At a time when same-store sales are under pressure and competition intensifies, Starbucks (SBUX.US) China will launch “consumer seating” on October 22

The Zhitong Finance App learned that Starbucks (SBUX.US) requires customers to take a seat after spending in a Chinese store. This is one of its measures to revive the fiercely competitive mainland market performance. Starbucks China said on Wednesday that the new seat policy will take effect nationwide from October 22, and stores will post notices to inform customers about policy changes.

“We will continue to invest resources to improve the in-store experience and work with customers to create and maintain a warm 'third space' experience,” the company said in a statement.

In addition, according to its statement issued on WeChat, Starbucks China also plans to invest more in the 2027 fiscal year, including increasing manpower, upgrading digital systems and core equipment during peak periods, and refurbishing about 1,000 mainland stores.

At the time of the introduction of these adjustments, Starbucks is making efforts to increase the appeal of cafes while coping with increasingly fierce domestic competition. In November of last year, the chain agreed to sell a majority stake in the Chinese business to private equity firm Boyu Capital for a corporate value of 4 billion US dollars, bringing in local partners to help plan the next phase of growth.

Dragged down by fierce competition and price wars, Starbucks China's same-store sales declined in the past two fiscal years. Sales showed signs of recovery earlier this fiscal year, but as it transitions to a new shareholding structure, the business has yet to show a continued return to growth. Starbucks stopped disclosing China's results separately from the third quarter ending in June.

This change in seating policy is in line with Starbucks's move in the US last year. The company then reversed a policy that allowed anyone — even those not buying food or drink — to use its cafes, patios, and restrooms. Starbucks said the move was aimed at prioritizing paying customers and introducing a new code of conduct as part of CEO Brian Nichol's efforts to make the store more attractive.

Starbucks opened its first store in Beijing in 1999 and currently has around 8,000 stores in China. However, in recent years, its position has been under pressure. Low-cost local rivals, including Lucky Coffee, have rapidly expanded, and consumers are increasingly unwilling to pay premiums for foreign brands.

Three years ago, Lucky replaced Starbucks as the largest coffee chain brand in China thanks to drinks that cost less than Starbucks. As consumers become more cautious about non-essential expenses, Starbucks's larger, more expensive store model is also under pressure.