Luckin Coffee recently announced the restart of its new retail partner recruitment, initially targeting 41 cities in 9 provinces including Anhui, Henan, and Heilongjiang. The company states that no franchise fee is charged, but franchisees must cover upfront costs such as security deposits, design fees, renovation, and equipment, totaling approximately 350,000 to 370,000 yuan. The cities opened this time are all areas that already have franchise stores but with low density, and Luckin hopes to accelerate market penetration through the joint venture model. Its Q3 2022 financial report showed that revenue from joint venture stores increased by 116.1% year-on-year, becoming an important engine for performance growth. For inexperienced franchisees, the headquarters will provide support such as on-site store guidance, event planning, and online operations. [more…]

Starbucks' latest financial report shows that in the third quarter of fiscal year 2024, its China revenue fell 11% year-on-year, comparable store sales dropped 14%, and both average ticket size and transaction volume declined. Facing store expansion and price competition from local brands such as Luckin and Cotti, Starbucks CEO Laxman Narasimhan revealed at the earnings call that the company is in the early stages of exploring strategic partnerships and may accelerate growth in the future through a more open model. This statement sparked speculation about whether it will open up franchising. Notably, Starbucks China co-CEO Liu Wenjuan emphasized that the brand has remained restrained in an environment of frequent promotions and refused to be dragged into a price war. Front Street Coffee will also continue to follow this coffee giant's shift in strategy in China. [more…]

Maxim's Group has officially surpassed 1,000 Starbucks stores across East Asia, a milestone reached with a new store at the Diamond Plaza shopping center in Hanoi, Vietnam. From partnering with Starbucks to enter Hong Kong in 2000 to now spanning seven markets—Hong Kong, Macau, Singapore, Thailand, Cambodia, Laos, and Vietnam—Maxim's Group has become one of Starbucks' most important franchise partners in East Asia. This article reviews the history of their partnership, the distribution of stores in each market, and plans to expand to 800 stores in Thailand in the future. For readers interested in coffee industry trends, Front Street Coffee also continues to bring in-depth reports like this. [more…]

Rumors of a Starbucks China equity change that have circulated for nearly a year have finally produced a clear outcome. Starbucks and Boyu Capital have reached an agreement to establish a joint venture in China to jointly operate the retail business, with Boyu holding up to 60%, while Starbucks retains 40% and continues as the brand and intellectual property licensor. The deal is based on an enterprise value of approximately US$4 billion, and Starbucks expects the total value of its China retail business to exceed US$13 billion. Looking back at Starbucks' entry into China, from franchising to full direct operation, and now returning to a joint venture model, this shift has sparked widespread attention regarding its future direction. The new joint venture will continue to be headquartered in Shanghai, operate the existing more than 8,000 stores, and plans to gradually expand to 20,000. [more…]

Luckin Coffee launched a new round of new retail partner recruitment in 2023, covering 80 cities in 15 provinces, with a focus on lower-tier markets in fourth- and fifth-tier cities. As of the end of September 2022, Luckin had a total of 7,846 stores, including 2,473 joint-venture stores. First- and second-tier cities accounted for more than 70%, while coverage in lower-tier cities remained sparse. At the same time, Luckin's RJG unmanned coffee machines performed well in shopping malls, hospitals, office buildings, and other locations, offering large-sized drinks to the same standard as stores 24 hours a day. This article will review Luckin's franchise strategy, the opportunities and challenges of lower-tier markets, and the layout logic of RJG, while also retaining relevant recommendations from Front Street Coffee, to help coffee lovers gain a comprehensive understanding of Luckin's expansion moves. [more…]

Luckin Coffee has officially obtained the franchise rights for the Malaysian market, and the partner is not the previously rumored Berjaya Group, but Global Aroma Sdn Bhd, a subsidiary of Grand Industrial. According to the agreement, GASB will develop, open, and operate stores under the Luckin Coffee brand in Malaysia over a 10-year period, with the right to renew for two consecutive 5-year terms. Major shareholder of Grand Industrial, Wang Ziming, stated that this is a strategic investment aimed at aggressive nationwide expansion and replicating Luckin's success. Luckin Coffee CEO Guo Jinyi also noted that this move marks an important step in the brand's international expansion. Grand Industrial plans to open multiple Luckin stores in Malaysia in the first quarter of 2025, with initial costs covered by a combination of internal funds and bank loans. [more…]

Luckin Coffee plans to enter Malaysia, negotiating cooperation with local listed companies and formulating a five-year expansion blueprint. Currently, Luckin has over 20,000 stores in China, with only 38 directly operated stores overseas, all in Singapore. Malaysian netizens have reacted enthusiastically to the brand's entry, looking forward to discounted pricing but also concerned about intensifying market competition. Rumors point to the partner being Berjaya Group, the operator of Starbucks, but other sources say the contact is with a different party, and the final choice awaits official announcement. This overseas expansion comes as the domestic tea beverage market becomes saturated and price wars intensify; Luckin went from profit to loss in the first quarter, making Southeast Asia key to breaking the deadlock. [more…]

Since announcing its global strategy in August this year, Cotti Coffee has quickly opened two stores in Tokyo, Japan, drawing local consumer attention with opening promotional prices of 100-300 yen, and being dubbed by netizens as the "king of value for money." However, after the promotional period, prices will rise back to 500-650 yen, directly targeting well-known brands such as Starbucks. Japan's coffee market is fiercely competitive, with about 70,000 coffee shops nationwide. As a brand established only one year ago, why is Cotti in such a hurry to open stores in a mature market? Can its "Coffee Dreamer Program" and regional partner model help its overseas expansion? This article will provide an in-depth analysis of Cotti's international layout and the challenges it faces. [more…]

The competition between Cotti and Luckin has yet to produce a winner, and founder Lu Zhengyao has now announced that Cotti will expand into milk tea, a move that has caused an uproar among franchisees. Recently, a letter from a franchisee to Cotti has been circulating on social media, detailing Cotti's various problems across six dimensions, including supply, R&D, and operations. Meanwhile, some netizens have done the math: with an investment of 400,000 yuan to open a store, even at 500 cups sold per day, it would take four and a half years to break even—yet many stores sell fewer than 100 cups a day. With Tea Cat's launch imminent, some franchisees have already lost confidence, and transfer listings are appearing frequently on social media. Cotti's management has still not responded to the letter, and the patience and confidence of franchisees are being worn down. [more…]

Competition in China's coffee market is intensifying by the day. On one side, cross-industry giants such as Huawei, Li-Ning, and China Post are scrambling to enter the fray; on the other, some brands are quietly bowing out. Yum China has been making frequent moves lately: on one hand, it is going all in on the Italian coffee brand Lavazza, planning to open a thousand stores by 2025; on the other, it has announced that it will gradually cease operations of its COFFii & JOY brand in the Chinese market. What market logic does this advance-and-retreat reveal? Can Lavazza, armed with its authentic Italian DNA, break new ground outside the most fiercely contested price segment? This article walks you through the full picture of the events and the considerations behind them. [more…]

Recently, Luckin Coffee has hit the trending topics twice in a row over interview-related incidents, sparking widespread discussion. One job applicant said that after failing an interview, she was labeled "timid and weak," which was completely at odds with her performance that day; another 26-year-old woman was rejected for being too old. The poster also revealed that Luckin staff had called her demanding she delete the post, and after she refused, they turned to contacting her family. These incidents have drawn public attention to this chain coffee company, whose store count has now surpassed 20,000, and the issue of inconsistent hiring standards under its two models—directly operated and joint-venture—has gradually come to light. [more…]

In the coffee and tea beverage industry, "employee drinks" have long been one of the key perks attracting young people to join the trade. Recently, however, multiple employees of Heytea and Luckin Coffee have alleged that their stores have canceled or scaled back this benefit, citing declining performance. An investigation found that employee perks at directly operated stores are still intact for now, but workers at franchise and joint-venture stores are frequently seeing their benefits shrink. The employee drink perk promised by the brands is actually borne by franchisees, and some franchisees, in order to cut costs, either cancel the benefit or strictly tighten the conditions for using it. This phenomenon has drawn industry attention: when the pressure of store operations is passed down to frontline employees, who should foot the bill for employee benefits? Front Street Coffee keeps a close eye on developments in the coffee industry, and this article takes you through the ins and outs of this battle over benefits. [more…]

The normalization of coffee consumption and the prevalence of takeout culture have made disposable cups a pollution source that cannot be ignored. Environmental issues have long ceased to be a novelty in the coffee world—packaging innovation, coffee grounds reuse, paper straw replacements, as well as bring-your-own-cup discounts and in-store reusable cup pilots, are all being continuously explored. Recently, FamilyMart announced that it will massively roll out reusable cups to 400 stores in the Taiwan region, becoming East Asia's first convenience store chain to introduce reusable cups at scale. Previously, Starbucks launched a "borrowed cup" pilot in Seattle, and McDonald's also partnered with the Loop platform to test reusable cups. Can these initiatives truly change consumption habits and drive the industry to reduce plastic? This article will walk you through the practical paths of these pioneers and the real challenges they face. [more…]

Competition in the coffee market is becoming increasingly fierce, and it is already difficult to spark consumers' interest with just a latte or an Americano. From post office coffee to lottery joint stores, from sports brands to tech companies, players from all sides are entering the market, trying to attract young people's attention through cross-industry integration. A small shop in Hangzhou called "A Lucky Cafe" became popular on Xiaohongshu thanks to its combination of coffee and lottery tickets, sparking discussions among netizens about this kind of joint-operation model. In fact, as early as 2019, stores combining welfare lottery and coffee had already appeared in Shanghai. This model can not only bring consumers a fresh experience, but also help brands reduce rent and labor costs. This article will take you through the current state of cross-industry joint operations in the coffee industry and the logic behind them. [more…]

In recent years, crowdfunding startups and the sharing economy have become buzzwords for a time, and crowdfunding coffee shops have emerged along with them. Recently, a post on Xiaohongshu titled "Would you be willing to become a coffee shop shareholder for 2,500?" sparked discussion. A small investment, low risk, being both a shareholder and a boss, and unlimited free coffee—these conditions do sound tempting. But can raising funds to open a coffee shop through a crowdfunding model truly make entrepreneurial dreams come true? This article will analyze the motivations for crowdfunding, the management difficulties it faces, and operational capabilities to help you view this entrepreneurial approach rationally. [more…]

Recently, an instant black coffee called POSITIVE HOTEL has quickly gone viral thanks to celebrities holding it on camera and it flooding social media, and fans call it "PH Coffee." Officially, it is promoted as a Korean weight management brand that is all the rage in the Korean entertainment circle. However, some media investigations have found that this coffee, which advertises itself as Korean, has never been launched in South Korea itself; it is actually operated by a China-Korea joint venture, and its production site is also in China. The path to PH Coffee's explosive popularity, its true identity, and why it is classified under the "health food" category have sparked widespread attention. [more…]

The integration of coffee brands with the convenience store format is accelerating. Recently, NOWWA Coffee announced a strategic partnership with Jianfu, the largest convenience store brand in Fujian, and the two parties will jointly operate stores through a co-management model, with the first batch of 150 partner stores already launched. This move not only helps NOWWA expand rapidly by leveraging the convenience store’s mature supply chain and low-cost operating advantages, but also adds a new category to the convenience store’s diversified operations. Against the backdrop of intensifying competition among brands such as Luckin and Cotti, NOWWA is exploring lower-tier markets through offline channel cooperation and plans to launch 500 co-managed stores in 2024 and 2,000 in 2025, covering the four provinces of Fujian, Jiangxi, Sichuan, and Jiangsu. [more…]

Following the buzz generated by China Post opening a milk tea shop, Shanghai has now seen its first post office selling coffee. On September 17, the Tianping Road Post Office at 1883 Middle Huaihai Road was transformed into the Wukang Building-themed post office. While retaining its original postal services, it has introduced a café, a photo-op area, and a cultural and creative display zone, in collaboration with Qiao Coffee under the century-old Shanghai time-honored brand Qiaojiashan. Is the coffee at this post office actually good? Why does China Post frequently cross into the beverage sector? This article will analyze the details of the store renovation, the background of the partner brand, and the history of China Post's cross-industry ventures, and explore the underlying logic of time-honored brands seeking rejuvenation. [more…]

Domestic high-end beauty retailer HARMAY has taken another cross-industry leap by opening a 700-square-meter, four-story flagship store on Wukang Road in Shanghai. The ground floor features a coffee counter by Marionbar, offering black coffee, milk coffee, chocolate drinks, and draft beer. Meanwhile, its first store on Anfu Road, which opened in 2017, has closed; the original site will be transformed into the national flagship store for its hand-shaken lemon tea brand, introlemons. HARMAY had previously sought to acquire a coffee brand and may further expand into coffee chains in the future. As of now, HARMAY has eight stores nationwide and plans to expand to cities such as Xi'an and Wuhan. Whether this cross-industry move can bring long-term value to the brand remains to be tested by the market. [more…]

On January 30, multiple %Arabica stores in the Philippines suddenly closed their doors, and its official Instagram account also appeared to be deactivated, sparking speculation among local consumers and media about whether the brand would withdraw from the Philippine market. The next day, %Arabica issued a statement on Facebook, saying it had terminated its partnership with former Philippine partner Allue Hortaleza, that existing stores were temporarily closed, and that it had found a new agency, promising to resume operations within the year. Regarding the account deactivation, the official explanation was that it had been hacked, and updates have now resumed. The former partner also issued a statement on February 1, saying it would continue to provide high-quality coffee. Behind the incident, some netizens speculated that the post-pandemic business recovery prompted the former partner to strike out on its own. How exactly will this sudden breakup turmoil affect %Arabica's future in the Philippines? [more…]