Competitors of Starbucks (Competitor analysis of Starbucks)
This article aims to explore the main competitors of Starbucks in the USA, the UK, China, and India. Starbucks is the largest coffee house chain in the world. It is an American company, headquartered in Seattle, Washington. Its journey began in 1971 and it entered the European market in 1998 (Starbucks Corporation, 2020). It operates in around 80 countries and territories and has over 31,000 stores.
Competitors of Starbucks in the USA
Starbucks is the market leader in the USA in terms of number of outlets. According to Lock (2020) it has approximately 14.88 thousand stores in the country. Its nearest competitor is Dunkin which has over 9.5 thousand stores. JAB owned brands such as Pret a Manger, Peet’s Coffee, and Caribou Coffee also put considerable pressures on Starbucks. It is worth noting that coffee is one of the most widely consumed beverages in the USA. An average American coffee drinker consumes more than 2 cups of coffee per day.
Competitors of Starbucks in the UK
Costa Coffee is the UK’s leading coffee shop chain. Other competitors of Starbucks are Pret A Manger (Europe) Ltd and Caffe Nero. Cafes & coffee shops industry in the UK is expected to grow in the next few years, though the growth may be affected by the country’s exit from the European Union (EU) and economic lockdown. The UK is mostly a tea-drinking nation; however, over 95 million cups of coffee are consumed every day that are bought mostly from coffee shops and coffee vending machines. In fact, the UK is the 5th largest coffee consumer market in Europe (Caki, 2020). Therefore, it is a very important market for Starbucks.
Competitors of Starbucks in China
The business of Starbucks went unchallenged for many years in China. The nearest competitors were McDonald’s and Costa Coffee. However, things have changed dramatically recently. The home grown Luckin Coffee (founded in 2017) has opened thousands of outlets with many of them being situated within a five-minute walk from a Starbucks outlet (Robinson, 2019). It appears that it is growing and promoting itself aggressively to pose a serious threat to Starbucks in the country.
Competitors of Starbucks in India
A number of coffee house chains are competing in India and giving Starbucks a very hard time. Starbucks is growing rapidly and expanding its operations in many cities; however, it is strongly challenged by Cafe Coffee Day, Indian Coffee House, Barista Cafe and Restaurant, Costa Coffee, Brewberrys Café, Cafe Mocha, Gloria Jean’s Coffees, Café Amul Franhise and Georgia Coffee (Aditya, 2020).
Coffee market is extremely competitive in India. India is a famous coffee producing country where coffee is one of the most popular beverages. No wonder why the competition is so ferocious! Coffee business is growing rapidly, and the industry is appealing to both young and old customers very well.
Starbucks competitors’ market share
Brown (2019) reports that Starbucks maintains a massive 40% market share in the U.S. coffee shop market. It is followed by Dunkin that has 26% market share. In the UK, Costa Coffee has approximately 39% market share. Costa Coffee, Starbucks, and Caffe Nero together have 53% market share. It is worth noting that Costa Coffee is a subsidiary of The Coca-Cola Company.
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Last update: 11 August 2020
Brown, N. (2019) Nearly Four of Every Five US Coffee Shops are Now Starbucks, Dunkin’ or JAB Brands, https://dailycoffeenews.com/2019/10/25/nearly-four-of-every-five-us-coffee-shops-are-now-starbucks-dunkin-or-jab-brands/ (accessed 10 August 2020)
Caki, S. (2020) The economic impact of the coffee industry, available at: https://www.market-inspector.co.uk/blog/2019/09/uk-coffee-market (accessed 02 August 2020)
Lock, S. (2020) Coffee chain market share in the U.S. as of October 2019, by number of stores, available at: https://www.statista.com/statistics/250166/market-share-of-major-us-coffee-shops/ (accessed 06 August 2020)
Robinson, B. (2019) Starbucks-Luckin competition heats up, available at: http://www.chinadaily.com.cn/a/201905/01/WS5cc9b0c8a3104842260b97b4.html (accessed 01 August 2020)
Starbucks Corporation (2020) Company Information, available at: https://www.starbucks.co.uk/about-us/company-information (accessed 10 August 2020)
Author: Joe David
Joe David has years of experience both in the UK and abroad. He writes regularly online on a variety of topics. He has a keen interest in business, hospitality and tourism management.