What Does the China Coffee Industry Gain From Tea Cat?

Cotti Coffee has launched Tea Cat, a tea beverage brand focused on healthy milk tea, 397 days after opening its first store. The first Tea Cat outlet opened in Pingnan County, Ningde, Fujian, and is in internal testing. Chief Strategy Officer Li Yingbo says Tea Cat centers on original-leaf milk tea, covering pure tea and fresh fruit tea, with a 6.9 yuan per cup promotion.

The move reflects pressure inside the China coffee industry, where Cotti already runs a joint-operation, low-price model. Tea Cat benchmarks mid-to-high-end tea brands on product while matching lower-priced rivals on price, and its drinks list includes rice milk tea, coconut series, milk tea, fruit tea, and pure tea, mostly at 16 yuan. Insiders see the brand easing coffee-track competition by using existing franchisee and supply chain resources.

After 397 days since the opening of its first store, Cotti Coffee officially announced the launch of its second brand—Tea Cat, a brand-new tea beverage brand focused on healthy milk tea. The first store has landed in Pingnan County, Ningde, Fujian, and is currently in the internal testing phase. According to Li Yingbo, Chief Strategy Officer of Cotti, Tea Cat focuses on the original-leaf milk tea track, with products covering pure tea, fresh fruit tea, and more. At the same time, Tea Cat continues Cotti's low-price approach, launching a promotional campaign of 6.9 yuan per cup, sparking heated discussion among netizens. Some industry insiders believe that Cotti's move may be aimed at easing the competitive pressure in the coffee track and leveraging its existing franchisee resources and supply chain advantages to develop new business. Whether Tea Cat can trigger a new price war in the tea beverage circle is worth watching.

▲

Click to follow | Daily specialty coffee culture magazine Coffee Workshop

On the 397th day after the opening of Cotti Coffee's first store, Cotti announced the launch of its second brand—Tea Cat, a brand-new tea beverage brand. The first store officially launched today, located in Pingnan County, Ningde City, Fujian Province, and is currently in the internal testing phase.

According to Li Yingbo, Chief Strategy Officer of Cotti Coffee, Tea Cat focuses on the healthy milk tea track, mainly featuring original-leaf milk tea and covering products such as pure tea and fresh fruit tea.

Some netizens have revealed that Tea Cat will still adopt a risk-sharing joint operation model, with a low-price subsidy strategy, focusing on the low-price tea beverage market. Its products benchmark mid-to-high-end tea beverage brands such as Chagee and Goodme, while its prices benchmark Mixue Bingcheng. Drinks mainly include 0 non-dairy creamer real tea, Wuchang rice milk tea, pure coconut series, milk tea, fruit tea, and pure tea, all priced at 16 yuan.

Just as Cotti lowered the price of a single cup of coffee to 8.8 yuan, Tea Cat seems set to continue this low-price promotional strategy, launching a promotion of 6.9 yuan per cup.

Some industry insiders analyze that Cotti's launch of the "Tea Cat" brand is very likely because it has encountered enormous pressure in the coffee track, so it needs some new "stories" to meet certain needs, including those of franchisees. After more than a year since its founding, Cotti has already held a large amount of franchisee resources, which can also be considered an advantage.

According to Cotti's investment promotion staff, the franchise fee for a Tea Cat standard store (including decoration and equipment) is 350,000 yuan, while the cost for a pickup store is 200,000 yuan, including a 50,000 yuan stocking deposit, 100,000 yuan equipment cost, and 50,000 yuan decoration fee.

At the same time, the supply chain resources Cotti has accumulated in the coffee track may be able to feed back into the tea beverage business. Li Yingbo stated that the launch of Tea Cat will fully leverage the company's synergies in supply chain, intelligence, operating system, and customer base. At present, Cotti Coffee's global store count has approached 6,500, and its international layout has basically been completed. On this basis, Cotti has established the Dangtu East China Supply Chain Base and the Wuhu International Supply Chain Base. The two bases have a planned total area of 360,000 square meters and will be put into operation successively in early 2024.

And netizens have also been discussing "Cotti entering the tea beverage circle" heatedly:

"The price is 6.9, cheap, tasty, and healthy? I am skeptical "

"Is it going to open next to Mixue Bingcheng? Can it bring down the price of Snow King? If it can, I'll support it."

Some netizens also believe that Cotti is the "involution king" of the coffee world and a true industry disruptor, punching Luckin on one side and kicking Chagee on the other. This kind of move may trigger a new price war in the "tea beverage circle." What do you think?

Disclaimer: Some images in this article are from the internet. For some content on the website, such as images, we will respect the original author's copyright and indicate the source. However, due to the large quantity, there may be individual images or texts that have not yet been credited. Please forgive us. If the original author has any dispute, they may contact the website for handling. Once verified, we will correct it immediately. Compiled and edited by "Coffee Workshop." Please indicate the source when reprinting. If there is any infringement, please inform us for deletion. Thank you~!

The above content is compiled by CoffeeHunters, a coffee news website.