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Starbucks to set up joint venture in Yunnan

By : Xinhua | Published: 2012-February-7

U.S. coffee chain Starbucks Monday officially signed a deal with a local coffee-growing and -processing firm to set up a joint venture in southwest Yunnan province.

Starbucks will partner with Ai Ni Group in the joint venture, but the U.S. company will be mainly in charge of the joint venture's operations, the two companies said at the deal signing ceremony in Kunming, capital of Yunnan.

The joint venture will buy and export coffee beans and also build a coffee processing plant in Yunnan, China's major coffee-growing region, the two said.

With the joint venture, Starbucks will increase its coffee bean purchases in Yunnan and use the raw materials to produce coffee products for its stores around the world, said Wang Jingying, president of Starbucks China.

Through cooperation with Ai Ni Group, Starbucks is committed to helping locals improve coffee quality and bring Yunnan coffee to other markets in the world, Wang said.

Executives of the two companies declined to give details about the joint venture at the ceremony.

With the latest move to get involved in the coffee-growing and -processing chain, the Seattle-based company aims to stabilize raw material supply and meet a growing demand for high-quality coffee from Chinese consumers.

Starbucks first entered China in 1999 and has over the years focused on opening more chain stores in primary and secondary cities around the country. Last year it announced a plan to triple China-based stores to 1,500 by 2015.

China is the coffee chain's second-largest market after the United States, and Chinese consumers have embraced Starbucks as a high-quality brand.

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