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Coffee chains brew robust future in China

From Best Buy to B&Q, many foreign brands and business models have struggled in China. But perhaps the least likely western retail concept of them all has prospered the most: foreign coffee shops.

Despite a history of thousands of years of tea-drinking in China, coffee chains from the US, UK and South Korea are expanding rapidly and coffee shop sales are growing faster than almost any mainland retail segment. According to figures from Euromonitor, coffee chain sales have risen from under Rmb10bn ($1.6bn) in 2008 to more than double that last year, with sales expected to double again by 2017.

Starbucks, the US coffee chain, virtually created modern café culture from scratch in China, retail analysts say, pointing out that tea is not just the country’s most popular drink, it is also deeply embedded in Chinese culture.

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