Starbucks will start coffee deliveries in China

Starbucks will start coffee deliveries in China next month in a partnership with internet heavyweight Alibaba, as the US company looks to protect its lead in a fast-growing coffee market where it is facing tougher competition and a decline in sales. Alibaba’s food delivery platform Ele.me will begin making deliveries from 150 Starbucks outlets in September, expanding to 2,000 stores by the end of the year… Starbucks controls 80 per cent of China’s coffee shop market… and generated $3.24 billion of its revenues from Asia-Pacific last year — or about 15 per cent of its global total. In May it unveiled a bold plan to triple Chinese revenue and nearly double the number of outlets in the country to 6,000 over the next five years. But the chain stunned the market just weeks later when it warned that same-store sales growth in China would be flat or negative in the third quarter following years of growth… Starbucks is seen as an upmarket brand in China and the deal with Alibaba is a blow to the internet group’s main rival, Tencent, and the delivery platform it backs, Meituan… The US company has more than 3,300 outlets in China and opens new stores at a pace of 600 a year.

 

Tom Hancock

 

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