Now Shenzhen | August 21, 2023
STARBUCKS, the world’s largest coffee chain, will set up an innovation and technology center in Shenzhen, with initial investment of about 1.5 billion yuan (US$206 million) over the next three years, the U.S. company said Friday.
The Starbucks China Innovation and Technology Center will be launched in Futian District, according to an investment framework agreement signed between the Futian district government and Starbucks China on Friday.
The center is scheduled to open in September and “will accelerate the digitization of Starbucks retail operations and omnichannel business in China,” Starbucks said in a statement on its website.
As Starbucks’ retail innovation hub in China, the center will “provide an exciting platform for brewing human-centric innovations that reimagine Starbucks’ retail landscape and customer experience in China,” Starbucks said.
The establishment of the center is also regarded as a landmark project for Futian’s accelerated progress towards becoming a “central innovation zone” and an innovative practice in the deep integration of fashion consumption industry with digital applications, Shenzhen Economic Daily said yesterday.
China has been a key growth driver for Starbucks, which entered the Chinese market in 1999. After over 20 years of growth, China has become Starbucks’ largest international market and one of its most important strategic markets. Currently, Starbucks has over 6,500 stores on the Chinese mainland, having presence in 250 cities.
The U.S. coffee chain operator aims to increase its store numbers in China by 50% to 9,000 stores by 2025 as well as double its sales and quadruple its operating income through efforts including store expansion, growth in omnichannel engagement and at-home and on-the-go coffee services, according to Starbucks’ Reinvention Plan, which was unveiled during the company’s biennial Investor Day conference in September in 2022.
“We have chosen Futian because Starbucks has full confidence in Shenzhen’s market prospects and business environment. In the future, we will utilize cutting-edge digital technology to open more green and innovative stores,” Zhu Lei, vice president of government affairs and social impact of Starbucks China, said.
The establishment of the center will greatly promote Starbucks’ digital innovation, Zhu added.
As Shenzhen’s central district, Futian has over 1,300 coffee shops, with approximately eight coffee shops per 10,000, making it one of the areas with the highest density of coffee shops in the country, official data show.
Behind the rapid rise of Futian’s “coffee economy” is not only a large number of domestic coffee brands, but also the “catfish effect” created by Starbucks as a coffee chain giant to motivate the fast growth of the local coffee sector.
After years of development, Starbucks Shenzhen has become the leading firm in the catering industry in Futian.
Starbucks, which has grown nearly tenfold in the past decade on the Chinese mainland, plans to open the Starbucks China Coffee Innovation Park this fall, another landmark investment that will feature a smart integrated distribution center and other infrastructure designed to unleash its growth in China.
A traditionally tea-sipping country, China has in recent decades emerged as a heavy drinker of coffee and other new beverages, thanks to fast-growing disposable incomes, rapid urbanization and the rising interest in exotic and novel drinks.
According to e-commerce platform Meituan, China’s coffee industry was estimated at 200 billion yuan in 2022 and it is projected to reach 369 billion yuan in 2025. (Yang Yunfei)
ARTICLE FROM: Shenzhen Daily