Starbucks Articles - Page 1 1 of 993 DOCUMENTS The Straits...

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1 of 993 DOCUMENTS The Straits Times Singapore September 7, 2011 Wednesday Starbucks perks up profits with instant coffee; Launch of single-serve packets here is part of Asia-Pacific expansion BYLINE: Esther Teo SECTION: MONEY LENGTH: 450 words DRINKS chain Starbucks launched an instant coffee at its 313@Somerset store yesterday - part of its strategy to capture a slice of the fast-growing Asia-Pacific market. Starbucks Via Ready Brew, which comes in single-serve packets, has already been launched in the United States, Japan, China, Taiwan and the Philippines. Singapore is one of six additional Asia-Pacific markets to get the ground coffee sachet, a sign of how the region is gaining in prominence for Starbucks . Starbucks Asia-Pacific president Wang Jinlong said at yesterday's launch that growth in countries such as South Korea and China was tremendous and that revenue share from the region was increasing 'dramatically and substantially'. The firm plans to continue accelerating its expansion in the region. The size of the instant-coffee market across the 10 Asia-Pacific markets in which Starbucks operates is estimated at US$4 billion (S$4.8 billion). Singapore's portion is about $70.4 million but the market remains important for building the Starbucks brand, Mr Wang said. While the sachets are available only at Starbucks stores now, Mr Wang hopes to eventually place them at retail points such as supermarkets. The instant brew has already notched sales of more than US$200 million around the world, but Starbucks aims to lift that to US$1 billion eventually. It also intends to continuing expanding aggressively in existing markets and making strides into new ones. Starbucks has about 1,400 outlets in the Asia-Pacific region and none of its markets recorded a decrease in business over the past year. Expansion is expected to be centred on its international markets, with 600 stores expected to open in the next financial year. There will be 200 new outlets in the US over the same period. Mr Wang said it will enter the Indian market next year and Vietnam is on the cards for 2013. China is also primed for rapid expansion, with plans to treble the 470 outlets there to 1,500 by 2015. The number of Page 1
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outlets in South Korea is expected to double to 700 over the next five years. Mr Wang added that Starbucks plans to introduce other innovative products, not just those imported from the US but ones developed locally as well. The green tea frappuccino, for example, was developed in Asia but has now become a core product around the world, he noted. There are also plans to expand the tea business - worth more than US$1 billion - in the region, he said. While plans have been announced to roll out single-serve portion packs for beverage machines that can be used at home for the US and Canada, there are no plans as yet to expand sales of this product to other markets. esthert@sph.com.sg
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Starbucks Articles - Page 1 1 of 993 DOCUMENTS The Straits...

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