Starbucks’ Russia exit opens expansion opportunities in Asia: report

Starbucks followed Mcdonald’s move to withdraw operations in Russia. 

The move of fast-food giants, such as Starbucks and Mcdonald’s, to exit the Russian market could bode well for Asia, GlobalData reported.

“After leaving Russia, both brands have the opportunity to rapidly expand their outlets in Asia,” GlobalData Consumer Analyst Ramsey Baghdadi said. 

Baghdadi said this comes as businesses recognize the negative impact of its affiliation with Russia. 

In a report, GlobalData found that 72% of purchases across the globe are driven by ethics or support for social causes. 

“These companies have shown dedication to balance consumer expectations and their operational needs – a bold move that is sure to pay off,” Baghdadi said. 

He noted that the pull-out is considered “ultimately a low-risk gambit” as Russia accounted for a minimal share of sales.

This gives the 72% share of consumers who value ethics and social causes, and are likely to boycott products, a heavier weight. 

“The next challenge is in finding new high potential markets that can offset the losses from Russia,” he said. 

“McDonald’s for example should take advantage of its presence in other markets such as Japan and France, and Starbucks has seen strong growth in Thailand and Indonesia.”