food / travel

Starbucks 'Creative' Cup Sizes Shake Up Customers In China

Starbucks in Shanghai
Starbucks in Shanghai
Shun Tao

BEIJING — If you've ever had trouble ordering at Starbucks, just know you probably have plenty of company: millions of Chinese coffee lovers.

When one customer recently posted an open letter online to the chief executive of Starbucks in China to complain about the way the American coffee chain calls its different size cups, the commiseration started to pour in. The original post was entitled: "When will you stop thinking that your customers who order a medium cup of coffee are ignorant or stupid?" Despite it's extra large title, the letter quickly fired up some like-minded clients of the Seattle-based chain.

Lin Guotong, the online letter writer and a loyal Starbucks customer since 2010, says he's irritated by the barista's same-old questions: "Are you sure the medium cup is what you want? In our store, the medium cup is the smallest cup." Starbucks in China offers the zhong(中-medium), da(大-big), and chao-da (超大,super-big). Lin, proud holder of a Starbucks Gold card, says the staff at the popular coffee chain should know that he's a loyal customer and not ask him about his choice of cup size each time he visits. He says he's used to Starbucks branding its cup sizes with "low-class promotion methods."

Chinese customers have long expressed annoyance with names given to cup sizes at Starbucks. "Why on Earth do you want to call the smallest cup the medium cup if you have only three sizes on offer? This obviously runs against common sense," one customer said.

Luo Yonghao, a Chinese internet celebrity, recently posted a video on his blog criticizing the American giant, which has more than 2,200 stores across China. In the video, Luo is corrected over and over again by a female barista who insists on him calling a medium cup, large. In despair, Luo smacks his own face in frustration.

In the US, Starbucks has four cup sizes, and none are called "small." There's "short," and then medium is a "tall." Any bigger than that, and you are required to speak Italian, which at least is a bit easier than Chinese.

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Society

Debt Trap: Why South Korean Economics Explains Squid Game

Crunching the numbers of South Korea's personal and household debt offers a glimpse into what drives the win-or-die plot of the Netflix hit produced in the Asian country.

In the Netflix series, losers of the game face death

Yip Wing Sum

-Analysis-

SEOUL — The South Korean series Squid Game has become the most viewed series on Netflix, watched by over 111 million viewers and counting. It has also generated a wave of debate online and off about its provocative message about contemporary life.

The plot follows the story of a desperate man in debt, who receives a mysterious invitation to play a game in which the contestants gamble their lives on six childhood games, with the winner awarded a prize of 45.6 billion won ($38 million)... while the losers face death.


It's a plot that many have noted is not quite as surreal as it sounds, a reflection of the reality of Korean society today mired in personal debt.

Seoul housing prices top London and New York

In the polished streets of downtown Seoul, one sees endless cards and coupons advertising loans scattered on the ground. Since the outbreak of the pandemic, as the demand for loans in South Korea has exploded, lax lending policies have led to a rapid increase in personal debt.

According to the South Korean Central Bank's "Monetary Credit Policy Report," household debt reached 105% of GDP in the first quarter of this year, equivalent to approximately $1.5 trillion at the end of March, with a major share tied up in home mortgages.

Average home loans are equivalent to 270% of annual income.

One reason behind the debts is the soaring housing prices. In Seoul, home to nearly half of the country's population, housing prices are now among the highest in the world. The price to income ratio (PIR), which weighs the average price of a home to the average annual household income, is 12.04 in Seoul, compared to 8.4 in San Francisco, 8.2 in London and 5.4 in New York.

According to the Korea Real Estate Commission, 42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s. For those in their 30s, the average amount borrowed is equivalent to 270% of their annual income.

Playing the stock market

At the same time, the South Korean stock market is booming. The increased demand to buy stocks has led to an increase in other loans such as credit. The ratio for Korean shareholders conducting credit financing, i.e. borrowing from securities companies to secure stock holdings, had reached 21.4 trillion won ($17.7 billion), further increasing the indebtedness of households.

A 30-year-old Seoul office worker who bought stocks through various forms of borrowing was interviewed by Reuters this year, and said he was "very foolish not to take advantage of the rebound."

In addition to his 100 million won ($84,000) overdraft account, he also took out a 100 million won loan against his house in Seoul, and a 50 million won stock pledge. All of these demands on the stock market have further exacerbated the problem of household debt.

42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s

Simon Shin/SOPA Images/ZUMA

Game of survival

In response to the accumulating financial risks, the Bank of Korea has restricted the release of loans and has announced its first interest rate hike in three years at the end of August.

But experts believe that even if banks cut loans or raise interest rates, those who need money will look for other ways to borrow, often turning to more costly institutions and mechanisms.

This all risks leading to what one can call a "debt trap," one loan piling on top of another. That brings us back to the plot of Squid Game, "Either you live or I do." South Korean society has turned into a game of survival.

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