China Bashes Starbucks' Prices

State TV says prices are higher than US, UK

By Ruth Brown,  Newser Staff

Posted Oct 21, 2013 4:29 PM CDT

(Newser) – China has a Venti-sized problem with the prices Starbucks is charging in the Middle Kingdom. State-run TV broadcaster CCTV recently ran a 20-minute report called "Starbucks: Expensive in China," claiming that the espresso giant charges customers in China up to 50% more than it does those in the US, UK, and India, the Wall Street Journal reports. CCTV says a medium latte in China costs $4.40, compared to $3.20 in Chicago, or $4 in London, CNNMoney reports. "Starbucks has been able to enjoy high prices in China, mainly because of the blind faith of local consumers in Starbucks and other Western brands," the director of the Coffee Association of Shanghai says in the report, per Reuters.

But Starbucks says the report is inaccurate. It says the numbers used in the broadcast included figures from other Asia-Pacific countries, reports the Journal. And besides, comparing London and Shanghai is apples and oranges, as different markets have different labor, real estate, and commodity costs. Starbucks isn't the only company under scrutiny for treating its Chinese customers differently: CCTV has also criticized Apple for its warranty standards and customer service practices, and Volkswagen, which it says sold cars with bad transmission in China.

A tourist walks past the windows to an outlet of Starbucks at the Forbidden City in Beijing, China.
A tourist walks past the windows to an outlet of Starbucks at the Forbidden City in Beijing, China.   (AP Photo/Ng Han Guan, File)
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