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Starbucks pushes China sales with local brew
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Banking on China growth to offset the business slump in the United States, Starbucks, the world's largest coffee shop chain, is doing more than just opening more outlets. It is brewing a new blend, romantically called "South of the Clouds", of beans grown in Yunnan, the scenic southwest province that is better known for its dark tea than brown coffee.

Starbucks pushes China sales with local brew [Maverick/China.org.cn]
Starbucks pushes China sales with local brew [Maverick/China.org.cn]


How would the Seattle-based coffee vendor describe the taste of its new brew to attract newly converted Chinese coffee drinkers? Imagine these definitions of the abstract taste: bright acidity, herbal spiciness and cocoa feel.

As confusing as these words may sound to the intellect and the senses, the company is going ahead to introduce the mysterious blend first in China and then in Singapore and Malaysia. The innovative move is seen as an important part of Starbucks strategy to maintain a double-digit growth rate in the China market at a time when business in the US is taking a hard hit from the fallout of the credit crisis.

In the past year or so, Starbucks closed more than 200 coffee shops in the US. The company said its business in China has not felt the impact of the global economic slowdown and it maintained that sales of coffee drinks in China could one day rival that of the US market.

"We will still invest and grow in China. I don't see anything changing in that regard. China is an extremely important country for us," said Martin Coles, president of Starbucks Coffee International.

Starbucks opened its first store on the Chinese mainland in 1999 and now has more than 350 outlets in 26 cities. It has become one of the, if not the, most popular coffee brands among Chinese white-collar workers.

Starbucks' optimistic outlook for China stands in sharp contrast to its latest financial results. The company's net profit for fiscal 2008 plunged 53 percent from 2007 to US$315.5 million. The 38-year-old coffee chain has nearly 16,000 outlets around the world, with about 11,000 in the US.

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