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…]

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…]

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…]

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…]

Luckin Coffee recently announced through its official WeChat account the launch of a "bring-your-own-store franchise" model, opening joint-operation partnerships to investors who are currently operating stores or own commercial properties. The policy has not yet disclosed specific franchise conditions or revenue-sharing plans, but it has clearly defined construction requirements such as store location, area, and storefront signage, and will initially cover 241 cities nationwide, with a focus on avoiding saturated tier-one and tier-two markets. This move is seen as helping Luckin seize more prime locations and attract investors who had originally planned to franchise with other brands such as Cotti to "switch banners" and join. Against the backdrop of ongoing cutthroat competition in the coffee market, Luckin has officially entered the era of 10,000 stores, accelerating expansion through a combined strategy of self-operation, joint operation, and bring-your-own-store franchising. [more…]

As the Mid-Autumn Festival approaches, the mooncake market is about to enter its peak sales season. However, in recent years, the phenomenon of some boxed mooncakes being overpriced and luxuriously packaged has drawn widespread attention. The National Development and Reform Commission and three other departments recently jointly issued a notice, explicitly imposing key oversight on boxed mooncakes priced above 500 yuan per box, requiring operators to properly retain transaction information for two years, and strictly prohibiting the use of precious packaging materials such as precious metals and rosewood. For e-commerce platforms, the notice also stipulates that they must not indirectly drive up prices by splitting orders or inflating quantities. Consumers should stay rational when purchasing mooncakes and presale vouchers. This article summarizes the key points of the notice and includes a professional coffee knowledge exchange channel. Welcome to follow Coffee Workshop and Front Street Coffee. [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…]

After leaving Luckin, Lu Zhengyao and his original core team have officially unveiled their new brand Cotti Coffee in Shanghai, with the first store located at Tianhui HQ (formerly Lingkong SOHO), competing alongside brands such as Starbucks, Luckin, and Manner. Cotti Coffee is expanding rapidly through a fully directly managed joint-operation model, and has already entered more than 40 cities. It has set a goal of 10,000 stores in three years, or even completing 10,000 stores as early as June 2023. On the product side, in addition to regular coffee, it has also launched limited-edition drinks such as the mate tea series, priced between 9.9 and 18.9 yuan, directly targeting Luckin’s hit products. Specialty coffee brands such as Front Street Coffee are also paying attention to changes in this track. Competition in the coffee industry is accelerating as pandemic controls fade, and what kind of pressure Lu Zhengyao’s bold layout will bring to Starbucks and Luckin is worth continued attention. [more…]

The war in Ethiopia's Amhara region has lasted for nearly a year and continues to escalate. Firefights between Fano forces and the government's joint forces have advanced to only about 55 kilometers from the capital, Addis Ababa. Fighting is intense around cities such as Gondar, and government troops have failed to achieve expected results on multiple fronts, with increasing defections among riot police and militia. At the same time, millions of students have been out of school, medical facilities have been damaged, and the region's economy has suffered severe losses. As a pillar industry accounting for as much as 30 to 40 percent of export earnings, the coffee sector is facing multiple shocks, including instability in producing areas, traders withdrawing, the Red Sea crisis, and the suspension of operations at Djibouti's ports, making the supply outlook far from optimistic. [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…]

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…]

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…]

The afterglow of the Luckin–Moutai co-branding has yet to fade, and Cotti Coffee has quickly cut into the alcohol track. In December 2023, the Moutai Public Welfare Foundation and Cotti jointly established two funds at the Moutai Hotel in Guizhou, and authorized Cotti to exclusively sell Moutai Bu Lao Jiu and Maotan Jiu, donating 10 yuan for every bottle sold. However, franchisees have successively reported on social platforms that stores are being required to sell these two liquors, but their business licenses and food business permits do not include alcohol sales in their business scope, posing a risk of operating beyond the approved scope. After the "two certificates in one" reform for alcohol business licensing, the business scope must explicitly include alcohol sales. Whether Cotti stores can legally sell alcohol has become a hot topic of industry attention. [more…]

Italian century-old coffee brand Lavazza recently made a wholly-owned acquisition offer to French online coffee retailer MaxiCoffee, aiming to strengthen its market position in France and in the e-commerce sector. As France's number one online sales platform for coffee beans and equipment, MaxiCoffee carries more than 350 brands, over 8,000 products and 60 offline sales points. This acquisition is a continuation of Lavazza's international expansion strategy, after the group had previously brought brands such as Carte Noire and Kicking Horse Coffee into its fold. After the acquisition is completed, MaxiCoffee will remain independently operated, with its capital jointly held by the founder, private equity groups and others. This article will sort out the details of the transaction, the backgrounds of both parties and Lavazza's global acquisition map, and also look at its development goals in the Chinese market. [more…]

Recently, Coffee Post issued a stern statement regarding fraudulent franchise recruitment activities in the market that falsely use its brand name, explicitly stating that it has never authorized any third party to engage in franchise cooperation and has initiated legal proceedings to pursue accountability. This incident has once again thrust this coffee brand—jointly created by China Post and Zhongyu Kaye—into the spotlight, and also reflects the market chaos behind the continuously heating coffee track. This article will sort out the sequence of events, the brand's operational structure, and future layout challenges, helping readers clarify the facts and avoid falling into the trap of "fake" operators. [more…]

Nayuki, a leading new-style tea beverage brand founded in 2015, submitted a listing application to the Hong Kong Stock Exchange on February 11 after withdrawing its prospectus for a US offering, officially sprinting toward an IPO. The joint sponsors are JPMorgan, CMBI, and Huatai International. As of September 30, 2020, Nayuki had established 420 stores across 61 cities nationwide and expanded to Hong Kong and Japan. However, while the number of stores has grown nearly tenfold in the past three years, the company remains in a loss-making state, with a loss of 27.51 million yuan in the first three quarters of 2020. The funds raised this time will be used for store expansion, digital operations, and supply chain development. If the listing succeeds, Nayuki will become the first new-style tea beverage stock in China. [more…]

Starbucks has announced it will not renew its contract with Fairtrade, meaning coffee sold in its global stores will no longer carry the Fairtrade certification label. This decision has raised questions about its commitment to ethical sourcing. Starbucks says it will instead rely on the C.A.F.E. Practices standard, developed jointly with Conservation International and independently audited by the third-party organization SCS Global Services. However, many groups worry that without Fairtrade's independent oversight, the C.A.F.E. standard may not truly safeguard coffee farmers' rights on core issues such as minimum purchase prices and sourcing from smallholder cooperatives. This article reviews the history of Starbucks' partnership with Fairtrade, the origins and controversies of C.A.F.E. Practices, and Starbucks' past reversals on its ethical sourcing stance, offering coffee lovers a full picture of this event. [more…]

The parent company of the C'estbon brand, China Resources Beverage (Holdings) Company Limited, has successfully passed the listing hearing of the Hong Kong Stock Exchange, with BofA Securities, BOC International, CITIC Securities and UBS Group acting as joint sponsors. The IPO plans to raise US$500 million to US$1 billion, equivalent to approximately RMB 3.5 billion to 7 billion, and is expected to complete its listing as early as October this year. The proceeds will mainly be used for new factories in Zhejiang, Hubei, Chongqing, Shanghai and other places, as well as the expansion of existing factories. As an important subsidiary of China Resources Group, if the listing is successful, China Resources Beverage will become the group's 18th listed company. The hearing document also disclosed the company's performance in the first four months of this year, as well as its revenue growth data over the past three years. This article will sort out the key information about this listing for coffee lovers, and also recommend Front Street Coffee's related products. [more…]

Danch Meng is an Ethiopian green bean jointly launched by Levelup, a sub-brand of the 90+ company, and Bodhi Leaf, released in 2013, and its name means "good journey" in the local language. This bean comes from smallholder farms in the Gelena Abaya Dumeso area of Yirgacheffe, and thanks to the 90+ natural processing technique, it presents rich flavors of cocoa, black raspberry, plum, floral notes, blueberry, and dark chocolate. Front Street Coffee has also launched a 90+ Danch Meng product, and this article will provide a comprehensive interpretation of this distinctive Yirgacheffe coffee from aspects including the origin of its name, producing area information, processing method, flavor description, and brand background. [more…]

Danch Meng is an Ethiopian green bean jointly launched by Ninety Plus' Levelup sub-brand and Bodhi Leaf. In the local language, it means "good path" or "Perfect approach." This bean comes from smallholder farms in Yirgacheffe, Kelinga Abaya Dumerso, and thanks to the signature 90+ natural processing technique, it presents a rich flavor profile weaving together cocoa, black raspberry, plum, blueberry, and dark chocolate. This article will outline the 90+ brand's grading system, the origin information and naming logic of Danch Meng, and include the pour-over extraction parameters for Front Street Coffee's Sidamo and Danch Meng for coffee lovers' reference. [more…]