Starbucks raised the prices for some beverages and meals in China by $0.16 to $0.32 on Wednesday, for the first time in over three years, WSJ reported.
Starbucks’ sales in China have slowed in recent months, and several factors, including operating costs, influence the company’s pricing selections.
Starbucks said Thursday that it raised prices on some beverage and food products in China and that its pricing decisions are based on many factors, including operating costs.
AP quoted CEO Kevin Johnson saying Starbucks stores in China were affected by COVID, with some store sales falling by 14% as sales were hampered by less overseas travel and low traffic to office buildings. At the end of December, Starbucks said that 75% of their locations in China were closed or had limited hours.
The decision was made amid the American coffee giant facing criticism on Chinese social media.
According to Reuters, a Weibo user said on Monday that a group of police officers was eating outside a Starbucks store in the southwestern city of Chongqing before being told to leave by staff.
The incident quickly went viral on the Twitter-like platform, and Starbucks was labeled as arrogant in a commentary by the Chinese People’s Daily newspaper.
However, the company answered that their staff had never attempted to file a complaint against police officers or chased them away.
Starbucks has apologized for “inappropriate communications” regarding its store incident in China, claiming that it resulted from a miscommunication.
This is the second public outcry in China in less than three months after an incident at one of its stores that the company described as a misunderstanding that drew online users’ criticism and official media attention.
The Beijing News reported last December that one Starbucks location used expired matcha liquid to make lattes, while another sold pastries that were supposed to be thrown out. After that, Starbucks conducted inspections and staff training across its nearly 5,400 locations.