Starbucks (NASDAQ:SBUX) went a little too far when it opened a location in Central Hong Kong's Bank of China Tower—about 230 feet too far, to the nearest source of water in a public restroom, Hong Kong newspaper Apple Daily reported this week.
Because the Starbucks store was put in a location with no plumbing, ever since it opened in October 2011, associates have been rolling a wheeled water tank to a men's restroom in a nearby parking garage several times a day, filling it from a pipe labeled "Starbucks only" and rolling it back to the store.
A local Starbucks spokeswoman said the water source wasn't a problem: "Tap water from the restroom is fit for drinking. The tank used to transport the water is disinfected regularly. Moreover, the branch is equipped with a state-of-the-art filtration system which the water passes through before being used to brew our beverages."
Nonetheless, the Hong Kong Food and Environmental Hygiene Department issued a warning to the store for failing to follow regulations. The store reportedly switched to bottled water after the story became public.
That, of course, was the least of the store's worries after the story broke. An expensive cup of coffee made with "toilet water"? That's not the image Starbucks wants to project, especially after another American chain that's big in China, KFC (NYSE:YUM), was hit with questions about whether its food was tainted.
Aside from brand damage, a bigger concern for Starbucks should probably be the fact that someone signed a lease for restaurant space that had no running water. The roll-the-tank-to-the-restroom routine was an understandable workaround (and one that shouldn't have lasted a year and a half), but the problem wouldn't have existed at all if that lease hadn't been signed when one of the two most crucial elements of the store's product wasn't available in that location.
That seems like a serious lapse—or possibly just a large gap—in the chain's global standards for its outlets. If we hear next month about a Starbucks in Shanghai with no electricity, we'll know someone really isn't paying attention.
Starbucks Preparing A Major Shift In How It Sells Food
Is There Evidence Of Fake Mutton At A Yum Chain In China?
KFC Hit By Double-Whammy In China: First Additives, Then Bird Flu