The planned 12,000 new stores: This is how Starbucks intends to open them.

On April 8, Starbucks China announced the official start of a new chapter in its development, with its strategic cooperation with Boyu Investment now fully underway.

A few days earlier, on April 2, the joint venture transaction between the two parties had just been officially completed. According to the terms of the agreement, Boyu Investment will hold up to 60% equity in the new joint venture, while Starbucks will retain 40% and continue as the owner and licensor of the brand and intellectual property.

This means that around 8,000 directly operated stores currently managed by Starbucks in China will gradually transition to a franchise model, with plans to expand the total number of stores to 20,000.

After spending more than ten years regaining control with a “fully self-operated” model, Starbucks is now returning to “franchising.” This is arguably the most significant strategic overhaul in Starbucks’ 27-year history in China, starting a whole new era for the company.

Facing fierce market competition, the restructured Starbucks China has played a new card—“one thousand stores, one thousand faces”—seeking to “exchange control for speed, exchange localization for scale,” in hopes of regaining initiative in lower-tier markets.

Targeting 20,000 Stores

With the joint venture established, Starbucks China's ambition for expansion is more evident. Public disclosures show the two sides have set a long-term goal to expand Starbucks China's total store count to 20,000.

How will such a massive store expansion plan be supported? Starbucks China CEO Wangjuan Liu’s answer is the “one thousand stores, one thousand faces” strategy. Specifically, this strategy covers five key initiatives: professional coffee as the first choice, high-quality product innovation, scenario-based store expansions, building “one store, one community,” and AI-assisted cultural connections.

For store expansion, Liu gave clear targets: Starbucks stores already cover more than 1,000 county-level administrative areas, and in the next three years this will increase to over 1,500. Even in Shanghai, which already has more than 1,100 stores, Starbucks China plans to seek new commercial district opportunities.

Store formats will also become more flexible and diverse. As disclosed at the event, Starbucks China will adapt various store types to different scenarios—from the smallest 10-square-meter stores and coffee carts at concert venues, to modular convenience stores in office buildings, as well as over 800 Reserve and themed stores.

In terms of products and coffee expertise, Starbucks China has launched “Chun He Jing Ming,” a light-roast coffee bean customized for the Chinese market. Additionally, Starbucks will invest in new brewing equipment in over 1,000 office-area stores, launching the “Freshly Brewed Daily” coffee series. For talent development, a “regional coffee master” career path is formally established, with one dedicated regional coffee master assigned to each operations manager area.

In community operations, Starbucks’ community spaces have hosted over 15,000 events, including handicraft, pet, cycling, running, and more. Store partners will be granted more autonomy, including customizing store music playlists, organizing events suited to their stores, and the chance to include original specialty drinks in the digital menu.

AI technology is also included in the strategic framework. Starbucks China announced the launch of “1,000 AI Chief Growth Officer Program,” providing smart marketing support for every store, and upgrading store manager AI assistants to handle operations such as ordering and scheduling.

Entering the Joint Venture Era

To understand why Starbucks is willing to relinquish absolute control of its China business, one must examine the severe challenges it has faced in recent years.

According to Euromonitor International data, Starbucks' market share in China declined due to the aggressive low-price strategies and rapid expansion of local coffee brands. Facing consumers’ ever-evolving demands at “China speed,” the traditional decision-making mechanisms of multinational companies increasingly struggle to keep up.

Boyu Investment’s entry is a key move to shore up Starbucks’ localization shortcomings.

At the Starbucks China Partners Forum, Boyu Investment partner Huang Yuzheng clearly expressed his position as an “empowerer.”

He pointed out that Boyu has invested in more than 200 companies in the past 15 years, establishing strategic collaborations with numerous Chinese local businesses. This deep business network and site selection resources will directly help Starbucks “open new stores in areas not yet reached,” and connect Starbucks with digital and AI capabilities.

Regarding the division of roles, Huang Yuzheng’s statement was measured: “Boyu is here to provide assistance, enablement, and lay the foundation for long-term success.” He also emphasized, “Ongoing operations will still rely on the Starbucks management team.”

By introducing an institution with rich private equity and infrastructure investment experience, Starbucks has essentially found a strong, local operator.

Notably, at the forum, Liu Wangjuan responded first not to store targets or strategy, but to internal employee concerns about changes following the joint venture.

She stated clearly: “Recently, partners have asked me whether the most important KPI in the future will be store count? Will capital entry change Starbucks’ brand positioning? There’s no need for such anxiety— we will stick to our original intent, maintaining orderly and steady development. Our strategy will focus more on customer needs and partner empowerment.”

Liu further revealed that Boyu Investment and Starbucks will share a long-term incentive plan based on the principle of “sharing success” to the public in the fourth quarter of this year. Existing benefits policies will continue, and programs such as Star Light and Star Glory will still drive partner development and advancement.

With closing completed, the battle is fully underway. Starbucks Global CFO Cathy Smith said China remains a crucial part of Starbucks’ global business, and an important source of global innovation. However, this complete shift from direct operation to franchising and the rush toward a massive 20,000 stores is not without concerns.

An important context is that the competitive landscape of China’s coffee market has changed significantly. By the end of fiscal year 2025, Starbucks China had 8,011 stores, while Luckin Coffee has surpassed Starbucks in terms of both store count and revenue. Other local brands such as Cudi Coffee are also continuously expanding.

For post-joint venture Starbucks China, the core challenge will be how to achieve the long-term goal of 20,000 stores while maintaining brand tone.

From about 8,000 directly operated stores to 20,000 franchised stores, from standardized replication to “one thousand stores, one thousand faces,” Starbucks China is completing a profound strategic transformation.

The story after the joint venture has only just begun.

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