First look at Starbucks' Reserve Roastery in Shanghai

Reserve Roastery in Shanghai China

It's the company's first Reserve Roastery outside the USA and spans nearly 30,000 square feet. Roastery locations offer a bigger, more luxurious experience for coffee-lovers and sell drinks not found on regular Starbucks stores across the world.

Starbucks is partnering with Alibaba Group, owner of the South China Morning Post, to create what it is calling its "immersive AR experience" for customers, run on Alibaba's Taobao shopping app, which allows, for instance, digital menus and ordering, insights into its brewing methods, and merchandising.

Customers can also use Augmented Reality technology to see the coffee making process in their smart phones, and use mobile payment.

The new Shanghai outpost is the chain's largest store yet with an on-site bakery, a 40-ton copper cask and an augmented-reality feature.

Starbucks is now building more net new company-operated stores in China than the USA, said CEO Kevin Johnson, who replaced CEO Howard Schultz in April when the longtime leader transitioned into the role of executive chairman.

Joshua Trujillo  Starbucks
Joshua Trujillo Starbucks

Starbucks is looking to leverage its huge growth in China, which is now the brand's fastest growing market, where a new store opens every 15 hours.

In 2012, Starbucks China has operated the China Starbucks Farmer Support Center in Pu'er in the Yunnan Province, supplying agronomists to work in concert with government representatives and local farmers to improve quality and production through the region.

Starbucks "partners" work at the Teavana tea bar in the new Starbucks Roastery in Shanghai, China.

Same-store sales at U.S. cafes were up 2% for the quarter ended 1 October, while sales in China were up 8%. Starbucks already operates more than 3,000 stores in the country and 2,000 more by 2021. Princi is the exclusive food offering in all Starbucks Roastery locations, including Seattle, Shanghai and upcoming locations. In the fiscal year 2017, Chinese sales grew by 7 percent, while global sales grew by 3 percent. The company announced plans in July to buy out its partners in its Each China joint venture, for US$1.3 billion.

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