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A Reuters-Tokyo/Yahoo! Finance article published today states that Maria Mercedes M. Corrales, the new CEO of Starbucks Coffee Japan Ltd (Osaka: 2712) aims to open at least 100 stores a year. A targeted end date was not specified. This strategy doesn't exactly make sense to me since Starbucks Japan just achieved its first year-over-year same store sales increase in five years for the year ended March 31st.

A "local" strategy it implemented last year has paid off nicely so far but why ruin a good thing by putting pressure on the firm to expand at that rate compared to its 50-75 new store range over the past two years. Starbucks Japan currently has 624 stores.

Starbucks Japan could turn into a McDonald's Japan (JASDAQ: 2702) where it becomes more of a commodity rather than a specialty if it's on every street corner. There are two interesting issues however: (1) having a Starbucks on every corner means you might actually be able to grab a seat with your cup of coffee but (2) if you are a smoker you probably won't choose smoke-free Starbucks anyway.

I guess we'll have to wait and see how the store expansion goes.

Starbucks Corp (SBUX) owns 40% of Starbucks Coffee Japan.

Starbucks Corp (SBUX) and Starbucks Coffee Japan Ltd (Osaka: 2712) 1-year chart:



Source: Starbucks' Overly Ambitious Plan in Japan (SBUX)