Unprecedented Boom in Chinese Coffee Market Enticing International Giants’ Substantial Investment
BY Shine HuDec 23, 2020
Starbucks expects to open 600 new stores in China in the fiscal year 2021. It aims to make a presence in 230 cities and own 6,000 stores nationwide by the end of the fiscal year 2022. McDonald's plans to enlarge the McCafé outlet number to more than 4,000 by 2023. Tim Hortons aims to open more than 1,500 stores nationwide within ten years.

The growth rate of the Chinese coffee market is terrific. According to the "Analysis Report on China's Coffee Industry Market Demand and Investment Planning for 2020-2025" [1], the average annual growth rate of coffee consumption in China is 15%, while the world average growth rate is only 2%.

In recent years, Chinese emerging coffee brands represented by Saturnbird, Yongpu, and Secre have delivered excellent performances. Saturnbird has defeated Nestlé for two consecutive years (2019 and 2020) to be the TOP1 selling brand in the coffee category on Tmall's Double Eleven. It also completed five rounds of financing in less than two years [2].

ChemLinked has written an article earlier this year to introduce the Chinese coffee market competition landscape -- See here: China's Booming Coffee Market.

Interestingly, the rise of Chinese-grown brands and the global epidemic challenge have not slowed down international giants' expansion in the Chinese market and on the contrary, many brands have expedited opening new stores and releasing new products/brands in China.

ChemLinked suggests that this momentum will become even stronger in the next few years. This is greatly due to China's effective control of the epidemic, which has strengthened the Chinese market's strategic importance in the expansion of international coffee brands.

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Shine Hu
ChemLinked Research Analyst
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