This Is How Starbucks Really Makes Its Money

Starbucks is the McDonald's of coffee. Its green mermaid logo can be found around the globe in more than 75 different countries (via Starbucks) and people can't get enough of those unicorn drinks. The chain absolutely rakes in the money and there isn't another mainstream coffee chain that comes close to the popularity of Starbucks. When it comes down to making that cash, Starbucks essentially has three different sources of revenue: coffee shops, convenience stores, and grocery stores (via The Motley Fool). This successful business model pretty much guarantees that people don't have to look too hard to find some Starbucks coffee. 

If somebody doesn't have a Starbucks coffee shop near them, they can grab a bottle of iced coffee at a gas station on their way to buy a bag of it at the grocery store. Most of the company's billions in revenue, though, still come from one main source.  

While Starbucks certainly loves for people to buy its coffee in the grocery store or pick up a can of its Doubleshot Espresso at the gas station, they'd prefer you to visit the coffee shop. The coffee shop is where Starbucks customers can try expensive new coffee concoctions like the Phantom Frappucino and order a muffin, and then plop down in one of their leather chairs before heading back to the counter to grab an extra coffee and pastry for the road. 

Grocery and convenience store sales are nice, but they're only a fraction of the pie as 91 percent of Starbucks' revenue comes from sales made inside Starbucks coffee shops (via Investopedia). And surprise, surprise, coffee and food products are their biggest sellers. According to The Today Show, enticing photos, a chill atmosphere, limited-time drinks, and several drink sizes to choose from all factor into getting your dollars at the coffee shop  

Most of Starbucks' coffee shops are not franchises, but are instead company-owned, and this means that the company keeps the bulk of generated revenue. When you consider just how good Starbucks is at getting its customers to spend their cash in the coffee shop, it's no surprise that they're pulling in a lot of revenue. In 2018, Starbucks made a whopping $4.52 billion in net income (via Statista).