In areas such as Shanghai, teahouses are a more common (and also more traditional) alternative to coffeehouses. They're cheaper than Starbucks, they also sell beer and soft drinks, and they're happy to let customers smoke -- unlike Starbucks, says French.
However it fares, China has become strategically important enough to Starbucks that the company cited potential stumbles there among the risk factors in its 2005 annual report. Those risks include deterioration in U.S.-China relations, legal uncertainties and intellectual-property ripoffs. (Earlier this year, Starbucks won a lawsuit against a Shanghai coffee company that was using the Chinese version of Starbucks' name and a similar logo).
Starbucks has refused to say how many stores it plans to open in China. But in October, CEO Jim Donald said the company has raised its long-term store target to 40,000 locations around the world, up from its earlier goal of 30,000.
About 10,000 of those new stores will be in Asia. And with China being billed as the next big market for Starbucks, expect it to get a lot easier to find a cup of coffee in the Middle Kingdom.