Starbucks Expects China to Be Its Top Global Market

Starbucks isn’t just serving coffee in China—it’s betting big on becoming part of everyday life there. After entering the market 17 years ago, the company has now opened over 2,000 stores and shows no signs of slowing down. But how did a country with traditionally low coffee consumption become such a strategic priority? And what does this mean for the future of global coffee retail?

Yes, China is on track to become Starbucks’ largest market. The company had over 2,000 stores in China by 2016 and planned to add thousands more, reaching an expected 3,400 stores by 2019—a near doubling in just four years.

Starbucks’ Rapid Expansion in China

Howard Schultz, then Starbucks’ chairman and CEO, stated at a China partners and families event that China is the company’s fastest-growing major market and represents “the most important and exciting opportunity.” He predicted that China would soon surpass all other regions to become Starbucks’ top global market.

Strategic Partnerships and Digital Growth

The coffee giant also deepened ties with Chinese tech leader Alibaba. Since launching its official flagship store on Tmall in December of the prior year, Starbucks reported over 300,000 followers. While the store doesn’t sell physical coffee beans, it offers digital gift cards worth 50 or 100 RMB and other “Starbucks-themed electronic gifts,” reflecting the brand’s adaptation to local consumer habits.

High Margins and Employee Benefits

Financially, China and Asia-Pacific deliver impressive returns. Starbucks’ reports showed the region achieving a 32% profit margin—far above the 21.1% in the Americas and just 1.9% in Europe, the Middle East, and Africa. In response, Schultz introduced enhanced benefits for staff in China, including a “housing allowance” covering up to 50% of average city rent costs, underlining the company’s commitment to its workforce in high-potential markets.

The Bigger Picture

Schultz’s remarks came alongside public support from Alibaba’s chairman Jack Ma, who praised Starbucks for transforming coffee culture in a non-coffee-drinking nation. “I started my business when Starbucks was already a legend,” Ma said, calling the brand’s success in China remarkable and worth learning from.

Frequently Asked Questions

When did Starbucks open its 2,000th store in China?

Starbucks opened its 2,000th store in China in 2016, marking 17 years since its entry into the market.

How many Starbucks stores did the company plan to have in China by 2019?

Starbucks aimed to have 3,400 stores in China by 2019, nearly doubling its 2016 count of over 2,000 stores within four years.

Why does Starbucks consider China its most important market?

China is Starbucks’ fastest-growing major market with a 32% profit margin in the China and Asia-Pacific region, significantly higher than other global regions, making it highly profitable and strategically vital.

What digital initiatives has Starbucks launched in China with Alibaba?

Starbucks launched an official Tmall store with over 300,000 followers, selling digital gift cards and electronic products rather than physical coffee beans, adapting to local e-commerce trends.

What employee benefits did Starbucks introduce in China?

Starbucks announced a housing allowance program in China, covering up to 50% of average city rent costs, along with emphasizing high profitability and long-term investment in its workforce there.