Starbucks Shanghai War

Image Source @视觉中国

Image Source @视觉中国

Text | Miss XY


Shanghai is already a city surrounded by Starbucks, nearly 700 stores, the world's first.

"The paradise of the rich, the paradise of petty bourgeoisie, the goal of the proletarian, the dream of the lower Riba, the hell of the poor." Shanghai is the best testing ground for consumption, the paradise for adventurers. Starbucks values ​​China more than ever, and believes that you can read Shanghai more than ever. But in the past 19 years, Starbucks Shanghai has given another answer.


Starbucks did not believe in Shanghai at first.


But when Starbucks opened, these were already a thing of the past. Shanghai appears to be crowded and run down, and the ruling party is coping with many intuitive urban dilemmas, such as solving 800,000 briquettes and 800,000 toilets in the alley. Hongqiao Airport is still a remote place; there are not many buildings from Xuhui in the past; the bus passes through Zhongshan Park and can pass through a large shanty town; Zhangjiang also has a flood of paddy fields and planted many red diamonds.

Howard, then Starbucks CEO. Schultz flew from the United States to Shanghai to attend the ribbon-cutting ceremony. He was dressed in a black suit, white shirt, demeanor, and stood with a few bright-faced, green apron-clad Chinese girls, and the corners of the walls filled with curious Shanghai citizens.

All the spotlights are focused on this Jewish businessman with a high nose and deep eyes. What is less well known is that bringing Starbucks into Shanghai is a low-key Taiwanese, the founder of the Unification Group, HD. It holds a 95% stake in Shanghai Starbucks, while Starbucks only accounts for 5%.

A year ago, China's first Starbucks opened in Beijing, with speeches, dragon and lion dances, but no Starbucks executive was present. Starbucks authorized Beijing Meida Coffee to operate stores in North China, the United States Starbucks does not occupy, South China is also the same.

As an American, Schultz was hesitant about a tea-based socialist country. The first to understand China's reform and opening up is the Taiwanese. But many of the things that seem natural today begin with almost a gamble.

Gao Qingyong and Schultz have a similar path of life, born at the bottom, but with outstanding business talent, through personal struggle, achieved a class transition, creating a business kingdom.

Schultz grew up in the slums of Brooklyn, his father was a blue-collar worker, and he was unemployed during his mother's pregnancy. He is fed up with the days of poverty and fear of poverty, and the genes in his blood that are eager to make money.

Gao Qingyi's father, who sells cattle for a living, died of tuberculosis at the age of 13. In order to make a living, Gao Ching-ching would like to go to other people's just collected sweet potato fields to pick up some scraps of the root to go home. Soon after dropping out of primary school, he went to a grass shoe shop to work as a child worker, earning 15 yuan a month. A few years later, Gao wanted to enter Xinhe Xingbu, learn to do business, and began to showcase amazing business talents.

HD is willing to make a relationship with Shanghai. It dates back to 1947, and Xinhexingbu has expanded its business to Shanghai. However, only two years later, due to changes in the situation, the cloth was withdrawn and retired to Taiwan in the future.

This is half a century later. HD is willing to leave the cloth line and become the head of the unified enterprise. This small factory, which started from pig feed, has become Taiwan's well-deserved hegemon, with revenue second only to TSMC. The 711, Carrefour, and Starbucks all over the street are all related to the uniformity of iced black tea and instant noodles.

In 1991, Taiwan began to allow large companies to invest in the mainland. HD is willing to dispatch 166 elites to set up factories in the mainland. During Lee Teng-hui’s reign, HD is willing to be a loyal supporter of cross-strait three links. He insisted that the mainland market is vast, and it is an inevitable trend for Taiwanese businessmen to invest in the mainland. It is tantamount to burying the graves by Taiwanese enterprises.

Just in the year when HD was willing to take Starbucks into Shanghai, on the eve of the "Taiwanese election", he accepted an interview with The New York Times and boldly predicted that "A-Bian if elected, Taiwan stocks will fall to one-third", afterwards, Taiwan stocks really The price dropped to more than 3,000 points. The humble HD has always admitted that the pace of unification on the mainland was once slower than Master Kang, and how much should be blamed on the Green Camp. They are worried that these Taiwanese businessmen "have gone, people have gone, and their hearts have gone."

Under the control of Unification, Starbucks in Shanghai is very aggressive. In 2000, Starbucks did not open a single water test, but opened nine stores at a time. At that time, Shanghai people's average wage was only 1200, a 19-dollar latte is a real luxury.

Facts have proved that the Shanghai people did not let HD be disappointed. Unification used "miracle" to describe the development of its own business - it began to make profits after 21 months of opening, which is the first time in Starbucks' global history. In 2001, Shanghai Starbucks revenue reached more than 60 million, and the next year it exceeded 100 million. The number of stores in Shanghai has rapidly increased to more than 40.

Schultz later claimed that Starbucks had sustained a loss of nine years at the beginning of its entry into China. For Shanghai, this is somewhat spoiled.


The rise of Starbucks in Shanghai is almost destined, and it is exactly the same as its rise in the United States.


At the beginning of the development of Pudong New Area, the then Shanghai Mayor Zhu Rongji discovered that the reason why Hong Kong is developing well is because “because valuable things are in Hong Kong, it is the tertiary industry, including finance.” This face is cold and thin, and the name is in Shanghai. The mayor, who looks like a "rooster", decided to play the gold medal in the Shanghai tertiary industry. Shanghai is different from Beijing and Shenzhen.


At that time, Chinese Internet entrepreneurs crowded in Shenzhen, Zhongguancun, Hangzhou homes or broken office buildings. Shanghai's most advantageous financial, foreign trade, and service industries are the first middle-class industries to be born in China.

As early as 1994, Serenity starred in the release of Miss Orpheus, almost empty. The protagonists are all foreign-invested companies in Shanghai, and they live a good life – buying branded bags, going to bars, and sharing rich foreign boyfriends. If there were Starbucks at the time, the office sisters would be on the date, and the cup of green tea that was repeatedly brewed in the hand would be replaced with coffee.

In the process of growing up, a class needs to determine its own identity through economic, political, and cultural capital, and separate itself from other classes. As for the middle class, the cultural division is their usual method. They use their taste and consumption symbols to define their own class boundaries and distinguish themselves from the upstarts and the bottom of society.


The literary and art leader may not want to admit it today. In her early years, she wrote a love story about Starbucks. The woman is sitting in a fixed position every day, and she is eager to show off her books and notebooks that have been turned yellow in order to advertise their unique taste. She succeeded in attracting the attention of a handsome Starbucks barista wearing a white shirt and a green apron. The "home" of Anne's baby's heart turned out to be a coffee shop assistant.

Schultz likes to advertise Starbucks' "third space". There is no place like Shanghai at the turn of the century. It is more suitable to promote this concept, although its initial appearance is far beyond Schultz's understanding.

On Douban, a reader of Anne Baby told a story about her early years. She once wandered around a Starbucks in Beijing for a quarter of an hour, but she never had the courage to go in. At that time, she had three hundred bills in her pocket, so how could she buy a cappuccino? But she thinks she doesn't belong there because Starbucks is a symbol of life marked with the Metropolitan Imprint.

During the same period of Anne Baby's popularity, 18-year-old Guo Jingming first came to Shanghai to participate in the new concept and fell in love with the city. At that time, he had not eaten KFC, but it does not matter, the desire city quickly changed the simple Zigong teenager. Starbucks appeared in his "Little Times", a rich, handsome writer who loves coffee. Guo Jingming's wording is almost the advertising word - "the sweet smell of brown silk satin, and I am entangled every day, never give up."


In 2003, I saw the high-definition of profits, and further expanded the scope of authorization to Jiangsu, Zhejiang and Shanghai. In the second year, the first Starbucks outside of Guangzhou and Shenzhen went to Suzhou, and entered the neighboring Wuxi and Changzhou in the same year. As far as the United States, Schultz suddenly realized that the market in the shipping area was such a big piece of fat. Starbucks repurchased 45% of the shares from the unified hands. The price was very fair at the time, and it cost only 176 million yuan.

That is the golden age of unity. HD is willing to open the factory like a coffee shop to more than 100 cities except Qinghai and Tibet, and become a guest of the mainland political figures.


Gao Qingyao has always been very low-key, even in the business community in Taipei, he is also known as "no shadow man." The relationship between Starbucks and unification in Shanghai has been rarely mentioned for a long time. However, it has begun to become a unified printing machine. However, this is essentially a "service contract", the hidden dangers have been buried in the future.

In the autobiography "Happiness Coffee Time", HD is willing to recall, because he grew up in the Japanese occupation period, he only knows Japanese and Taiwanese. In order to do business with the mainland, he is still learning Mandarin after he is 60 years old. At the beginning of the speech, Chinese speeches were recorded in Japanese pseudonym.

In November 2005, the 74-year-old HD is willing to come to China to participate in the Global Chinese Business Leaders Summit. On a few occasions, he appeared in the vision of the mainland media. Dan Fengyan, the old man with gray hair, said in a Mandarin-speaking mandarin, "I just want to make the taste of the Chinese, and contribute the best things to more than one billion compatriots." "1.3 billion people, big space, opportunity More, re-investing in 10 years and 20 years is not enough."


Subsequently, Starbucks regained the management rights in the Beijing area and changed to direct sales. The intentions of the Americans are very obvious. The Olympics are just around the corner. Beijing is becoming more and more open, and the increasingly internationalized mood has matured enough.

But Starbucks doesn't understand China at all. At the same time, the Olympic Games aroused a national emotion that Schultz could not understand. Just as Starbucks was about to kick-start, Rui Chenggang threw out a blog post, "Please get Starbucks out of the Forbidden City," and issued a protest letter to the Starbucks president in his personal name.

The diplomat graduated from the Diplomatic Academy and was a fluent English-speaking CCTV presenter. He claimed to be the new CEO of Starbucks at the Yale CEO Summit and told him: "There is also a Starbucks in China's Forbidden City. I and my countless Chinese and foreign friends think that It is extremely inconsistent with the atmosphere of the Forbidden City in China, which is unsightly.” Yan Chenggang also emphasized that this sentence is spoken in English. “Let Jim not come to Taiwan somewhat.”

In July of that year, Starbucks fled the Forbidden City under pressure from public opinion. Eight years after entering China, Starbucks felt for the first time the subtleties of Chinese culture and social sentiment. Starbucks stores slowed in the next two years to reach a freezing point in 2009.

That was reversed by Schultz's return. In 2009, amid weak U.S. markets and blocked European growth, Starbucks was eager to seize the future of a fast-growing China.

Schultz flew to many cities and, at this turning point in history, instead of choosing Shanghai, went to Shenzhen in the south, where he held an employee conference. He decided to integrate into China in a more Chinese way. For example, build a dedicated Chinese management team, led by a Chinese chief executive, to plant coffee beans in Yunnan and provide work for local farmers.

That year, Starbucks also had a lace news, and Schultz met Ma Yun in Hangzhou and became a close friend. This small Chinese, who is also good at speech, and passionate, once said, "When I started my business, Starbucks was already a myth." "It sells not only coffee, but a way of life." In the Alibaba Brazilian Creek Park, there is also a Starbucks. Every year, the Double Eleven will be open all night, and the only one in the world.

Since then, Schultz will come to China every year, more diligent than any CEO. He appeared frequently on the list of banquets when Chinese dignitaries visited the United States, and was received by several Shanghai party secretaries, a well-rounded businessman who skilfully swung between Chinese politicians and businessmen.




In 2011, Schultz restarted the merger and acquisition of the Chinese market, recycling the management rights of South China, and became a direct operation. As one of the conditions for exchange with Hong Kong Maxim, Starbucks has transferred the management rights of Hong Kong and Macao to make the company wholly-owned.

It is quite puzzling that the stars in the Chinese market are clearly dominated by Shanghai. In 2014, there were more than 600 Starbucks in the shipping area, more than twice that of Taiwan. The gap is still pulling. Two years later, the number of stores in Jiangsu, Zhejiang and Shanghai reached 1,206, bringing an annual profit of 4.13 billion yuan to the unification. Don't underestimate the petty bourgeoisie, they buy and buy, and push Shanghai to the world's most cities in Starbucks.

It was late, but the wolf came. In 2016, Starbucks did the same thing. Some Taiwanese media have revealed some sad information, with Starbucks in the United States threatening to reclaim Starbucks in Taiwan in order to acquire a stake in Starbucks in Shanghai. In fact, as early as four years ago, Starbucks expressed its intention to withdraw the authorization to Universiade.

The unified executive revealed an episode. During the acquisition negotiations, the finance and lawyer liquidation teams of more than 20 people sent by the two sides conducted a few months of store accounting. It involves the transfer of employees, the renewal of storefronts, depreciation of equipment, valuation of future trends, and many other things.

After eight months of repeated estimates at a five-star hotel, both sides were unable to come up with a satisfactory price. In 2016, Mr. Luo, the son-in-law of Kao Ching-hsien, joined Starbucks president George Schultz at the Shanghai Caf é in 2016. Luo Zhixian's character and high-definition wish are similar, therefore quite appreciated. It is rumored that he often travels on red-eye flights, lives in the old community, lives simply, never plays golf, does not find himself as a sole governor, personally serves foreign investors, avoids suspicion of not buying houses built by his own group.


The $1.3 billion was finalized. This became Schulz's last acquisition and the fastest acquisition in Starbucks' history. After a long breath, he announced his departure as CEO of Starbucks and his intention to run for the US president in 2020. The news of the merger was announced by Luo Zhixian, and the unified stock price fell sharply.

Since then, all Starbucks Shanghai stories have nothing to do with unification. Just the year the merger began negotiations, Gao wanted to die. The family did not notify the unified board of directors, nor did the funeral invite a politician. Behind him, a generation of Taiwanese businessmen also closed the curtain.


Five months later, Starbucks Baking Workshop opened its doors in Shanghai's bustling Nanjing West Road Tagu Huihui. It is said that the Shanghai government to Starbucks "special approval", green light all the way. Starbucks spent less than a year importing, shipping, out-of-the-box inspection, installation and commissioning, saving at least 70% of the time and incalculable cost of at least three years of equipment import, shipment inspection, out-of-box inspection, installation and commissioning.

Opposite the baking workshop is the Friendship Store. In the 1980s and 1990s, this mall was only for overseas Chinese. Shopping can only be used for coupons. When I was renting in Shanghai last year, the driver said that he got some coupons when he was young, went in and bought some chocolates, and still feels light on the face. Now, the feng shui turns.

Schultz opened a global farewell trip, the first stop to choose Shanghai, taking advantage of the Starbucks plus (2700 square meters) to open. Schultz took a picture and stood with Chinese employees, wearing blue shirts, khakis, and mugs, a little older than 20 years ago, but still fascinated. He maintains a consistent lyric, claiming that the baking workshop is "a magic carpet carrying coffee, drama and romance."



Just as Starbucks is becoming more and more fast-fooded in the United States, this trend is also inevitable in China, and it will only come faster in Shanghai. When KFC and McDonald's could not let the Chinese aunts decently match each other, Starbucks could not let the young artists of the literature and art decently install X.

Anne Baby hasn’t been drinking Starbucks for a long time. She has lived a higher and more expensive life: going to the countryside to build a small house, shielding all the outside world, reading poetry, reading the Bible, drinking tea with friends. Chatting, taking landscape photos, writing calligraphy, and plucking the piano... As for Guo Xiaosi from Zigong, I have lived in the 700 million Republican villa in Shanghai. I can’t wait for the trash can at home to bring the LV logo.

Starbucks is not stupid. Like China's Internet companies, it is accelerating to run outside the Fifth Ring Road. During the Qingming holiday, I was surprised to find that Starbucks was opened in the high-speed service areas of Jiande and Jiaxing. It’s a tacit narrative that young people in the town get the world.

But this is a more Chinese, more complex and even more bizarre market. There, Starbucks may not be able to read China.


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