China is Starbucks’ 2nd biggest market, but sales are slumping. Here’s why.

• Starbucks’ comparable sales in China are slumping, with a 14% drop in the most recent quarter.
• Its then-CEO put it down to weak consumer spending and a coffee store “price war” in a July investor call.
• China is Starbucks’ second-biggest market but analysts question how well its format works in China.

new Chinese stores in the year to June 30. The chain has continued to grow in China “in the hope that there’s some market shakeout,” but in the short term, “it’s a pretty tough road that they’re going through right now,” Andy Barish, an analyst at Jefferies, said.