Starbucks starts work on $170m “coffee innovation park” in China

US coffee house Starbucks has begun work this week on a $170m first phase of its "Coffee Innovation Park" in the Chinese city of Kunshan, in the western outskirts of Shanghai.

The 80,000-sq-m park is located in Kunshan’s economic and technological development zone, and according to Starbucks it will be its greenest-ever coffee roasting facility, using 30% less energy than a traditional plant of the same size.

The development reflects the growing importance of the Chinese market to the Seattle company; it is its second largest, and sales there grew 7% year-on-year in the latest fiscal quarter, whereas they fell 9% in the US.

The chain now has more than 4,700 stores in nearly 190 cities in the Chinese mainland and set a new quarterly store-opening record in the three months to the end of September. In the period, Starbucks opened 480 stores worldwide, 259 of which were in China.

In 2017, Starbucks opened its flagship "Reserve Roastery" in Shanghai (see further reading) (Starbucks)

The scheme, which was announced back in March as a $130m investment, will be Starbucks’ second production facility outside the US – the only other is in the Netherlands to supply the European market.

The Kunshan zone was set up in 1985 and now hosts around 2,360 foreign-owned companies from 51 countries, who have brought with them a total investment of about $40bn in industries such as photoelectric semiconductors, electronic information, intelligent equipment and electric vehicles.

Starbucks’ project will further the zone’s aim to become the main manufacturing, sales and distribution hub for coffee beans in the Asia-Pacific region.

Top image: Duke Kunshan University, a joint development of Duke and Wuhan universities. Kunshan, best known to tourists for its canals, has become a high-tech industry hub. (Crcolas/CC BY-SA 4.0)

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