Starbucks taps China growth

28 November 2012

BEIJING: Starbucks, the coffee house giant, believes China will become its second largest market by 2014, and is enhancing its store network, product range and talent management to aid this process.

The company currently boasts over 700 branches throughout mainland China, and has set the target of running at least 1,500 stores in more than 70 cities across the rapidly-growing Asian nation by 2015.

Moreover, the Seattle-based corporation also predicted China will attain the status as its second-biggest market, behind the US, in just two years' time.

"China is a focal point of our global expansion efforts," Belinda Wong, the president of Starbucks China, said. 

In further demonstration of this, the organisation plans to boost its headcount from 12,000 to 30,000 in the coming three years, alongside implementing a range of other schemes.

To take one example, Starbucks intends to occupy some outlets offering almost 3,800 square feet in floor space, and catering to groups of friends, students, business contacts, and so on.

Such a move reflects the fact the smaller kiosk-style sites that have proved popular in the US do not fully meet the requirements of the Chinese market.

As part of a wider localisation drive, the company hopes to develop more flavours specifically for buyers in the world's most populous nation, where it already sells lines like red bean frappuccinos.

It also offers Thai-style prawn and Hainan chicken and rice wraps, products created by its domestic R&D centre to suit Chinese palates. "We don't do one size fits all," Wong told the Wall Street Journal,

To bolster its talent management credentials, the firm has launched the Starbucks China University, providing training in retail and leadership skills, as well as promoting expertise in coffee.

"Our partners are at the heart and soul of our signature Starbucks experience, and also the cornerstone of Starbucks success," said Wong. "These investments are critical as we work to achieve our ambitious goals and future aspirations in China."

Data sourced from Wall Street Journal; additional content by Warc staff