Tag: Cotti Coffee

China’s Coffee Boom Opens New Avenues for Thai Fruit Exporters

Posted on by Qahwa World
BANGKOK – Qahwa World
As China’s coffee market undergoes rapid transformation, a new and unexpected opportunity is emerging for Thai fruit exporters. The rise of domestic coffee giants like Luckin Coffee and Cotti Coffee is not only reshaping the country’s beverage landscape but also creating strong demand for tropical fruit ingredients, an area where Thailand holds a competitive edge.

From Traditional Coffee to Lifestyle Drinks

China’s coffee consumption has surged over the past decade. According to the Department of International Trade Promotion (DITP), coffee imports into China rose from 59,100 tonnes in 2015 to 230,700 tonnes in 2025, an increase of over 290 percent. This growth is driven by younger consumers who view coffee as a daily lifestyle choice rather than an occasional luxury.

The market structure has also shifted significantly. Foreign brands like Starbucks once dominated the premium segment, but local players have gained ground by combining speed, competitive pricing, and strong digital integration.

Local Chains Lead the Way

By 2025, Luckin Coffee leads the market with more than 25,000 branches, followed by the fast-growing Cotti Coffee with over 14,000 outlets, despite being founded only in 2022. Starbucks remains the largest foreign brand with around 7,800 branches.

Top 10 Coffee Brands in China by Branch Count (2025)

Rank Brand Branches Founded
1 Luckin Coffee 25,266 2017
2 Cotti Coffee 14,337 2022
3 Starbucks 7,798 1971
4 Lucky Cup 4,793 2017
5 NOWWA 2,407 2019
6 Manner 1,969 2015
7 K Coffee 1,580 2015
8 Tim Hortons 868 1964
9 M Stand 556 2017
10 Pull-Tab 513 2022

Fruit-Blended Coffees: A New Product Category

To attract young and experimental consumers, Chinese coffee brands are continuously innovating with seasonal menus. Fruit-blended coffees, tea-coffee hybrids, and coconut-based beverages have become key trends. These drinks rely heavily on high-quality fruit ingredients such as purees, frozen fruit, and flavor bases.

Coconut milk has gained particular popularity as a dairy alternative, further increasing demand for tropical ingredients.

Opportunity for Thai Exporters

Thailand is well positioned to benefit from this trend. Fruits like durian and coconut already enjoy strong demand among Chinese consumers. Exporters can expand beyond fresh produce into value-added segments such as:

  • Fruit purees for coffee blending
  • Frozen or chilled fruit for beverages
  • Customized ingredients for coffee chains

This approach also helps utilize lower-grade fruit more efficiently, increasing overall export value.

Strategic Recommendations for Thai Businesses

  1. Partner with Chinese coffee chains for direct supply agreements
  2. Develop co-branded products highlighting Thai origin
  3. Align with digital ordering and delivery ecosystems
  4. Invest in processing and packaging that meets Chinese standards

Conclusion

As China’s coffee market continues to grow in both scale and innovation, Thai exporters have a unique opportunity to move up the value chain. Supplying ready-to-use fruit ingredients could position them as key players in one of the world’s most dynamic beverage markets.

East Asia’s Coffee Shop Landscape Surges as China Alone Adds 20,000 Stores in One Year

Posted on by Qahwa World

Dubai – Qahwa World

A new edition of Project Café East Asia 2026 by World Coffee Portal reveals an exceptional year for the branded coffee chain sector across East Asia, with the region’s total number of outlets jumping 18.4% to reach 180,268 stores. The strongest momentum came from China, Thailand, Indonesia, Vietnam, and the Philippines, all of which posted double-digit expansion in store counts.

  • China Leads the Region with Record-Breaking Growth

China registered the fastest acceleration, expanding its branded coffee shop network by 31.5% over the past year to reach 87,505 outlets—nearly half of all branded cafés in East Asia and almost double the size of the U.S. market. It also became the first national market ever to add more than 20,000 net new stores within a single calendar year.

The main force behind this surge came from domestic champions Luckin Coffee and Cotti Coffee, which together contributed over 12,000 new locations, representing half of the country’s entire branded segment.

China’s competitive landscape is being shaped heavily by pricing battles, most notably the RMB 9.9 (US$1.40) rivalry between Luckin and Cotti. This emphasis on affordability has also propelled the rise of budget-forward chains such as Lucky Cup, operated by Mixue, and KCOFFEE under Yum China.

As local operators increasingly dominate, several international brands have been pushed to reconsider their strategies. A striking example is Starbucks’ agreement to sell a majority stake in its 8,000-store Chinese business to Hong Kong–based Boyu Capital in a deal valued at $4 billion.

  • China Emerges as a Global Lab for Beverage Innovation

While 80% of surveyed Chinese consumers drink hot coffee at least once a week and a quarter consume it daily, operators are aggressively expanding their cold, flavored, and fruit-infused offerings—turning China into a leading testing ground for new flavors.

Matcha, palm sugar, and coconut were rated among the most appealing additions by consumers. Luckin Coffee’s Coconut Latte, introduced in 2017, continues to dominate its sales charts. The brand is known for launching experimental drinks weekly, resulting in items like jelly lattes and cheese lattes.

KCOFFEE has taken novelty even further, releasing products such as Egg Tart Dirty Coffee, a fried-chicken-inspired latte, and even a sparkling black vinegar Americano.

  • Homegrown Chains Strengthen Positions Across East Asia

East Asia’s coffee chain ecosystem is increasingly being shaped by domestic players that emphasize local traditions, accessible pricing, and menus tailored to national tastes. According to World Coffee Portal’s consumer survey, 57% of Chinese respondents prefer homegrown chains over international brands—a trend replicated across the region.

Key examples include:

Jinji Jawa in Indonesia,

ZUS Coffee in Malaysia,

Pickup Coffee in the Philippines, and

Milano Coffee in Vietnam—

each of which added hundreds of new stores in the last year. Their rapid expansion outpaced Western competitors like Starbucks, Costa Coffee, and Dunkin’.

Thailand showed similar dynamics: Café Amazon and PunThai Coffee accounted for 80% of all new cafés opened in the country this year, highlighting the region’s increasing focus on localization, digital engagement, and culturally relevant branding.

  • Industry Leaders Expect Continued Growth

The majority of operators surveyed remain optimistic about the sector’s direction:

71% reported higher sales over the past year.

68% expect trading conditions to further improve in the next 12 months.

World Coffee Portal forecasts that East Asia will become the first region to surpass 200,000 branded coffee shops by the end of 2026. By November 2030, the regional market is projected to exceed 263,000 outlets, reflecting a five-year compound annual growth rate of 7.9%.

  • China is expected to maintain strong momentum with:

20% outlet growth in 2026, and

10.3% average annual growth over the following five years,
bringing its store count to over 142,500 outlets by 2030.

Other markets—including Cambodia, Indonesia, Malaysia, the Philippines, and Vietnam—are also predicted to achieve double-digit outlet expansion over the next year.

  • Expert Insight

Commenting on the findings, Jeffrey Young, Founder and CEO of Allegra Group, highlighted East Asia’s rising global influence. He described China’s addition of more than 20,000 stores in a single year as “astonishing” and emphasized that the region is poised to drive the majority of global coffee market growth in the coming decades. Young added that the entry of East Asian chains into Western markets—along with their distinctive approaches to technology and product innovation—could reshape international trends.

Carlyle and Boyu emerge as likely buyers for Starbucks’ China operations, sources say

Posted on by Qahwa World

Dubai – Qahwa World

Private equity firms Carlyle Group and Boyu Capital have reportedly taken the lead in efforts to acquire a controlling stake in Starbucks’ China business.

Seattle-based Starbucks initiated a formal sales process in May 2025, seeking to bring in strategic partners amid slowing growth and stiff competition from local chains such as Luckin Coffee and Cotti Coffee.

According to sources, up to five firms made the final shortlist by September 2025, with Carlyle and Boyu now viewed as frontrunners for the deal. The transaction is expected to value the China operations at around USD 4 billion, and Starbucks may retain up to a 49 percent interest.

Carlyle already has experience in the coffee and restaurant sector: it acquired South Korea’s A Twosome Place chain and previously held a 28 percent stake in McDonald’s China, which it sold in 2023.

Meanwhile, Boyu has backed major food and beverage enterprises, including a role in investing in Mixue Group, and has co-ownership in the Honeymoon Dessert brand in China and Singapore.

Starbucks currently operates roughly 7,800 stores in China, making it its second-largest market by store count—and roughly 20 percent of its global total—though it contributes only about 8 percent of revenue.
MarketScreener

Unlike most markets where Starbucks licenses some stores, its entire China operation is wholly company-run.

While Starbucks endured three straight quarters of revenue decline in China in 2024, more recently the business has rebounded: it posted three consecutive quarters of year-over-year growth in 2025, including its first six-month stretch of positive same-store sales during the second quarter.
Comunicaffe International

Starbucks Loses Coffee Battle in China and Prepares to Sell Its Unit

Posted on by Qahwa World

Beijing – September 11, 2025 – Qahwa World – Reuters has revealed that Starbucks, the world’s largest coffee chain, is preparing to sell a controlling stake in its China operations in a deal valued at around $5 billion. The decision marks one of the most dramatic turns in the company’s history as slowing sales and intensifying competition from local rivals force the Seattle-based giant to rethink its strategy in its second-largest market.

According to sources cited by Reuters, Starbucks has drawn up a shortlist of five investment firms: Carlyle Group, EQT, HongShan Capital Group (HSG), Boyu Capital, and Primavera Capital. These firms are expected to submit binding bids in early October, with a final agreement anticipated by the end of next month. Financial analysts estimate that Starbucks China will generate between $400 million and $500 million in EBITDA this year, which supports a valuation close to $5 billion.

For years, China was considered the crown jewel of Starbucks’ international growth, with the company expanding to nearly 7,800 stores, representing almost 20% of its global footprint and around 8% of group revenues. But the tide has turned. Data from Euromonitor shows the company’s market share plunged from 34% in 2019 to just 14% in 2024, as local players like Luckin Coffee, Cotti Coffee, and Lucky Cup captured millions of consumers with lower prices, digital apps, and aggressive promotions.

Despite this decline, Starbucks has no plans for a full exit. The company intends to retain a minority stake in its Chinese unit while keeping its coffee roasting facility to safeguard quality standards. This strategy will allow Starbucks to share financial and operational risks with local partners while maintaining a foothold in a market with immense long-term potential.

The shortlisted bidders bring strong experience in food and beverage operations. HSG owns a stake in Heytea, China’s 4,300-store tea chain. Carlyle Group operates South Korea’s 1,700-store A Twosome Place and previously held a stake in McDonald’s China. Primavera Capital has invested in Yum China, EQT formerly owned global foodservice operator SSP, and Boyu Capital is a backer of e-commerce giant Alibaba.

The sale of a controlling stake in Starbucks China represents more than just a financial transaction—it is a strategic turning point. Once viewed as a symbol of Western modernity in China, Starbucks now finds itself forced into a restructuring move to secure its survival in a market where domestic brands are growing at breakneck speed. For investors, the deal offers a rare chance to gain access to a multibillion-dollar coffee market that continues to expand, though marked by fierce competition and price-sensitive consumers.

Binding offers are due in early October, with a final decision expected by the end of the month. Whatever the outcome, one fact is clear: Starbucks is losing the coffee battle in China and entering a new phase of forced partnerships and strategic recalibration that could reshape not only its presence in the country but also the global coffee landscape.