Magellan Talks Starbucks

By Tim McGowen | More Articles by Tim McGowen

Irrespective of what you might think about their coffee, one fact cannot be denied: with 29,000 stores around the world, a premium personalised product, an extremely loyal customer base, and an enviable balance sheet, Starbucks is a global corporate force to be reckoned with.

And, according to Magellan’s Rosie Malcolm, this looks set to become even more the case over the next few years.

Take, for example, the Chinese market. Consider the following statistics:

  • The average US consumer drinks around 300 cups of coffee a year
  • The average Chinese consumer drinks less than 1 cup of coffee per year
  • In America, there are currently 14,500 Starbucks stores, roughly 1 per 20,000 people
  • In China, there are currently 3,300 Starbucks stores, roughly 1 per 500,000 people
  • The Chinese middle class is forecast to double in size over the next 5 years

With anomalies such as these it’s unsurprising that Ms Malcolm sees China as a “multi-decade growth opportunity” for Starbucks.

Some other points raised in the video:

  • Starbucks’ place in the consumer mindset
  • Recent changes to their loyalty plan and digital relationship with both new and existing customers
  • Starbucks and Nestle
  • Cost-cutting initiatives and corporate actions
  • Potential risks for the company

Rosie Malcolm joined Magellan in 2017 as an Investment Analyst in the Franchises team and in 2018 was made Head of Franchises. Rosie, who has over 20 years’ experience in investment markets, holds a Bachelor of Business from the University of Technology, Sydney, majoring in Accounting and Finance. She achieved Honours in Finance and was awarded the University Medal. She has been a CFA Charterholder since 2003.

Tim McGowen

About Tim McGowen

Tim McGowen is the co-founder of He was previously the founder of Fortitude Capital the Hedge fund of the Year in 2008 & 2009. More recently he was a global Portfolio Manager for PM Capital.

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