Starbucks Corp. (SBUX: Quote) plans to triple the number of shops as well as workforce in China over the next three years in an effort to tap a market that is estimated to become the second-biggest for the coffee chain by 2014, reports said.
The company will have about 1500 shops by 2015, spread over 70 citites in China and will look at expansion through smaller cities. At present, Starbucks has about 10,000 employees working in over 500 stores in the world's second-largest economy.
China, renowned for its tea history, is one of Starbucks' growth stories outside the home market. With coffee shops spotted around almost every corner of streets, these are becoming a socializing point for the people.
In the first quarter, the company's China/Asia-Pacific segment revenue jumped 38 percent to $166.9 million due to revenues from 85 new stores and a 20 percent increase in same-store sales.
A recent price increase by the company in China to offset rising costs did not discourage customers, indicating that the business has a great untapped potential.
America's iconic coffee brand late last month launched a new line of "Refreshers" coffee-based beverages, taking a shot at energy and juice drinks. The brand is expected to take on well known energy drink brands such as Red Bull, Monster and Rockstar.
Starbucks Refreshers will be real fruit-flavored ready-to-drink carbonated energy drinks made with a virtually flavorless extract of green, unroasted coffee, and less caffeine. The drink will reportedly contain a mild caffeine content.
SBUX closed on Friday at $55.89, up $0.16 or 0.29 percent, on 4.49 million shares and dropped $0.91 in the extended trade.
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by RTT Staff Writer
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