Well-known British coffee brand Costa faces tough competition after opening three cafes in Shanghai in the last two months, its first foray into the Asian market.

"China is providing a growing market for us to promote our brand and get continuously stronger," said Matthew Holgate, general manager of Yueda Costa (Shanghai) Food & Beverage Management Co Ltd, a joint venture between the Whitbread Group and Yueda Group, a diversified conglomerate based in Jiangsu Province. "Shanghai is taking the leading position in Costa's development strategy in Asia," Holgate added.

Costa faces stiff competition from the well-established foreign chains, notably Starbucks of the United States, and illy and Lavazza, both from Italy. Costa opened its first cafe in the Nanjing Road shopping area on December 22. Since then, the company has opened two more cafes, one in Guobin Road and the other in Zhenguang Road.

The company also hopes to set up several hundred more outlets in the coming three to five years, according to Holgate. This year it plans to expand its network to other cities including Chengdu, Nanjing and Hangzhou. Local operators' familiarity with the market will facilitate the development of foreign brands, according to Holgate.

Costa is trying to position itself in the China market as a purveyor of superior coffee, providing customers with a traditional European experience. Though British in origin, Costa markets itself as a refined, up-market Italian alternative to US giant Starbucks, which entered China almost eight years ago. Starbucks now has more than 180 outlets in 14 cities throughout the country. Starbucks has claimed nearly all the choice locations in Shanghai, adding more than 20 outlets in 2006. Starbucks plans to take on its competitors by increasing its total outlets in China to 500 in the next five years.
 

Source:未知