When you say to people Starbucks what comes to their mind is a coffee chain brand, but it won’t cross many people’s mind that Starbucks is also a bank in disguise.

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How does Starbucks have so much cash at their disposal?

• The Starbucks loyalty card is the way that Starbucks are able to accumulate so much cash on their balance sheet.
• Starbucks customers in 2021 had $3 billion on their loyalty cards, most of this money customers won’t spend all of their money at once.
• Customers top up their loyalty cards in months in advance so allows Starbucks to invest that cash in the business and make a return before the customers use that money.

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What can we learn? And how can we apply this to our business?

• A loyalty programme is a great way to ensure customers are buying from you. It makes customers feel part of the business and feel as though they are getting something special from being part of the scheme.
• Examples of loyalty schemes are: point based programme, Tier based loyalty programme (customers progress through different tiers and have access to different benefits) and many other.
• What we can learn from Starbuck’s success story is that by encouraging customers to top up on their loyalty card (by for example, giving them special rewards if they pay using the card) will allow you as a business to have sufficient amount of cash at your disposal.

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