Can Chinese Customers Rescue Starbucks?

The Journal.

The Wall Street Journal

Daily News, Business News, News

4.2 • 5.3K Ratings

🗓️ 9 May 2024

⏱️ 15 minutes

🔗️ Recording | iTunes | RSS

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Summary

Starbucks has a problem: Sales at U.S. stores have fallen sharply and now the company is looking to China, its second biggest market, to boost its revenue. But as WSJ’s Spencer Jakab explains, increased competition there is making that a tall order. Further Reading: -Starbucks Is Running Out of Americans to Drink Its Expensive Coffee -The Furious Race for the Future of Coffee Further Listening: -The Underdog Coffee Bean That’s Making a Comeback Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Last week, Starbucks released its latest earnings, and they weren't good.
0:10.0	Starbucks out with a disappointing set of earnings for the first quarter yet.
0:17.0	Starbucks stock right now is down 12%.
0:20.0	The shares though getting crushed, I mean just hammered this weekend
0:25.3	Starbucks has a big problem Americans aren't going to its cafes as often as they used to. And the company's solution
0:34.0	is to turn to a different market, China.
0:38.0	How important is China to Starbucks's business right now?
0:42.0	China is extremely important to Starbucks's business right now. China is extremely important to Starbucks's business,
0:45.0	so it is their second biggest market.
0:47.0	For the 24 of the last 25 years,
0:50.0	they were either the only game in town
0:52.0	or the biggest coffee chain out there.
0:55.0	But our colleague Spencer Jacob says, over the past 25 years, the market in China
1:02.0	has changed dramatically.
1:05.0	It's become suddenly a very saturated one and very competitive for them.
1:11.0	Now a lot of Chinese chains are seen as being almost as good and
1:16.0	certainly more aggressive on price and that's that's the problem that
1:20.1	that Starbucks has.
1:28.0	Welcome to the journal, our show about money, business, and power. I'm Kate Leimbaw.
1:30.0	It's Thursday, May 9th.
1:38.0	Coming up on the show, Starbucks is bad first quarter
1:41.0	and it's planned to use China to turn by Oracle. AI is storming every industry, but how do you compete
	...

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