Starbucks launches all-day cafe in China

The effort, aimed at expanding its foothold in the highly competitive Chinese market, will see Starbucks competing with local Chinese startups, including Luckin Coffee.

On Friday, Starbucks Corp stated it will be launching a new all-day dining cafe in China whose menu will include cocktails and brunch. The move assumes significance as Starbucks, the world’s largest coffee chain, is trying to expand its retail offerings to markets overseas midst increasing competition.

Starbucks is facing increasing pressure midst slowing sales from a growing number of independent coffee shops, which include Chinese startups such as Luckin Coffee which offer big discounts.

“Today marks yet another significant milestone as we take everything we have learned around coffee and our relentless pursuit for food innovation, to create a new exciting all-day cafe dining and Italian aperitivo experience,” said Belinda Wong, Starbucks China’s CEO in a statement.

The Starbucks Reserve Bakery Cafe, which opens this weekend, is the firm’s first such store in China and will offer its premium coffees, freshly prepared food from its Princi Italian bakery and alcoholic drinks from a “mixology” bar”.

Back in its home turf, Starbucks has similar cafes where it has been pursuing an upscale strategy.

Although Starbucks has largely benefited from a growing cafe culture in China however its success has given rise to a host of ambitious local competitors, including Luckin Coffee which stated it wants to open 2,500 new stores in 2019 and overtake Starbucks as China’s largest coffee chain.

According to analysts, Starbucks’ efforts to improve sales is gaining traction: its quarterly sales in China have beaten its estimates in January 2019.

Categories: Creativity, Entrepreneurship, HR & Organization, Strategy

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