Coffee giant's plans stir up Guiyang

The planned entry of Starbucks to Guiyang, Guizhou province, in May has stirred the local coffee market.

Starbucks, a Fortune Global 500 company, plans to open its first cafe in the capital city of Southwest China's Guizhou province. Four to five cafes will open later in the year if the first performs well.

Starbucks is eying Guiyang's potential market for coffee, the annual sales volume of which is estimated at 50 million cups.

Guiyang's first cafe opened in 1995. There are now more than 400 cafes in the city, but two-thirds are losing money, while the rest make meager profits.

"It's hard for us to go on if we just sell coffee, so we also sell desserts, other drinks and books," said a storekeeper at Coffee Reading in Guiyang.

Luo Huaiyong, the owner of Soil Cafe in the city, said he sees the imminent arrival of Starbucks as a threat, and worries that the city's market is too small to accommodate such a giant.

"Maybe I will give up my cafe soon," Luo said, adding that he feels hopeless about Starbucks' plan.

Morgan Coffee, on the other hand, plans to expand the local market by developing one or two experience centers in Guiyang, providing customers more information on the coffee culture.

Morgan Coffee sells about 500,000 cups of coffee each year, serving almost 80 percent of Guiyang's cafe customers.

"The coming of Starbucks sends a positive signal rather than a negative one to Guiyang's coffee market," said Liu Jie, who has worked in the coffee industry in the city for more than a decade.