Starbucks' Success Story in China

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Case Details:

Case Code : BSTR306
Case Length : 23 Pages
Period : 1998-2008
Pub Date : 2009
Teaching Note :Not Available
Organization : Starbucks Corporation
Industry : Coffee Retailing
Countries : China

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"We want our customers to recognize that we're not coming to China just to make money, we are coming to China to build an enduring company that they can trust and they can view as one of their own."¹

Howard Schultz, Founder and CEO, Starbucks Corporation, in 2006.

"China's growing middle class wants to enjoy life. We don't want to replace tea, we just want to add another choice, a new lifestyle."²

Wang Jinlong, President, Starbucks China, in 2007.

"The coffee giant may be closing 616 stores here in the U.S. due to poor performance, but in China, the familiar mermaid logo is popping up all over."³

Jane Wells, CNBC Business News Reporter, in 2008.

Introduction

In September 2007, Wang Jinlong, President, Starbucks Greater China, the Chinese arm of the US-based coffee chain, Starbucks Corporation (Starbucks), announced that it was planning to source coffee for its growing China operations from the country itself, within a couple of years. According to news reports, the company had already begun working in this direction by assisting Chinese farmers in the southwestern province of Yunnan in the process of coffee cultivation. Starbucks had reportedly also sent shipments of the cultivated coffee to the US for being tested.

Starbucks' Success Story in China - Next Page>>

1] "Starbucks Banks on Middle Kingdom's Middle Class,"http://knowledge.wpcarey.asu.edu, June 2, 2006.
2] "Starbucks to Source Coffee from China,"www.reuters.com, September 4, 2007.
3] Jane Wells, "China and Speaking Fluent Starbucks,"www.cnbc.com, July 23, 2008.

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