GLOBAL

 
Starbucks to close Teavana stores and buy back Starbucks China

Starbucks has decided to close all its 379 Teavana stores as they are struggling business and they will likely to continue to do so in the future. It will, however, continue to sell Teavana drinks at its Starbucks stores as well as bottled Teavana beverages in grocery stores.
At the same time, Starbucks is also investing US$1.3 billion to purchase the remaining 50% of its joint-venture business in China, the single largest acquisition in company history. It will be buying the stake from partners, President Chain Store Corporation and Uni-President Enterprises Corporation. At the same time, these 2 partners will be acquiring Starbucks' 50% interest in its Taiwan business, assuming 100% ownership of Starbucks' operations there. That means the 410 Starbucks stores in Taiwan will be fully licensed, rather than joint ventures.
The move means that Starbucks will assume 100% ownership of about 1,300 stores in east China spanning Shanghai, Jiangsu and Zhejiang Provinces. The coffee giant already fully owns another 1,500 stores in the mainland and with the acquisition, Starbucks will have 100% ownership of 2,800 stores in the country. China represents the company's fastest-growing market in terms of store count, outside the US.
Starbucks plans to have 5,000 stores in the mainland by 2021. East China is a significant and strategic region for Starbucks in China, with Shanghai alone having nearly 600 stores, the largest number of Starbucks stores globally in any city.
Starbucks' sales in China have been growing rapidly. In recent quarters, its Chinese store sales grew 6 to 7% compared to only 3% in the US.
In December, Shanghai will also become the first city outside of the US to open a coffee roastery and tasting room.
Starbucks has dominant market share in the Chinese coffee outlet market with 74.6% share followed far behind by McDonald's Corp (9.1%) in 2016 and Whitbread Plc's Costa (8.4%), according to Euromonitor International.