Issue link: https://read.dmtmag.com/i/641418
48 STiR tea & coffee industry international / Issue 1, 2016 (February/March) all firmly established in the Thai market. More cof- fee enthusiasts evident among Southeast Asians as third wave of coffee becomes established in key markets, encouraging growth in emerging markets Café culture in Southeast Asia is seen as aspi- rational and this is fuelling the sector, particularly among younger consumers who are influenced by international branded chains. Consumers are now more knowledgeable about speciality and good quality coffee, which is also driving the sector alongside the development of a strong artisan cof- fee shop scene in key markets including Singapore, Malaysia, Taiwan, and Thailand. This market is less developed in Hong Kong, China, the Philippines, and Indonesia but a third wave scene is emerging. Beverage localization is also important, with green tea lattes and Starbucks Asian dolce latte popular drinks with Asian consumers. However, consumers are also looking for the Western expe- rience and this means that a Western beverage and food offering is essential for international chains. The region's hot climates mean that iced bev- erages are the most popular, with an 80:20 share of total beverage sales, except in Singapore where hot beverages are more popular due to the expat demographic. Tropical flavors and seasonal drinks are enjoyed, e.g. operators will incorporate mango into drinks when it is in season. Asian consum- ers also prefer exceptionally sweet food and drink, which can be seen by Starbucks' dose of 22ml of syrup in Asia compared with 4-5ml in the West. Most Asian countries do not use fresh milk in their beverages. Traditional coffee drinks are usu- ally made with condensed or evaporated milk, but espresso-based beverages will be made with fresh milk where available. Allegra predicts that the Southeast Asia brand- ed coffee shop market will exceed 24,000 outlets by 2020, representing overall growth at 11%. There will be some consolidation, with weaker brands closing more outlets as international chains become more dominant, but there are exciting growth op- portunities for chains in brand-embracing markets such as Indonesia and Malaysia. The Project Café Southeast Asia report is available for purchase from Allegra Strategies World Coffee Portal Ltd. Belinda Wong with Partners in China Alibaba Group chair Jack Ma and Starbucks c.e.o. Howard Schultz at China Partner Family Forum Starbucks has been in China for nearly 17 years. In the last 3 years, Starbucks has more than tripled its store count in China. This year 1 store opened every 18 hours. When China's President Xi and Madame Peng visited Seattle and Washington, D.C., in September, Belinda Wong, president of Starbucks China shared the experi- ence with her partners: "It was an emotional experience listening to President Xi share his hopes and dreams for China and the Chinese people. I am committed to ensuring that we at Starbucks will do everything possible to help you achieve your personal and career aspirations." Wong will meet with more than 1,300 China partners and their families in January 2016 for the company's 4th Partner Family Forum in Chengdu, China. "We're trying to build a different kind of company in China and are mindful of how we grow while maintaining the heart and soul of what Starbucks stands for," said Wong. "Growth has to be built on the foundational values of Starbucks," she said. Wong was recognized for her leadership in 2015 by Forbes as one of the Top 100 Chinese Busi- ness Women. Wong also made Fortune magazine's list of 25 Most Influential Business Women in China for the 4th consecutive year. In January Howard Schultz, chairman and c.e.o., Starbucks Coffee Company re- affirmed the strategic role of the China market in shaping the future of the company with the announcement of several market-leading initiatives, further elevating the unique Starbucks experience for partners (employees) and customers. Schultz joined other company leaders in Chengdu where they hosted more than 1,300 Central and Western China region partners and their family members, sharing the Starbucks mission and values. Schultz praised their efforts in celebration of the 2,000 store milestone. "As Starbucks second largest and fastest-growing market globally, China represents the most important and exciting opportunity ahead of us," said Schultz. "We are deeply humbled by the enthusiasm with which Chinese people have embraced Starbucks as part of their daily ritual over the past 17 years. Over time, it's conceivable that China could become our largest market and I am grateful to our 30,000 dedicated China part- ners and their supportive families for the significant contributions they are making to Starbucks success. The continued investments we are making, coupled with the culture of innovation we have established, are elevating Starbucks partner and customer experi- ence beyond that of any other retailer in China." Joining Schultz on stage at the Partner Family Forum was Jack Ma, founder and executive chairman of Alibaba Group, where both leaders shared their vision to rede- fine the roles and responsibilities of a for-profit public company – one that invests in its people, giving back to the local communities in meaningful ways, and creating unique developmental opportunities for the youth of today. In his introduction of Ma at the Starbucks China Partner Family Forum, Schultz said, "When he and I get together we're talking about common values and we're talking about humanity. Together building the kind of companies our parents would be proud of. I asked him to come here and share with you his thoughts about building his company and share with you what it means to succeed against all odds in China." In addressing the Starbucks Partner Family Forum Ma said, "Alibaba hopes to work together with Starbucks to create even more opportunities to develop Chinese youth because they are our future. All of you at today's event represent China's future. The more seeds of love we sow in our Chinese youth today, the more love they will give to the world tomorrow."