Pacific Coffee Aims for 1000 Stores in China, Challenging Starbucks

In the fast-growing Chinese coffee market, one brand is making bold moves. Just a year after entering the mainland market, Pacific Coffee—backed by Hong Kong conglomerate China Resources—is rapidly expanding, aiming to challenge Starbucks’ dominance. With a goal of 1000 stores nationwide, the company already has 13 locations open and plans to hit 50 by the end of the year.

Pacific Coffee plans to have 50 mainland stores by the end of 2011 and eventually open 1000 cafés in China. The brand currently operates over 100 stores in Hong Kong and more than 120 across Asia.

Pacific Coffee’s Rapid Expansion Strategy

Pacific Coffee opened its 13th mainland store in Beijing’s Guomao area. The company entered the mainland market in April 2011 with its first store in Shanghai. CEO Thomas Tong revealed that expansion will focus primarily on Beijing, Shanghai, Guangzhou, and Shenzhen, using a model of direct operation with some regional franchising.

Tong expressed optimism but also caution, noting that major cities already host strong competitors like Starbucks. He also pointed out the rising costs of rent, labor, and raw materials. Still, the brand believes its backing from China Resources will help secure government support, logistics, and retail infrastructure to speed up growth.

The Backing of China Resources

China Resources, a centrally owned state enterprise, operates over 3000 retail outlets across China. Pacific Coffee is managed by its subsidiary, China Resources Vanguard. This connection gives Pacific Coffee access to established retail channels, logistics networks, and customer traffic—advantages that could accelerate its rollout compared to standalone competitors.

“Pacific Coffee fills a gap in our retail portfolio,” said Tong. “The support from our parent company is significant, and we are sharing resources across the group.”

The Market Opportunity in China

According to internal research conducted since Pacific Coffee’s acquisition, the average annual coffee consumption per person in mainland China is just 0.1 cup—compared to 4 cups in Hong Kong and 35 cups in Japan. This indicates a largely untapped market where growth is driven more by volume than by loyalty or specialty preference.

Pacific Coffee sees potential in educating the market. With such low baseline consumption, the brand is betting on rapid scale to establish a strong foothold before taste preferences fully develop.

Pacific Coffee’s Current Footprint

As of the report, Pacific Coffee has opened its 106th store in Hong Kong, making it the city’s second-largest coffee chain. Its total presence includes over 120 cafés across Hong Kong, Macau, mainland China, Singapore, and Malaysia—still behind Starbucks globally but rapidly catching up regionally.

Frequently Asked Questions

How many Pacific Coffee stores are there in China?

As of the latest update, Pacific Coffee has 13 stores in mainland China and over 100 in Hong Kong, with plans to expand to 50 on the mainland by the end of 2011.

What is Pacific Coffee’s long-term goal in China?

Pacific Coffee aims to open 1000 stores across China, targeting major urban centers initially and leveraging its connection to China Resources for support.

How does Pacific Coffee’s expansion compare to Starbucks?

Starbucks has around 400 stores in mainland China after more than a decade, while Pacific Coffee plans to reach 50 stores in much less time and has an ultimate goal of 1000.

Why is Pacific Coffee expanding so quickly in China?

The brand is capitalizing on low per-capita coffee consumption (0.1 cup/year) and is backed by China Resources, giving it access to retail, logistics, and government resources to accelerate growth.

Where is Pacific Coffee expanding first in mainland China?

The initial focus is on first-tier cities: Beijing, Shanghai, Guangzhou, and Shenzhen, where the market is competitive but also offers the highest potential customer base.

How many stores does Pacific Coffee have in Hong Kong?

Pacific Coffee has opened its 106th store in Hong Kong and is now the city’s second-largest coffee chain, with a total of over 120 stores across Asia including China and Southeast Asia.

Recommended FrontStreet Beans for Café Culture

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