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Coffee majors rewriting playbook in China

2026-10-06 14:09   China Daily

Visitors enjoy coffee at Shanghai Starbucks Reserve Roastery in Shanghai's Jing'an district on May 14. Companies from Starbucks China to Luckin Coffee are increasingly emphasizing premium experiences and sustainable returns. WANG GANG/FOR CHINA DAILY

  For much of the past decade, success in China's coffee market was measured by two numbers: how many stores a company could open and how cheaply it could sell a cup of joe.

  That formula helped transform China into one of the world's fastest-growing coffee markets. Chains rushed to blanket cities with outlets, expanded into counties and townships and conditioned consumers to expect coffee for as little as 9.9 yuan ($1.47) a cup.

  Now, the industry's biggest players are rewriting the playbook.

  Rather than chasing store counts at all costs, companies from Starbucks China to Luckin Coffee are increasingly emphasizing store productivity, premium experiences and sustainable returns, reflecting a broader shift as China's coffee market enters a more mature stage of development.

  The transition marks an important inflection point for an industry that has spent years prioritizing scale over efficiency. As store networks become denser and competition intensifies, investors are paying less attention to how many outlets companies open and more attention to whether those stores generate healthy profits.

  No company better illustrates the shift than Starbucks China. In September, Starbucks opened its new-generation flagship Starbucks Reserve inside Beijing SKP, one of China's most prestigious luxury shopping malls.

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