Starbucks Wins 90% of U.S. Coffee

The long-delayed Starbucks Beijing and Tianjin market equity recovery issue finally surfaced. Yesterday, Starbucks announced that through the acquisition of shares, Starbucks has obtained 90% of the shares of Beijing Meida Coffee Co., Ltd. and recovered the operating rights of the Beijing-Tianjin region. At this point, Starbucks has completely renounced its authorized operations in China, and it is only one step away from full direct operation.

Yesterday, Starbucks and H&Q Asia Pacific held a joint press conference. Wang Jinlong, president of Starbucks Greater China, announced that Starbucks has repurchased shares of Beijing Meida Coffee Co., Ltd. and Han Ding Asia Pacific and other shareholders, and withdrew Beijing Meida Starbucks in Beijing. And the main operating rights in the Tianjin area. Wang Jinlong disclosed that the proportion of Starbucks's controlling stake in Midea Starbucks reached 90%, and other minority shares were still held by Beijing Sanyuan Company. He stated that Starbucks will not withdraw a minority stake in U.S. dollars holding the U.S. dollar for the time being, but it does not rule out future changes. Wang Jinlong also said that both sides are very satisfied with the price of the equity transaction, but are unwilling to disclose specific figures.

Martin Moles, president of Starbucks Coffee International Co., Ltd., said in an interview with reporters yesterday that obtaining more equity in the Chinese market is an important part of Starbucks' global strategy. He said Starbucks plans to open 20,000 new stores in the international market, half of which will be settled in the Asia Pacific region, and China will become Starbucks' largest international market. Martin said that after holding the U.S. Starbucks, Starbucks' business model in the Beijing-Tianjin region will be changed to direct operating, and Starbucks will no longer have an authorized operating model in China, and will no longer develop franchising in the future. According to Martin, Starbucks will leave Starbucks after the Starbucks buyback of Beijing Meida Starbucks, and the new head may come from Seattle.

Xu Dalin, president of H&Q Asia Pacific, said H&Q Asia Pacific completed its mission of successfully introducing Starbucks into the Chinese market. According to the needs of Starbucks market development, H&Q Asia Pacific believes it is the best time to withdraw from Starbucks at this time. He said that in the future, H&Q Asia Pacific may invest heavily in consumer and hospitality industries. The most recent project may be the Hilton Business Hotel.

As early as February of this year, Starbucks Global Chairman Howard Schulz said that Starbucks will no longer develop franchise in the future, Starbucks investment in China in the next five years will be changed from authorized franchise to Direct. Yesterday, Weng Yideng, Vice President of Starbucks Greater China, confirmed this statement. He said Starbucks currently has no authorized operating model for more than 190 stores in 19 cities in the Mainland. In South China, such as Guangzhou and Shenzhen, in North China, where Beijing and Tianjin are dominant, in Southwestern, mainly in Chongqing and Chengdu, and in other cities, such as Dalian and Shenyang, Starbucks is already a direct operating model, and only in East China, which is dominated by Shanghai. It is still a joint venture with the Taiwan United Group. Weng Yideng said that the use of joint ventures or direct operations is based on the specific conditions of the local market, but in most markets such as North America, Starbucks is a wholly-owned direct operation.

Starbucks' business model in China completes transformation

In the early 1990s, when Starbucks entered the Chinese market, it had authorized regional partners but did not participate in the business. In Beijing, Shanghai and Guangzhou, they chose Beijing Meida Starbucks, Shanghai Unistar Starbucks, and Maxim Starbucks and authorized them to develop the local Starbucks market. In 2003, Starbucks headquarters increased its stake in Shanghai Starbucks to 50%; subsequently, its stake in Maxim's Starbucks increased from 5% to 51%. The company repurchased the controlling and operating rights of the U.S. company and Starbucks completed the transformation of its business model.