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Starbucks in China

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Case study: Starbucks in China
Starbucks – A global company?

The 1971 founded company Starbucks has undergone an impressive expansion throughout the last years and as a result now is the leading coffee house retailer in the world. Due to several joint ventures, partners, and an enormous amount of directly operated stores, it is present in more than 34 countries and serves around 33 millions of customers per week.1 Moreover, the company significantly increased its global publicity within subscribing to strategic alliances with various hotels, air carriers, schools, and stadiums.

Nevertheless, Starbucks possesses an immense core business in the United States, which is based on its corporate roots in Seattle, as well as the huge market …show more content…

This would also be very consistent with Starbucks’ guiding principles that state: “Embrace diversity as an essential component in the way we do business”.6 Moreover, the American coffee company will have to face the Chinese’ increasing national pride to avoid Western brands, which makes it even harder for Starbucks to establish a strong and positive image in the long-term.

Furthermore, their target customers and therewith their probable locations are limited to the major cities and the coastal urban areas. But within these areas, Starbucks has a good potential, since a growing number of young, trendy people are willing to spend more money on luxury goods, as the Starbucks products are in China. In this context, tourists also capture an increasingly important position, since they are more and more traveling to China and hence are possible Starbucks clients as well. Additionally, the middle class starts to earn more money and thus also represents a potential future consumer.

As a result of the growing amount of prospective customers and so copycats, it could be a challenge for the global company that the market suddenly is oversaturated, since coffee still remains anything but the Chinese’ favorite beverage.

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