Starbucks donates $1.5 million to school charity
Published: February 14, 2006
Starbucks Corp. on Tuesday announced a $1.5 million donation to train grade school teachers in China, raising its profile in what chairman Howard Schultz said is the gourmet coffee chain’s No. 1 growth market.
The donation is the first from a $5 million fund announced earlier by Seattle-based Starbucks for charity projects in China. The company opened its first Chinese outlet in 1999 and now has 220 locations in 18 cities.
“No market to date potentially has the opportunities for us that China ultimately will,” Schultz said after a ceremony at the Great Hall of the People, the seat of China’s legislature, to announce the school donation.
“We have significantly moved China up to the No. 1 priority in our company,” he said.
Schultz wouldn’t give any details of expansion plans but said the company is still in an “embryonic state” in China. Its chief financial officer, Michael Casey, said this month that he expects China could one day have several thousand Starbucks.
Also at the donation ceremony were officials of China’s legislature and the Soong Ching-ling Foundation, a Chinese children’s charity that is Starbucks’ partner in the school-training program.
The program is to train 3,000 schoolteachers from China’s poor west and to provide books and computers for their schools.
Schultz said that after some early unease about opening in a society known for drinking tea, Starbucks has been even more successful in China than it hoped.
Its coffee - going for as much as $6 a cup - costs more than the average Chinese worker makes in a day.
But the success of Starbucks outlets in provincial cities such as Chengdu in the southwest and Dalian in the northeast shows “we have an opportunity well beyond the major cities,” Schultz said.
Starbucks’ success in China has prompted a flock of imitators, some of which the company accuses of pirating its brand name and logo.
The company won a round in December, when a Shanghai court ordered a local coffee house to stop using the name Xingbake - the Chinese name of Starbucks.
The company is pursuing cases against other copycats, said Wang Jinlong, the president of Starbucks Greater China. He said there were “many” but wouldn’t give any details.
As courts crack down, he said, “We’re confident there will be less and less in the future.”
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