Annual data Analysis and Forecast of China's Coffee Market: instant Coffee Market share exceeds 70% (figure)

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China Business Intelligence Network News: with the improvement of our people's living standards and the continuous growth of awareness of coffee culture, coupled with the huge demographic dividend, stimulate domestic coffee consumption. At present, the Chinese coffee market is entering a stage of rapid development, so in the past two years, the major coffee brands are constantly consolidating their market position by accelerating the opening of stores, laying out the high-end market, strengthening the coffee supply chain and so on.

The number of coffee shops exceeds 140000, and coffee consumption continues to grow.

The rapid development of China's coffee industry has led to coffee chain industries, such as coffee shops. According to the data of China Business Industry Research Institute, the number of coffee shops in China has increased rapidly in recent years. There are about 15906 coffee shops in China in 2007. By 2012, the number has increased rapidly to 31794. It is expected that the number of coffee shops in China will exceed 140000 in 2018.

Data source: China Business Industrial Research Institute

In terms of coffee consumption in China, the consumption of Chinese coffee market increased steadily from 2014 to 2018. The total coffee consumption in 2014 was 21.81 million tons, an increase of 34 percent over the same period last year; in 2017, the total consumption was 38.25 million tons, an increase of 29 percent over the same period last year. With the gradual maturity of China's coffee market, the market has entered a period of integration, the growth rate will decline.

Data source: USDA, China Business Industrial Research Institute

Market share of coffee industry segment

In the field of coffee chain, the local coffee enterprises represented by the above island coffee occupy a considerable market share by virtue of their first-in advantages and channel advantages. Foreign brands represented by Starbucks, relying on its brand image and differentiated competitive strategy, occupy a leading position in the subdivision of "first-tier cities" and "espresso". In recent years, some emerging coffee chain brands have gradually broken the monopoly position of Starbucks and Shangdao coffee market by virtue of their accurate market positioning and unique business model, driving the chain coffee market to develop in a more diversified direction.

Coffee beans after raw bean treatment, roasting, extraction, cooking and other steps into a cup of drink, according to the different consumption patterns, coffee can be divided into instant coffee, instant coffee, freshly ground coffee. From the current market segment of China's coffee industry, instant coffee dominates the Chinese coffee market. According to the data, the market share of instant coffee is as high as 71.8%, followed by freshly ground coffee with a market share of 18.1%, followed by instant coffee with a market share of 10.1%.

Data source: China Business Industrial Research Institute

The development prospect of Chinese coffee market is promising.

According to the London International Coffee Organization, compared with the global average growth rate of 2%, China's coffee consumption is growing at an astonishing rate of 15% a year. It is expected that by 2025, China will grow into a giant coffee consumption empire of 1 trillion yuan. With the continuous improvement of domestic consumers' preference for coffee, China's coffee market shows great potential and will make great progress in the past decade.

Combined with the above three major factors, it is not difficult to understand that the Coca-Cola acquisition of Kashijia is a win-win situation. On the one hand, the acquisition of hot drinks, but also completed the complete layout of Coca-Cola in the beverage market. Coca-Cola can also further develop the coffee market business and diversify, thus to some extent make up for the decline in the carbonated beverage market. For Ka Shijia, on the other hand, the pound has fallen and labor costs have risen due to the recent rise in coffee bean costs. Coupled with Brexit, the follow-up impact may last for a long time, and the operation of Costa in the UK is very serious. In addition, Costa in the UK home market stores are quite dense, the home market is saturated, store traffic is also losing, resulting in the same store sales growth slowed, profits fell. Same-store sales of Costa coffee rose just 1.2 per cent last year and fell 2 per cent in the first quarter compared with the same period a year earlier, according to the data. By joining Coca-Cola with its strong customer network, Coca-Cola will bring great potential for multi-form business development.

(article Source: China Business Industrial Research Institute)

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