Chinese state media and Starbucks in battle over coffee company's prices
AFPBEIJING -- Starbucks has become the latest foreign firm to be roasted by China's state-run media, following a series of accusations it is overcharging consumers.
October 22, 2013, 12:06 am TWN
State broadcaster CCTV aired a seven-minute-long report criticizing the coffee shop chain's pricing in China, arguing that a tall latte in Beijing is more expensive than in London, Chicago and Mumbai.
The report on Sunday stated the price of a Beijing latte as 27 yuan (US$4.42), compared with 24.25 yuan (US$3.97) in London, 19.98 yuan (US$3.26) in Chicago and 14.6 yuan (US$2.39) in Mumbai.
It came after a stream of print stories attacking the Seattle-based firm, with the state-run Economic Information Daily accusing it of “profiteering.”
The China Daily newspaper last week took aim at the chain in an article headlined: “Starbucks can't justify high prices in China.”
The allegations come after U.S. tech giant Apple was subjected to a barrage of attacks earlier this year over its warranty policy and customer service, which state media cited as examples of its “unparalleled arrogance” toward Chinese consumers.
The criticism stopped after Apple CEO Tim Cook apologized.
Foreign baby formula and pharmaceutical firms have also recently been targeted by authorities over allegations of price-fixing and corruption.
In a statement, Starbucks said that its pricing in different cities is based on a variety of factors, including infrastructure investment, real estate, currency valuation and labor costs.
“Each Starbucks market is unique and has different operating costs, so it would be inaccurate to draw conclusions about one market based on the prices in a different market,” the company said.
Starbucks opened its doors in China in 1999 and now has more than 1,000 stores in the country and growing, making China likely to overtake Canada as its second-largest market after the U.S. next year.