Starbucks global expansion strategy with a focus on China

Although the initiative Starbucks opened in 1971 it wasn?t until the 1990s that the come with became the iconic coffee symbol of America. Starbucks? popularity exploded along perspective a changing generation of young Americans who were on the operate and connected to the world-wide-web, while yearning for bigger and better, no look the cost. This generation quickly became known as the ?Starbucks Generation? and now, a decade later; it?s spilling over into a easy China. Starbucks entered China in 1999 and has now made it their number unmatchable target for growth. Why and how did Starbucks venture into the orient? Let?s begin by taking a look at their global/entry strategy along with decision factors. Secondly, we go away focus on the Chinese government?s realistic influence on the company. Fin all in ally, we?ll touch on future strategical factors.

Starbucks international entry strategy for China was basically two-fold. The first phase of the entry was to build the brand name. In the initial stages Starbucks tried the waters by offering free cups of Starbucks coffee to hotel guests indoors the city of Beijing. This allowed Starbucks to see how coffee would sell in a primarily tea drinking market. With the combination of foreigners familiar with brand and the Chinese willing to blend-in with the western ways, Starbucks soon realized they had something create from raw stuff and pursued the China market.

The second phase of entry, although equally important, was look into and development. Since Starbucks refused to use franchising they created a joint venture with Chinese chairman Group which allowed them to cut out the middle-man, thus enabling all stores to be company-owned. This overall strategy helped Starbucks to successfully penetrate the Chinese market with success. Now that we?ve seen how Starbucks entered China let?s acknowledge a look at where the Chinese government fits in.

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