Starbucks is set to open its first café in Vietnam next month.
Starbucks Corporation (NASDAQ:SBUX) will open its first Vietnam café in Ho Chi Minh City early next month. The company said on Thursday that it intends to spread its brand of coffee shops across Asia.
The Seattle-based chain is hoping to enter the Vietnamese coffee market, which already has a number of prominent home-grown chains. One of Starbucks’ competitors in the region will be Vietnam’s leading upmarket coffee shop chains: Highlands Coffee. Already a well-established chain, Highlands Coffee already has over 80 coffee shops throughout Vietnam.
Starbucks Corporation (NASDAQ:SBUX) says that it already operates over 3,300 stores, across 11 countries in China and the Asia-Pacific region. The company intends to boost the number of stores to 4,000 – with 1,000 outlets throughout mainland China; up from the 700 it currently has. Starbucks said that it wants the new Vietnam-based cafes to celebrate the country’s “coffee culture and heritage.”
Jinlong Wang, president of Starbucks Asia Pacific, said he was “very excited” about the company’s entry into Vietnam, saying in a statement: “We are looking forward to serving our customers in Vietnam in an authentic and locally relevant way”. He talked about the “emerging middle class consumers who want to enjoy international products”
As the world’s second largest coffee producer behind Brazil, Vietnam already provides Starbucks stores in other countries with high-quality coffee beans. Coffee was introduced to the country by French colonisers in the nineteenth century.
Starbucks Corporation (NASDAQ:SBUX) said that it has designated a subsidiary of Hong Kong-based Maxim’s group as its licensee in Vietnam. With its planned move into Vietnam in early February, Starbucks will be joining other US brands with stores already in the country, including Subway and Yum! Brands, Inc. (NYSE:YUM)’ KFC and Pizza Hut.
In the fourth quarter of 2012, the Asia-Pacific region brought Starbucks $198 million in revenues. Its Americas division brought $2.5 billion, in comparison. Despite lower revenues, the market is Starbucks’ fastest growing, with fourth quarter revenues growing by 23 percent year-on-year.
Starbucks Corporation (NASDAQ:SBUX) shares were up slightly on Thursday with the news of their expansion. At the time of writing, shares were at $55.23, up by 0.42 percent.