Starbucks CEO Howard Schultz has ambitious growth plans for the Chinese market.
Starbucks is planning to open 500 new stores a year in China over the next five years, with a goal of operating at least 3,400 stores there by 2019.
During a visit to China, Starbucks CEO Howard Schultz announced the planned roll out of new stores in China and said: “As Starbucks’ second largest and fastest-growing market globally, China represents the most important and exciting opportunity ahead of us.”
In a statement, Starbucks said: “We are deeply humbled by the enthusiasm with which Chinese people have embraced Starbucks as part of their daily ritual over the past 17 years. Over time, it’s conceivable that China could become our largest market.”
Starbucks already has more than 2,000 locations in nearly 100 cities in China. The company has been in Hong Kong for 15 years and the Starbucks Central and Western region is one of the fastest growing regions in China, having tripled its store footprint there over the past three years.
Same-store global sales beat analysts’ expectations last year, but same-store sales growth in the China and Asia Pacific region in the fourth quarter came in at 6%, behind analysts’ estimates of 9.6% growth for that segment.
Still, coffee consumption in China is 4.5bn cups a year, or a blip compared to the 133.9bn cups a year drunk by North Americans. according to data from Euromonitor International, which the Wall Street Journal cites.
During his visit to China, Schultz also announced that full-time baristas and shift supervisors in Starbucks company-owned stores throughout China will begin receiving monthly housing subsidies that will, on average, cover 50% of their monthly housing expenditures. Starbucks said it hopes the benefit will allow its China employees to overcome the initial financial challenges of staring their careers while living independently.
Belinda Wong, president of Starbucks China, said the employee benefits offered “demonstrate our continued commitment to support our China partners to achieve their personal and professional aspirations.”
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