The world biggest coffee chain, Starbucks Corp, plans to increase its network in China to 3,400 stores over the next five years, which could pose challenges for small, independent coffee stores, industry sources said. The United States-based coffee chain said on Dec 4 at an investors’ meeting at its headquarters that its operations in China and the Asia-Pacific region represent “enormous, immediate and high-value opportunities” for the company…Full Article: China Daily Dec 2014

Key Points

  • According to the President of Starbucks China, as of December 2014, the company had 1,400 shops located across 84 cities.
  • In 2013, Starbucks China opened an additional 317 shops.
  • Other major coffee chains in China include the UK-based Costa Coffee and the South Korean Twosome or Coffee Bene.
  • According to the China Fruit Marketing Association, China consumes an average of four cups of coffee per year, with the cities of Beijing and Shanghai averaging 20 cups per year.
  • According to the Mintel (market research firm), by 2019, China’s coffee market with reach approximately US$14.16 billion.

ChinaAg Comments

  • In January 2013, Starbucks China announced plans to have 1,500 shops by 2015.
  • In November 2012, Starbucks China raised the prices (by CNY 2 or ~US$0.30) of five espresso drinks in 12 cities.
  • In early 2012, Starbucks China raised the prices of espresso coffee, brewed coffee and hot chocolate by approximately CNY 1-3 (average of US$0.30).
  • In 2007, Starbucks began purchasing coffee beans from Yunnan Province, southern China.
  • Coffee production in China is focused on Yunnan province, which accounted for 90% of China’s output in 2012. In 2009, Guangdong province halted coffee production, while Hainan Island produces ~440 MTs annually.

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