DEPENDING on your ideological tilt – and, really, how much you like coffee – it was either an assault on decency or the most brilliant decision Howard Schultz ever made.

In early 1991, a few years after he had scraped together the money to buy a fledg-ling Seattle coffee company called Starbucks, Schultz’s most profitable café was at a city-centre crossroads in Vancouver, across the border in Canada.

It occupied a dilapidated space and had almost no room for patrons to sit down. Yet it was a living testament to the world’s sudden, intense and puzzling thirst for expensive coffee drinks. This tiny Starbucks served 10,000 people each week – and those were just the ones who could get in. The café was turning away hundreds every day.

Schultz, a young and ambitious former housewares salesman who grew up broke in Brooklyn, was not one to take lost customers lightly. For quite a while he had been mulling over an idea that had never been attempted before. He would open another Starbucks just across the street – only 15 metres away – something any sensible businessman would have called outright crazy.

The truly mind-boggling part is this: instead of laughing Starbucks out of town, customers flocked to the new café. Schultz expected the two outlets to eat away at each other’s sales, but they attracted different crowds. The new café lured the business set while the original drew a hipper clientele. And both groups turned up in droves.

Schultz had hit the jackpot. He had seen what nobody else had spotted: that each corner of that crossroads had its own unique flow of pedestrians. He could bring in thousands of new customers by making his new store just a few steps more convenient.

As Art Wahl, an early property broker for Starbucks, put it: “After that, we said: ‘Oh my God . . . we can put these things closer together than we ever imagined.’ ” Starbucks didn’t invent coffee, of course; it just did something with it that nobody else had. The company took a commodity that Americans could get for 25 cents at stalls and diners, reshaped it into a luxury product, convinced customers to buy it at hugely inflated prices, and built outlets only a few blocks apart in every big city. Yet patrons continue to line up in ever-greater numbers to hand over their money.

With $7.8 billion (£4 billion) in annual revenues, 40m customers and 13,000 outlets, Starbucks now owns its market like few other companies in recent memory.

Given the chain’s breakneck international expansion and ability to reshape coffee-drinking habits the world over, it is a global institution. It’s no stretch to say it has changed the modern world. Starbucks influences traffic patterns on the roads, affects the welfare of 25m coffee farmers, and sways the cultural customs of entire nations.

All around the globe – both in countries with their own centuries-old café culture and in those where coffee-drinking was virtually nonexistent 20 years ago, the coffeehouse template pioneered by Starbucks is becoming dominant and pervasive.

The Starbucks foray into global coffee domination began in the late 1990s, with its swift occupation of two of the world’s preeminent tea-drinking countries, Japan and Britain. The two cases illustrate very different sides of the debate over the company’s corporate colonialism.

In 1996, Starbucks unveiled its first Japanese outlet, in Tokyo’s Ginza district, with a performance that would have made any Broadway producer proud. At the opening ceremony, Shinto priests blessed the new store and prayed for harmony between Starbucks and the forces of nature, while Schultz and other executives sipped sake and washed their hands in spring water. When Schultz and Howard Behar, the Starbucks president, saw a line of 100 excited Japanese coffee fanatics waiting for their first taste of Starbucks, they cried.

From that moment on, Starbucks enjoyed huge success in Japan; astoundingly, its Japanese stores (there are now more than 600) became twice as profitable as its already lucrative American outlets. The lines at the cafés were endless, and customers greeted each new Starbucks with elation. A bit of serendipity may have helped: according to Japanese fable, anyone who eats the flesh of a mermaid – the Starbucks symbol – gains eternal life.

Japanese consumers have long adored American brands, but the company’s success there was far from preordained. In fact, when Starbucks was still mulling its Japanese debut, a consulting firm advised against it. Although the Japanese were already drinking impressive quantities of coffee by the mid1990s – both from the cramped kis-saten shops that had long dotted the urban landscape and from the pervasive vending machines – the consultants believed Starbucks would clash with social norms. The chain’s no-smoking rule would alienate young people, they thought, and the etiquette-obsessed Japanese would never be seen drinking coffee in public.

Despite this, Starbucks made just a few, slight changes to its formula, such as concocting a green tea frappuccino, and offering smaller drinks and pastries to conform with local preferences. Then it began the deluge of outlets. And here’s the crucial part: the Japanese bent over backwards to accommodate Starbucks, not the other way round. The company still opens more than 100 stores a year there.

If the Japanese welcomed Starbucks with enthusiasm, the British greeted it with something like paranoid shock. In the spring of 1998, more than 60 Starbucks cafés appeared in Britain, pretty much without warning.

This was the company’s idea of “breaking through the noise”: it acquired a 65-store chain called Seattle Coffee Company and immediately converted its locations into Starbucks stores.

In a way, the takeover was fitting. Seattle Coffee Company was founded in 1995 by Scott and Ally Svenson, an expatriate Seattle couple who had first opened a café mostly to relieve their longing for the espresso concoctions of their home town.

“You wouldn’t believe all the things you had to go through to get any kind of decent coffee in London,” said Scott. “At the time, about 96% of all coffee consumed in the UK was instant coffee. It was so bad that my wife actually called Howard Behar [the Starbucks president] and said, ‘We live here, the coffee is terrible, and you should do something about it.’ He said, ‘Listen, we get calls like this all the time. We’ll get there eventually.’ ” The Svensons couldn’t wait any longer; they soon started their own coffee bar, intending to run it as a hobby. Sales rocketed, however, and the Svensons kept expanding their business until Starbucks realised it had to buy them out or risk losing the British market. THE sudden appearance of these 65 Starbucks cafés alarmed many Britons, and the sentiment only intensified as the company inundated the country with outlets. London – which, in 1998, had no coffee culture to speak of – zipped past the 200-Starbucks mark in just seven years, and it now has more stores than New York.

This invasion didn’t do wonders for the company’s public relations or sales. Between 1998 and 2002, Starbucks lost £50m in Britain, because of a mixture of consumer resistance and naivete about the London property market.

“I don’t want to give too many of my own impressions on Starbucks’s public image in Britain because obviously I have some conflicts,” said Scott, who briefly took an executive position with Starbucks after the sale. “They probably rushed too quickly in establishing a presence. They weren’t localised enough. When you grow like that, I think you lose . . . things.”

Edward Bramah epitomises the typical old-fashioned Londoner who has become angry about the arrival of these “things” in his city. A tall, bushy-eyebrowed veteran of the tea and coffee industries, Bramah is the founder, head tour guide, author-in-resi-dence, receptionist, and occasional disgruntled barista at the Bramah Museum of Tea and Coffee near Tower Bridge.

Bramah is a passionate authority on the traditional coffee-drinking methods of antiquity. “Coffee is a superb drink,” he said. “I cannot begin to tell you how one can wax lyrical about the delectable delights of delicious coffee.”

His museum bursts with caffeinated arcana: Portuguese gas-heated brass urns, hydrostatic percolators, bulbous glass vacuum pots, silver-plated Victorian-era siphoning systems, egg-shaped reversible drip pots, brewing contraptions designed to look like locomotives. When Bramah’s eye falls on his exhibits of early espresso machines, though, his demeanour sours. “The coffee served in these new cafés isn’t coffee,” he spits. “All that bloody milk. These people know damn well they’re selling milk.”

Of course, Bramah may just be resistant to change – there’s a fine line between preserving traditions and clinging to a romanticised past. But he has good reason to worry that espresso will overrun the customs of old.

Despite its early image as ruthless corporate conquistador, Starbucks has sparked a huge shift in British tastes. Over the past five years, UK tea sales have plunged while coffee sales have soared, which has brought about a stunning result: Britons now spend more on coffee each year (£738m) than they spend on tea (£623m).

Particularly in London, coffee houses have reached saturation point – one can’t walk 10 blocks on a commercial street without passing two or three Starbucks outlets, plus a handful of its main competitors, Caffè Nero, Costa Coffee and Coffee Republic.

The tea industry has attempted to regain ground lost to espresso machines with contraptions such as Lipton’s T-bird, but to little effect.

With the help of a charm campaign – and more than 500 UK cafés – Starbucks is overcoming local resistance and establishing a firm grip on the wallets of Britain’s prolifer-ating coffee drinkers.

The moral of these two stories is this: in Japan and Britain, the initial receptions were different, but the ultimate result was the same. Typically, Starbucks comes in, ignoring any local outcry, and people eventually disregard their reservations and start patronising the chain.

Sometimes the company fundamentally alters its operations for a new market – as it did in Saudi Arabia, where all stores are segregated into “men-only” and “family” sections – in accordance with the country’s rigid separation of the sexes in public.

After a warning from the Saudi religious police, the Muttawa, Starbucks also removed the scandalous, bare-breasted mermaid from its logo and replaced her with a simple crown. The Muttawa later had a change of heart, and the company reinstated the original logo.

Mostly, however, the changes are minor. The company can get away with this for a reason that might upset opponents of globali-sation: international customers crave the full American Starbucks treatment, caramel syrup and all.

“The local consumer in all these countries wants the ‘authentic’ Starbucks experience,” said Schultz. “They don’t want it watered down for Mexico or watered down for China. They want Starbucks.”

Plus, international customers often take a liking to Starbucks for the very same reasons Americans did. In Mexico City, Starbucks stores attract the young, the beautiful and the affluent. Consumers in Jakarta proclaim their pride in being able to drink the same cup of coffee as the country’s wealthiest people, even though a frappuccino costs more there than the average Indonesian factory worker earns in a day. Kuwaitis like the dating scene, especially since the sexes almost never get to intermingle in public otherwise.

The Starbucks coffee concept has even taken off in war-torn Afghanistan, where a knock-off “Starbucks” in Kandahar is a community hub and a financial success, selling 500 cups of coffee a day. And fittingly, there’s another faux Starbucks in the US Air Force base in Bagram, where a California National Guardsman set one up inside a metal shipping container to boost troop morale. After all, it’s tough to find a good latte in the high desert of Afghanistan.

The French appear to be embracing Starbucks even as they make a show of despising it. Starbucks made its French debut in January 2004, near the peak of American-French tension over the Iraq war. Schultz tried to reduce the friction by portraying his company as a bridge between the two nations, announcing that Starbucks had come “to share our interpretation of coffee”.

“When we opened in Paris, the editorial coverage leading up to the opening was brutal,” he said. “But people were lined up from day one. CNN covered it live. We’ve never looked back in Paris.” Starbucks has since blanketed Paris with cafés.

When I pointed out to Schultz that his best customers in Paris were predominantly young, he responded: “Young people, but French people.” That is to say, who cares what the older people are doing? The future of France is going to Starbucks. IN coming years, this story of clashing cultures will become a familiar one as Starbucks expands its global presence. Schultz wants to hit a total of 40,000 outlets, and with the American market moving closer to saturation, most of that growth will happen abroad.

Already, you can find the chain in 37 countries, including unexpected places like Oman, Qatar, Chile and Cyprus. Seoul, South Korea, is home to a 200-seat café that spans five full storeys – the largest Starbucks in the world.

Many of these places have no coffee-drinking tradition whatsoever, yet they take to Starbucks as a status symbol or merely as a place to hang out. Often, it’s a simple matter of convenience. For instance, Starbucks has obvious appeal to the French: in a conventional Parisian café, one cannot get coffee (a) to take away, (b) in under 20 minutes, or (c)

for less than £3. I realise how perverse it is to think of Starbucks coffee as a bargain, but such is the magic of Paris.

And, according to Schultz, Starbucks “will soon come full circle, colonising Italy”, the country where he first received his vision for the company on a visit a quarter of a century ago.

What are we to think of this aggressive expansion of the Starbucks empire? Should we chafe at the very idea of the company selling its Americanised drinks to the the gastronomically obsessed Italians?

Equally, many of us may feel a sense of revulsion at the thought of Starbucks in a place like Paris; the fear is that the company will displace the city’s centuries-old pavement cafés and its leisurely croissant-and-cof-fee breakfasts – the very traditions that make Paris charming and unique.

Just as McDonald’s has transformed eating habits around the world by offering quick, cheap and unhealthy meals, Starbucks tends to make permanent cultural alterations as well.

“I was just in Vienna, and there were people all over carrying Starbucks cups on the street,” said Michael Coles, chief executive of Caribou Coffee, Starbucks’s main (but much smaller) American rival. “Before Starbucks arrived, people didn’t carry round food or drinks in public – it just wasn’t done. But Starbucks changed that.”

Certainly, concerns about cultural imperialism will never stop Starbucks from placing stores wherever there’s money to be made. At the 2006 shareholders’ meeting, Schultz placated one rabid investor who thought Starbucks ought to expand faster than it alreadv is by telling him: “There are going to be very few countries in the course of time that we are not going to be in. Be patient.”

It’s safe to say that this notion provides comfort to far fewer people than Schultz thinks. Yet everyone who goes to Starbucks is implicitly sponsoring his globe-spanning vision; we cluck our tongues at a new Starbucks in Paris, yet we fund its construction with our mochas and cappuccinos.

GLARING OMISSION

WHICH of the following places does not have a Starbucks? A: Guantanamo Bay naval base B: A Christian church in Muncie, Indiana C: Beirut, Lebanon D: The town of Starbuck, Washington state E: The Great Wall of China

The correct answer is, of course, D. The tiny town of Starbuck, in Washington state, is 40 miles from the nearest Starbucks, though hundreds of tourists pop in each year and are shocked to learn that Starbuck is not the company’s ancestral home.

© Taylor Clark 2008 Extracted from Starbucked: A Double Tall Tale of Caffeine, Commerce & Culture, to be published by Sceptre on February 21 at £12.99 (available from The Sunday Times BooksFirst for £11.69, including post, on 0870 1658585) Book review, see Culture section

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