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Starbucks Corporation Continues to Expand as it Adds Thousands of New Stores in China

By January 14, 2016 at 2:36 am
Starbucks Corporation Continues to Expand as it Adds Thousands of New Stores in China (Photo : China Photos | Getty Images News)

CHINA - Starbucks Corporation, a famous coffeehouse chain, is expanding its business as it plans to add thousands of new stores in China until 2019 despite facing economic concerns that may inhibit the growth of newly established businesses in the communist state, the company said on Tuesday.

In an interview with The Wall Street Journal, Starbucks Corporation CEO Howard Schultz said he has no qualms on its plans to build new coffee shops in a country that has recently having economic issues.

"We have confidence in the future of the Chinese economy, despite all the rhetoric, noise and issues," Schultz said while on a trip going to China. "People are looking for reasons not to believe. I'm on the ground and I see firsthand. I am bullish."

Currently having 2,000 stores in 100 cities in China, Starbucks Corporation aims to build 3,400 shops by 2019, starting its expansion with 500 new stores by the end of 2016, CNN Money reports.

Over the past year, the coffeehouse chain's stock has had a 30 percent increase in their sales. From 2014, its latest report showed a nine percent growth coming from the same-store sales in Asia and China, a faster growth rate than in Africa, Middle East, Europe or America.

However, China decreased its growth by six percent in the latest quarter, "a drop from an increase of 11 and 12 percent" that had been recorded in the previous quarters, according to the report of International Business Times.

Despite having a slow economic growth, Schultz is hopeful that China will become Starbucks' biggest market, generating 10,000 new jobs and opportunities every year as they pursue their expansion until 2019. He also announced that full-time baristas and supervisors working in China will be given stipend to compensate half of the employees' housing costs.

"As Starbucks' second largest and fastest-growing market globally, China represents the most important and exciting opportunity ahead of us," Schultz said.

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