INDUSTRY BRIEF: Starbucks joins China coffee wars with price cuts
Starbucks Corp. (SBUX.US) said on Monday will lower the prices on some of its iced drinks in China by an average of 5 yuan ($0.70), according to media reports, as the coffee giants yields to pressure to compete in the country’s ongoing premium coffee and tea price wars of the last two years.
The coffee chain said it wants to make its drinks, including non-coffee beverages, more “accessible” to Chinese consumers, according to the reports, citing a message on the company’s public WeChat account. The new prices will become effective on Tuesday.
Starbucks previously vowed it wouldn’t enter the coffee price wars launched by local chain Cotti that have seen many companies, including Luckin (LKNCY.US), selling cups of premium coffee for 9.9 yuan. The company’s decision comes as its China same-store sales start to stabilize this year after posting double-digit declines in 2024.
Starbucks has been losing business to its lower-cost rivals as Chinese consumers cut back their spending during the country’s economic slowdown.
By Doug Young
To subscribe to Bamboo Works weekly free newsletter, click here
