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March 9, 2020

Covid-19 impact: Starbucks anticipates $430m hit to China revenue

US coffeehouse chain Starbucks said that the coronavirus (Covid-19) outbreak will decrease its revenue by up to $430m this quarter.


Visit our Covid-19 microsite for the latest coronavirus news, analysis and updates

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While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
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Follow the latest updates of the outbreak on our timeline.


US coffeehouse chain Starbucks said that the coronavirus (Covid-19) outbreak will decrease its revenue by up to $430m this quarter.

The American coffeehouse chain estimates that the impact will be temporary as several of its stores have resumed operations after they were closed in a response to the outbreak.

The company also assured its investors that operations in China are quickly getting back to normal.

However, the company noted that it is too early to determine the impact of the disease on its full-year results.

Starbucks said: “Although there are near-term financial implications, our long-term, optimistic outlook for the growth potential of Starbucks is undiminished.”

China is Starbuck’s second-biggest market after the US where it operates 4,292 coffee shops.

Last month, Starbucks announced that the company has started reopening Chinese stores with 85% of its network already operational.

At the end of this quarter, the coffeehouse chain said that store opening rates will reach approximately 95%.

However, some of the new store openings planned this year will be postponed due to the outbreak.

Recently, Starbucks decided to temporarily stop using personal and staying-in cups in the US and China as part of its efforts to contain the spread of the coronavirus.

Meanwhile, the Covid-19 death toll reached 3,650, with the number of confirmed cases rising to 107,671.

Free Whitepaper
img

What is the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry?

While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
  • Which multinational companies have been affected?
  • What is the effect of lockdowns on foodservice?
  • What is the effect of lockdowns on Chinese ports?
  • Spotlight on Shanghai: what is the situation there?
  • How have Chinese consumers reacted?
  • How might the Chinese government react?
  • What are the potential growth opportunities?
by GlobalData
Enter your details here to receive your free Whitepaper.

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