The coffee industry reshuffle is just around the corner! Even coffee was exposed that a large number of shop closures may be related to the lack of financing.

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The just past 2018, known as the "first year of coffee" in China's coffee market, not only led to the rise of "new retail coffee" such as Luckin Coffee and Lian Coffee, which stirred up the old market order like "catfish". What's more, convenience store coffee, which has the strength to develop and vigorously seize the market share of Chinese coffee, the self-service coffee machine industry has also boomed because of the injection of capital. With the rapid development of local coffee brands, foreign brands such as Japanese "National Coffee" and Canadian "National Coffee" are also landing. Starbucks, Costa and Pacific Coffee, as representatives of the traditional coffee industry, have also changed one after another after the impact, and strive not to be eliminated by the market. However, in the fierce competition, the original coffee market pattern has been broken, a new round of elimination and rise is inevitable, the reshuffle of the domestic coffee industry is now.

The dispute between Starbucks and Luckin Coffee is still going on fiercely and has even attracted the attention of foreign media recently. The global coffee chain Starbucks is in big trouble in China and needs to face the fierce impact of new and old competitors, even if it opens a new store, it is difficult to solve Starbucks' difficulties in China, according to an article published by Forbes, a US business magazine. The competitors Starbucks has to deal with include British coffee brand COSTA, local trendy cafes and Luckin Coffee, the most challenging competitor it has ever encountered in the Chinese market, according to the article.

According to related reports, Coca-Cola plans to open another 800 stores by 2022 after its acquisition of COSTA, while local company Luckin Coffee plans to complete another 2500 stores in 2019, bringing the total to 4500, directly surpassing the 4121 store layout that Starbucks will reach by the end of 2019. Starbucks, a dominant company in China, has been under attack from both sides for many years.

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. Guoxin Securities research data show that China's coffee consumption is growing at an annual rate of about 15%, and the sales volume of China's coffee market is expected to reach 300 billion yuan in 2020. From the international point of view, the per capita coffee consumption in China is only 0.003 cups / person / day, which is far behind that of the United States (0.931 cups / person / day), but South Korea and Japan, which are also in Asia, have reached 0.329 and 0.245 cups / person / day respectively. There is still a lot of room for improvement in coffee consumption in China.

The huge potential and rapid development trend of China's coffee market has naturally attracted a lot of capital. Lian Coffee, one of the "Big three" of takeout coffee, was founded in 2014 and has experienced three rounds of financing so far. Luckin Coffee, another giant, completed two rounds of financing within a year, with a final valuation of $2.2 billion! At the beginning of 2019 alone, two coffee brands, FISHEYE fisheye Coffee and three and a half Dinner, have announced the completion of round A financing of tens of millions of RMB. The intensity of the market scuffle is evident.

As one of the representatives of Internet coffee, Lian Coffee was exposed at the beginning of the year that the quality of the capital chain had shrunk. According to a previous Chinanews.com financial report, the source came from an industry insider who had worked in Lian Coffee, who revealed that the news mainly focused on three areas: a sharp decline in the number of orders in its stores; arrears of payments to suppliers; and coffee beans that did not match the publicity. Even Coffee later replied that this was unfounded and false news, and even Coffee CMO Zhang Hongji responded to the matter on moments, saying bluntly that the revelation was not true.

However, according to the Economic Information Daily recently, Lian Coffee has begun to close a large number of shops in several major cities across the country. Take Beijing as an example, it turns out that there are only more than 60 stores, but more than 20 stores have been closed after the Spring Festival. The pomegranate Zhuang shop on Dahongmen Street in Fengtai District and the Changying shop at No. 20 Chaoyang North Road are no longer open. These stores may be closed.

Not only in Beijing, but also in Shanghai, Guangzhou, Shenzhen, Hangzhou and other places, many stores are no longer open. At most, there were more than 120 stores in Shanghai, but at present there are only more than 70 normal stores, while Hangzhou has at most a dozen stores. The latest situation is that only one is open. It is understood that the proportion of Lian Coffee in the national shop closure has reached 30%, 40%.

As for the reasons for closing stores, insiders say that first, the cup volume has declined. Take Shenzhen as an example, the average daily cup volume of the original 30 or so stores reached 220 cups per day, while at present, less than 10 stores averaged 150 cups a day, while most of the stores closed in Shanghai had an average daily cup volume of less than 100 cups, many or even 50 cups; second, there was no new financing in place for a long time, and subsidies absorbed a lot of traffic in the coffee war.

In response, Lian Coffee responded that a round of store adjustment was completed around the Spring Festival, aiming at unprofitable and early stores that did not meet the brand requirements; the purpose of the optimization was simply to ensure that the company returned to profitability and prepare for the winter; as far as the current situation is concerned, Lian Coffee will return to profitability in the second quarter; a new round of financing will be announced before April.

Coffee industry reshuffle is imminent, once the industry boss Starbucks, Costa after selling Coca-Cola, the new local coffee force Luckin Coffee. What market strategies will coffee brands with different cultures nourish and different origins lay out in 2019, and who will be the first to be eliminated by the market? The coffee workshop will continue to attract everyone's attention.

The picture comes from: the Internet

Source: economic reference Network

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