>> Starbucks says they're teaming up with Alibaba in China to take their coffee on the road. On Thursday, the company launched a partnership with the Chinese E-commerce giant in a bid to show up sales in its second biggest market. The company has been facing stiff competition from local coffee startups who've gotten a head start.
They were ready bringing coffee to the customer's front door. The tie up will allow Starbucks to piggy back on Alibaba's extensive delivery network and take the fight to new players in China's coffee marketplace. Starbucks had been using a suite of local delivery services to get its coffee out the door.
But in June when the company flagged a coming deal with Alibaba it also said a government crackdown on those third party delivery services who's partly to blame for downturn in its own China sales. The two companies will collaborate across various businesses in the Alibaba empire. They include food delivery service Ele.me along with supermarkets and online retailers.
Starbucks will also collaborate with Alibaba's ubiquitous online payment platform AliPay. Alibaba's delivery service has three million registered riders and the new partnership will start with deliveries from 150 Starbucks stores in prime locations. Then expanding to over 2,000 stores across the country by the end of this year. That's according to a statement from the two companies.
China's growing cafe culture has offered Starbucks rich pickings in recent years. That says its US growth slowed mostly due to a highly saturated coffee market. Starbucks currently has 3,400 stores in China and plans to nearly double that by 2022.