Starbucks is introducing a policy in China that requires customers to buy a drink or other product to use seating in its stores. The company concluded that paying customers were being inconvenienced and store operations strained as more people occupied seats for hours after bringing in cheap coffee from elsewhere, or stayed without ordering anything at all.
Starbucks' China unit said the new policy, which makes a purchase mandatory for customers using store seating, takes effect nationwide on the 22nd, Bloomberg reported on the 21st. Stores will also post notices explaining the revised rules.
The rule will not be applied uniformly to everyone, however. According to local media, delivery riders, passersby seeking shelter from rain, security guards working near stores and pregnant women — people who need a brief rest — may use the stores without making a purchase.
Since its early years in China, Starbucks has promoted its stores as a so-called "third place" where people can linger and socialize outside home and work. But as customers who had bought nothing occupied seats for long stretches, paying customers were often left unable to find a place to sit. Critics in China said it had become common to see people eating drinks or burgers bought at other coffee shops inside Starbucks stores, or sitting down to play mobile games without ordering.
Starbucks Shaken by Low-Price Rivals as "Third Place" Model Is Tested
Starbucks opened its first store in Beijing in 1999 and now operates about 8,000 outlets across China. It once enjoyed strong popularity in the Chinese market despite its relatively high prices, but its position has weakened as local chains such as Luckin Coffee have grown rapidly on the strength of cheaper offerings.
Luckin Coffee, which charges less than Starbucks, overtook its U.S. rival three years ago to become China's largest coffee chain. Consumers turning cautious about spending amid the economic slowdown is another drag on Starbucks. The company's China unit has posted declines in same-store sales for two consecutive years, and while sales showed signs of recovery this year, it remains uncertain whether the growth will hold.
Last November, Starbucks agreed to sell a majority stake in its China business to private equity firm Boyu Capital. The China business was valued at $4 billion at the time. The plan is to secure growth momentum by working with a local partner. The China unit also plans to continue investing in fiscal 2027, adding staff during peak hours, upgrading digital systems and key equipment, and remodeling about 1,000 stores on the Chinese mainland.
Prioritizing paying customers is not unique to China. Last year, Starbucks also scrapped a U.S. policy that had allowed people who had not bought anything to use store seating, outdoor areas and restrooms. Some worry, however, that restricting seat use could improve store efficiency while weakening the brand identity built around the idea of a "third place."