Good Work for All: How Starbucks found a simple way to help staff with housing costs

Coffee retailer Starbucks stores primarily operate in large cities where they found their employees were struggling with high living costs. To help address this Starbucks launched its Home Sweet Loan. The benefits for Starbucks talent is beginning to emerge with an increased retention rate for those who have taken up the loan.

Starbucks is a global coffee retailer with over 900 stores across the UK, and it directly employs in the region of 5,500 partners (its term for employees) across the UK.  It is estimated that around 2,500 of these partners are employed in Greater London and that 50% under the age of 25.

All employees are paid at least the National Living Wage, as Starbucks made the decision to extend this wage to those under the age of 25, going beyond the Government’s minimum requirements
In the UK, the business looked for relevant ways to support staff with living costs, knowing that it’s these extra packages of support that help to attract talent and enable the business to retain its partners.

The idea
To understand how it can make an added impact, Starbucks regularly consults with partners through its employee survey ‘Partner voice’. In 2015, this survey showed that because many of Starbucks stores operate in large cities, partners were struggling with high living costs. At the same time, the business was looking to address turnover rates. Responding to these two challenges, Starbucks began to explore options to help partners manage their living costs.

This idea was then tested out at a focus group, which brings together partner representatives and leadership team colleagues to share and shape new ideas for the business. With resounding support from partners, Starbucks launched its Home Sweet Loan initiative in May 2016, becoming the first private sector company to launch a rental deposit scheme.

How the loan works
Home Sweet Loan offers an interest-free loan to Starbucks partners working in company-owned stores who have been with the business for six months or more, to help contribute to the costs of a rental deposit when moving home, or sub-letting a room.
Starbucks wanted to ensure that applying for the loan was as straightforward as possible, and therefore partners apply using a short form, either online or at their store. The loan covers a maximum amount of one month’s wages, paid within five working days of application, to be repaid over twelve months
Lessons learned
Starbucks always wanted to evolve and enhance the scheme and after a first-year review decided to open it up to those partners on a reduced tenure (previously set at 12 months and now reduced to 6 months) and those looking to sub-let rather that rent directly themselves from a landlord.

Communicating Home Sweet Loans was something that Starbucks considers to be one of the most important factors to the success of the programme, and ensuring that support and information was available everywhere from store managers to district managers to the support centre meant the application process was as easy as possible.

Improving retention
As the scheme continues to grow, the benefits for Starbucks talent is already beginning to emerge with an increased retention rate for those who have taken up the loan.
Top tip for other businesses
Starbucks senior manager, Russell Butcher, who led on the implementation of the initiative, explains that learning from others and making improvements has been key to the success of Home Sweet Loan.
“We don’t think every business should have to reinvent the wheel. We’ve researched, we’ve trialled things, and we’ve made changes. In its essence, the scheme is very simple, which means it is replicable but we have learned lessons about what works best, and we are very happy to help other businesses by sharing these best practices.”
Russell Butcher, Starbucks Senior Manager


Impacting lives
Starbucks acknowledges that moving home can be stressful and that finding an upfront cost for a rental deposit can be an extra burden and stress for their partners. They are committed to supporting partners in a key moment of their lives, and the impact of the scheme is already clear to see in the lives of employees.