Starbucks Plows Forward With $130 Million Roastery in China

(Bloomberg) -- Starbucks Corp. is spending $130 million on its first coffee roasting facility in China, a sign the chain is getting back to normal in the country after shuttering thousands of stores earlier this year as the coronavirus spread.

The plant is part of Starbucks new coffee innovation park slated to open in 2022 in the city of Kunshan, an hour from Shanghai, it said in a statement.

The virus outbreak brought most of Starbucks’ Chinese operations to a halt earlier this year with about 80% of its 4,300 stores closing in early February. Now, almost all of those are up and running with elevated safety measures in place, according to the company. Starbucks has made China -- as well as the U.S.-- central to its growth plans.

On Thursday, Chief Executive Officer Kevin Johnson said he’s prepared to take similar measures in the U.S. -- closing cafes and limiting seating -- to contain the virus that’s sickened more than 120,000 globally.

The world’s biggest coffee-shop company last week also reassured investors that the virus impact would be temporary, but said second-quarter profit would take a hit by as much as 18 cents a share. Seattle-based Starbucks shares have dropped about 29% so far this year.

To contact the reporter on this story: Leslie Patton in Chicago at lpatton5@bloomberg.net

To contact the editors responsible for this story: Anne Cronin at acronin14@bloomberg.net, Sally Bakewell, Jonathan Roeder

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