COSTA keeps an eye on Starbucks, regardless of cost. Two coffee giants fight hand-to-hand

A huge amount of money rolls on a longer industrial chain. From upstream coffee bean cultivation to terminal stores, derivatives, and even products into supermarkets, Starbucks is essentially a trading company rather than a coffee shop.

The Starbucks International Trade Store, which welcomed guests in January 1999, was Starbucks' first store in mainland China, so when the news of "withdrawing the store" was confirmed a month ago, the friends were shocked. "it turns out that Starbucks has problems, too."

A drink worth more than 35 yuan is a luxury that ordinary people can afford. In China, this cup of coffee brings psychological feeling that "value for money".

"maybe it's to experience the Western way of life." White Dew used to work at Starbucks when he was in college, and his pay was much better than his classmates at KFC. "there is also a free drink for employees every four hours." At that time, Starbucks still excelled in the Chinese market. "White-collar workers either have a saying,'I am either at Starbucks or on my way to Starbucks'."

Starbucks did not make clear its position on the reasons for the closure of ITC I stores, but the market generally believes that the main reason is that rising rents have broken through its revenue "red line". Ma Guangyuan, a financial commentator, points out that as the premier high-end office building in the CBD area, Starbucks stores rent more than 1000 yuan per square meter per month, almost double that of nearby ITC Phase III.

In fact, the adjustments made as a result of changes in the business environment have long been passed on to the details. Starbucks napkins are no longer as thick as Pizza Hut, and cups are switched to "paper cup mode" by default.

However, the real challengers are only just emerging, and they are attracted by China's booming market.

The global CEO of WHITBREAD Group, the parent company of COSTA, made a special flight to Beijing in the summer of 2011 to promote the opening of COSTA's 100th store in China at Terminal T3 of the Capital Airport. This is almost a naked "provocation" because the store site was previously owned by Starbucks.

COSTA is the largest coffee chain in the UK. Since entering China in 2007, COSTA has replaced Starbucks as the fastest expanding coffee shop in the Chinese market. Just as KFC and McDonald's are inseparable, COSTA is like choosing a location with a Starbucks store layout map, with almost every store keeping an eye on Starbucks and seemingly regardless of cost when robbing the store. According to media reports, in order to take down Terminal T3, excluding the property fees and various management fees paid to the airport, COSTA pays a monthly rent of up to 600000 yuan, which is four to five times the monthly rent of an ordinary shopping mall.

Behind the fashionable and romantic cafe is the arena of capital.

However, Wang Dongsheng, founder of Food still International, believes that for group-style foreign brands, there is no need to pay too much attention to the success or failure of one or two stores. "Starbucks closes stores because every year the company has strict cost accounting indicators, out of mature business management and strategic considerations." Wang Dongsheng believes that in a sense, the storefront is just the space that the big groups show to the outside, and the huge capital rolls on the longer industrial chain.

(responsible Editor: Leo)