Starbucks plans to double stores in China in 5 years

NEW YORK, N.Y. – Starbucks is pushing ahead with its expansion into mainland China, saying Wednesday it’s on track to have 5,000 stores by 2021, more than doubling the number of its coffee shops in the country.

The Seattle-based coffee chain is looking to China to fuel its growth. It’s grown rapidly since opening its first Chinese store in 1999, though famously suffered a misstep nearly a decade ago when protests over a shop inside the Forbidden City led to it being closed. Starbucks CEO Howard Schultz has said China could one day surpass the U.S. as the chain’s largest market. There are about 13,000 Starbucks stores in the United States.

Among chain coffee shops, Starbucks had a 74 per cent market share in mainland China in 2015, according to market research company Euromonitor. The company’s closest competitors are McDonald’s Corp.’s McCafe and Whitbread PLC’s Costa Coffee, both of which had market shares slightly above 9 per cent, according to Euromonitor.

Starbucks has been adding unique flavours to attract Chinese customers, such as a Black Forest Latte, a mix of cherry juice, cocoa powder and coffee. And in September it began selling its Teavana tea brand at its China locations.

Chinese customers spend more time in Starbucks shops and are buying more food than Americans, Schultz told The Associated Press. Late next year, Starbucks plans to open a 30,000-square-foot store in Shanghai that Schultz called a “Disneyland for coffee.” Named the Starbucks Roastery and Reserve Tasting Room, the store will be similar to one opened in Seattle nearly two years ago, where customers can watch coffee beans get roasted and sip mixed coffee drinks.

To oversee its expansion in China, Starbucks Corp. said Wednesday that it named Belinda Wong as the first CEO of its Chinese business. Wong was president of Starbucks China, and has worked for the company for 16 years.