Starbucks wants 9,000 stores in China by 2025

September 16, 2022

Abstract : The US multinational coffee company plans to increase the number of stores in China by 50% over the next three years, despite declining sales due to lockdowns. The country remains the largest market outside the US and is growing fast

MILAN, Sep 15 (Class Editori) — Starbucks, the American multinational coffee company, plans to increase the number of stores in China by 50% over the next three years, a vote of confidence in its largest market outside the US, despite lockdowns against Covid-19 and weaker consumer spending that has slowed sales.

Starbucks set a goal of 9,000 stores in China by 2025 in a meeting with investors during which executives outlined a wide-ranging revamp. The company previously said it would operate 6,000 stores in China by the end of this year.

The company also stated it expects sales in China to nearly double in the next three years, adding that it estimates to experience huge growth in same-store sales starting in fiscal year 2023 after this year's slump.

The company’s optimism about the Chinese market comes despite a brutal year for consumer-facing businesses. Last month, the Seattle-based chain said its same-store sales in China fell by 44% during the quarter ended July 3 compared with the previous year, compared to a 3% increase in same-store sales worldwide. The decline marked an acceleration from a 23% drop in Chinese same-store sales during the company’s previous quarter.

Starbucks executives have expressed their optimism on the fact that recession caused by Covid-19 will be temporary, adding that they expect an increase next year as sales bounce back from the depression of 2022.

“Coffee is emerging as the beverage of choice for the young consumers in China and we are positioned to gain share,” CEO ad interim Howard Schultz said on Tuesday. “We are investing now for the long-term growth aspects of the country”.

Starbucks stated that the Chinese coffee market is still at its early stages with more growth margin. The average Chinese consumer drinks 10 to 12 cups of coffee a year, compared to the less than 3 cups of 2014, Schultz said. Starbucks generated 13% of its 2021 revenue in China, making the country its largest market outside the US.

(Source:Class Editori)

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