"The US coffee giant will retain a 40 percent interest in its China operations while maintaining its ownership of the company's brand and intellectual property, the company said. The deal marks a new chapter in Starbucks's 26-year-long history in China, the company said in a statement. It will also give Starbucks a much-needed injection of funding and logistical support as it tries to expand its business deeper into China, according to Jason Yu, the Shanghai-based managing director of CTR Market Research."
"Starbucks used to be a pioneer in coffee in China, where it was probably the first coffee chain in many cities, but this is no longer the case as the local competition already outpaced Starbucks in their expansion, Yu told Al Jazeera. Top competitors include homegrown Luckin Coffee, which has more than 26,000 locations worldwide, mostly in China. Starbucks has historically been concentrated in first- and second-tier cities like Shanghai, Beijing and Shenzhen while Luckin has expanded into much smaller cities."
Starbucks will sell a 60 percent stake in its Chinese retail operations to Hong Kong-based Boyu Capital for $4bn, forming a joint venture. Starbucks will retain a 40 percent interest and ownership of the company's brand and intellectual property. Boyu Capital has offices in Shanghai, Beijing and Singapore, and cofounder Alvin Jiang is the grandson of former Chinese President Jiang Zemin. Starbucks operates about 8,000 locations across China and aims to grow to 20,000 through the joint venture. Local competitor Luckin Coffee runs more than 26,000 locations, expanding into smaller cities and offering cheaper drinks via loyalty programmes and in-app promotions. The deal provides funding and logistical support for deeper expansion into China.
Read at www.aljazeera.com
Unable to calculate read time
Collection
[
|
...
]