough following to continue.
“I know that many students appreciated Stone Creek as an anti-corporation option on campus,” Nelson said. “I think it would have been way more successful if housed in an appropriate location, instead of a cramped old classroom.”
Rachel Benedict, a sophomore criminal justice major, questioned the move of Starbucks to the new Jamrich building as well.
“I don’t see why they didn’t stay there and move Stone Creek to the new Jamrich building,” Benedict said. “I think that just having Starbucks on campus is fine, however, I am a coffee addict and would love another coffee outlet option on campus if it is ever possible.”
