Starbucks China plans aggressive expansion with local partner

Starbucks China is poised to enter a new phase of growth following the completion of a strategic partnership with Boyu Capital, the company announced in Shanghai on April 8, as the coffee giant pivots toward a more localized operating model to better compete in one of its most critical markets.

Under the agreement, Boyu Capital-managed funds now hold a 60% stake in Starbucks’ China retail operations, while Starbucks retains a 40% ownership interest along with ownership of the brand and its intellectual property within the joint venture.

Approximately 8,000 company-operated stores on the Chinese mainland will transition to a franchising model managed by the joint venture. The partners aim to eventually expand to 20,000 stores in the long term.

Starbucks first entered the Chinese mainland in 1999, opening its first store in Beijing.

Cathy Smith (2nd L), Starbucks chief financial officer, Alex Wong (3rd L), Boyu Capital partner, and Molly Liu, Starbucks China CEO (4th L), pose for a photo at the Starbucks China Partner Forum in Shanghai on April 8. Photo courtesy of Starbucks China

Molly Liu, Starbucks China CEO, delivers a speech at the forum. Photos by Zhang Yu unless otherwise stated

The move comes as consumer preferences evolve at what Starbucks China CEO Molly Liu called “China speed,” with growing complexity in customer behavior, consumption scenarios, and technological innovation.

“The new Starbucks China will be rooted in local soil, make faster decisions and deliver more grounded innovation,” Liu said.

The company has unveiled a “thousand stores, thousand faces”  hyper-localization strategy, aiming to tailor each location to its specific community. The strategy focuses on coffee expertise, product innovation, localized store expansion, community-building, and AI-powered customer engagement.

A new kind of coffee beans for the spring season introduced by Starbucks China is showcased at an exhibition session. 

Starbucks China‘s new high-protein beverage range, which is available across its nationwide store network. 

Starbucks has already introduced a lighter roast developed specifically for the China market and plans to invest in new brewing equipment at more than 1,000 stores in office buildings and commercial districts. It also launched a “high-protein innovation platform” and a sugar-free customization system.

Store growth remains a key priority. Starbucks said it has already opened locations in over 1,000 county-level administrative areas, and aims to reach 1,500 within three years.

The company also announced plans to deploy AI tools to help store managers with operations, marketing and customer engagement, positioning the technology as a “chief growth officer” for each location.

The Starbucks China Innovation and Technology Center announced its relocation to the Hetao Innovation Center at the Shenzhen Park of the Hetao Shenzhen-Hong Kong Science and Technology Innovation Cooperation Zone on Sept. 17, 2025. File photo 

The Starbucks China Innovation and Technology Center, first announced in 2022, unveiled its digital achievements and relocated to the Hetao Innovation Center in Shenzhen last September.

The center aimsto accelerate the digitization of the coffee chain’s retail operations and omni-channel business in China by leveraging the power of data analytics, modeling and decision-making to drive operational excellence and create new experiences centered around people and coffee.