Ever since the start of the Israel-Gaza war in October 2023, many online and offline activists who sympathise with the Palestinian cause have been urging consumers to boycott brands and certain products that have shown a pro-Israeli stance. These include many popular brands like Coca-Cola, Mcdonalds and Starbucks.
This boycott has been linked to the BDS movement, which means Boycott Divestment and Sanctions. This movement aims to convince people to boycott certain brands that have heavily invested in Israel or have shown support for the Israeli cause. It also encourages the brands to stop investing in Israel until they give equal rights to Palestinians and end the occupation.
However, this boycott is not part of the BDS movement, which many think, and is rather a personal choice. Many people have difficulty making this choice and wonder whether they should boycott Starbucks or not. Well, today, we will explain in detail whether we should boycott Starbucks and what to consider when making this decision.
What is the BDS Movement?
For nearly two decades, the BDS movement has been advocating for the boycott of Israeli and international companies that they believe are complicit in the violation of Palestinian rights. A primary objective of BDS has been to put pressure on certain companies and brands to cease investment in Israel and to discontinue operations in the Israeli-occupied West Bank.
The movement focuses on a selected few companies that have heavy investments to make a real and significant impact. The BDS movement also calls on its followers and activists to boycott these companies so they can realise their demands and end their operations/investments in Israel.
The movement has made a significant impact. Many companies, like Veolia, have ended their operations in Israel after being inspired by the movement. Academic institutions, including student bodies at prominent universities, have passed resolutions urging divestment from companies profiting from the occupation.
Organisers of the movement claim that it was inspired by the anti-apartheid movement in South Africa, where boycotts and sanctions resulted in the eventual collapse of apartheid.
BDS supporters hope that similar pressure will be exerted on Israel to ensure that it adheres to international law and ensures the rights of Palestinians. The BDS movement is a powerful tool for people of conscience to express their solidarity with the Palestinian human rights movement.
Why Are Activists Calling for the Boycott of Starbucks?
Since the start of the Israel-Gaza war in 2023, activists have worldwide started calling for the boycott of certain brands that are pro-Israeli or have shown sympathy for Israel. Starbucks, one of the biggest multinational coffeehouse brands, is one of them.
However, keep in mind that this boycott is not officially part of the BDS movement. Starbucks's current boycott is primarily motivated by its lawsuit against its employee union Starbucks Workers United.
Starbucks Worker United made a tweet in solidarity with Palestine when the Israel-Gaza war started in October 2023. Alongside the tweet was an image of a bulldozer tearing through the Gaza’s border fence. Starbucks later sued the Starbucks Workers' United claiming that the union had shown "support for violence perpetrated by Hamas" and that it was necessary to protect its name and logo from unauthorised use.
This union responded by accusing Starbucks of exploiting the ongoing events in Gaza and Israel in order to further their anti-union campaign through false attacks on the union's reputation among workers and the general public.
Due to its mistreatment of the union, Starbucks has been widely perceived to be retaliating against its support for Palestine, and therefore, many have decided to boycott Starbucks.
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Does Starbucks Support Israel?
No, despite some purported claims, Starbucks has never supported Israel, provided any financial aid to IDF (Israeli Defence Forces) or has any stores operating on occupied Palestinian territories (West Bank, Gaza) like Coca-Cola. In fact, Starbucks hasn’t had an operating store in Israel since 2003.
The company's official website states that it decided to dissolve its partnership in Israel in 2003 due to the continuing operational challenges it was experiencing in that country.
However, there are a couple of ways that spending money at Starbucks could potentially provide indirect financial support to Israel. First, the company’s former CEO, Howard Shultz, is a staunch Israeli supporter and currently holds a 3% stake in the company. Back in the 2000s, when he was CEO of Starbucks, he tried expanding the stores in Israel but failed.
As CEO in 1998, Shultz was awarded the “Israel 50th Anniversary Friend of Zion Tribute Award" by the Jerusalem Fund of Aish HaTorah in recognition of his contributions to building a close US-Israeli alliance. In 2021, Shultz invested a whopping $1.7 billion in the Israeli cyber-security company Wiz as part of his support of Israel.
Additionally, the Vanguard Group holds approximately $107.9 million shares of Starbucks (9.5%), and this group is also the largest shareholder in Elbit Systems, the largest Israeli weapons manufacturer.
By looking at these facts, we can say that the profits generated by Starbucks indirectly support Israel and its military, which have been genociding Palestinians in Gaza since 2023. However, Starbucks does not directly support Israel, and its current leadership has not made any statement on this matter. The support comes from its investors and stakeholders, who are mostly pro-Israeli.
Former Starbucks' CEO at the time of conflict, Laxman Narasimhan stated that false information spread online about Starbucks' positions concerning the Israel-Hamas conflict misled people into protesting the company and disrupting its stores.
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What is the Impact of the Boycott on Starbucks Sales?
The boycott has had a major effect on Starbucks's sales and overall revenue. With lower sales and a declining share price at the end of 2023 and the beginning of 2024, Starbucks was forced to fire over 2,000 employees in its Middle East stores, including Saudi Arabia, Turkey, and the United Arab Emirates.
Starbucks CEO Laxman Narasimhan stated boycotts played a significant role in this poor performance, explaining that the company saw a negative impact on its Middle East business and that events in the Middle East also had an impact on its position in the United States, resulting in misperceptions.
Further, Starbucks had to close more than 50 stores in Malaysia and Morocco due to poor sales amid the boycott calls. Berjaya Food, which operates Starbucks in Malaysia under its name, stated a significant “decline in revenue and pre-tax losses experienced in the current quarter, primarily because of the result of the conflict in the Middle East.”
According to reports, Berjaya Food reported a net loss of RM38.2 million ($8.6 million) for the three months ending in June, with sales declining by more than half and $20.5 million in net losses for the year.
Conclusion
Boycotting Starbucks and similar companies is more than just a personal choice; it is a meaningful act of solidarity with Palestinians and a powerful way to amplify the call for justice and peace.
By choosing to support ethical alternatives, we send a clear message of unity. Collective action can drive change and raise awareness about the struggles faced by the Palestinian people. Each small decision contributes to a larger movement, fostering hope and resilience in the pursuit of freedom and dignity for all.
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