There is a scuffle in the trillion coffee market, and the investment and financing community is optimistic about the "county youth".

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"burned more than a billion yuan", Luckin Coffee opened 2400 stores in just 14 months.

On April 18, Luckin Coffee completed round B financing of 150 million yuan, with a valuation as high as 2.9 billion US dollars. Another 2500 new stores will be opened this year. In the first quarter, they have settled in seven cities in the country, and plan to settle in another 11 cities by the end of April.

Not only lucky, coffee "crazy" can be found everywhere. On April 15, Lipworld Coffee announced the completion of 10 million yuan pre-A round financing.

On April 17, Lian Coffee launched a new brand, Pocket Coffee, and will announce a new round of financing soon.

Chen Yufei, partner of the China Investment Center, said that China is the largest emerging coffee consumer, accounting for only 40% of coffee consumers in first-and second-tier cities, while the rest are in third-and fourth-tier cities. As a result, capital and giants not only compete for the core areas of urban consumption, but also spread the war to more than 2000 county-level markets.

Coffee goes to the countryside, the growth rate is 7 times.

Coffee is being integrated into the local way of life in a county on the outskirts of Xuzhou, Jiangsu Province.

Liang Jing returned to her hometown to open a cafe after graduating from university. Liang Jing, who majored in industrial design, added a lot of warm and leisure atmosphere to the cafe. "most of the people who come here to spend money are young people such as couples, classmates and friends. The design space is big and comfortable enough that they can stay for a long time. Due to the low rent and labor costs, the daily revenue is also OK, and it is necessary to make an appointment in advance during the peak winter and summer seasons.

Liang Jing has witnessed the changes of this county in the past two decades. There are no well-known enterprises in this fourth-tier town, and people most want to work as civil servants. When Liang Jing entered the experimental middle school, KFC had just opened here. Office workers like to come here to eat hamburgers and chat with colleagues, while student parties like to come here to order a coke to study or play poker.

Three years later, a commercial complex opened, along with Starbucks, which began to lay out third-and fourth-tier cities. There are a lot of people coming here to buy coffee, chat, study and rest. Consumers in KFC and McDonald's are moving here.

"when I walked into Starbucks, almost everyone was holding a drink in his hand." Liang Jing said that what people are flocking to is not necessarily the quality of coffee, but more the mood of holding a cup.

The investment and financing community is concerned about business value. Coffee market is a far from breaking out industry in our country. According to the statistics of the Investment and financing Industry Research Institute, the annual per capita coffee consumption is about 240 cups in the world, 360 cups in Japan, and about 400 cups in North America and Europe. The annual per capita consumption of coffee in China is only 5 cups.

Experts in the investment and financing industry predict that the size of China's coffee market will reach 300 billion yuan next year, and it is expected that China's coffee market may exceed 1 trillion yuan in 2025. From the outside, there is still a lot of room for growth in China's coffee consumption market, with coffee consumption growing at an annual rate of more than 20 per cent, much higher than the global annual growth rate of 2 per cent, while coffee shop chains are growing at 25 per cent a year.

Chen Yufei, partner of the China Investment Center, pointed out that with the salary level of residents in third-and fourth-tier cities rising year by year, the obvious increase in the disposable income of "county youth" will give rise to new consumer demand when the cost of living and prices are lower than those in big cities.

Consumption in third-and fourth-tier cities will quadruple from 15 trillion yuan in 2017 to 45 trillion yuan in 2030, said Xing Ziqiang, chief China economist at Morgan Stanley.

According to the survey of the investment and financing industry, the overall consumption growth rate of third-and fourth-tier cities is 2-7 times that of first-and second-tier cities, and there is huge room for growth in the consumer market of third-and fourth-tier cities.

According to the 2018 Insight of China's Coffee Industry released by CBNDATA, only more than 40 percent of online coffee consumers in first-and second-tier cities accounted for more than 40 percent in 2017, with the rest in third-and fourth-tier cities.

Integrate the high-quality resources of the investment and financing industry and seize the trillion "big cake"

The coffee industry has ushered in an investment window. Fu Yousheng is convinced of this.

Fu Yousheng, founder of Zhejiang World High quality Coffee Management platform Project, has been engaged in import and export trade for many years and has traveled all over the world. Coffee is a necessity of his life. He keenly observed that with the spread of coffee culture in China, especially the accelerated pace of work and life of the new generation of young people, white-collar workers and other people, coffee drinks are generally accepted. However, the coffee market is mixed with the good and the bad, and there is a chaotic situation such as high price, poor quality, market chaos and so on.

Fu Yousheng is committed to creating a comprehensive service platform for integrating the world's high-quality coffee resources, that is, realizing new retail through the integration of online and offline channels, and adopting excellent industrial chain management capabilities to improve the performance-to-price ratio of high-quality coffee. Create a new retail platform that integrates B2B, B2C and O2O, and occupy the highland of China's coffee market.

In order to control the quality from the source, Fu Yousheng decided to cooperate with INCOFOOD Group, which has nearly 50 years of coffee production history in Indonesia. As for offline channels, cooperation agreements have been signed with SUNING, SUNING, Didi Hitchhiking, China Resources Shangchao system, Shanghai Airport Group, Hangzhou full Group, Guangzhou Tianfu Group and so on.

Recently, Fu Yousheng found the most authoritative third-party enterprise financing service organization investment and financing platform in China, seeking financing of tens of millions of yuan. it is used to improve the integrated construction and operation and maintenance of the online platform, the research and development of the Internet of things automatic unmanned coffee machine project, and so on. As soon as the project was launched, it was warmly welcomed by Oriental Fuhai, Jiuren Capital, IDG and other institutions.

It is not a unique instance, but has its counterpart. The "Sichuan Coffee Trading Center" project of returned overseas Chinese Zhu Benli plans to raise 200 million yuan and sell 20% of its shares. Since the project was released by the investment and financing platform, a total of nearly 2000 domestic and foreign customers have reached a cooperation intention with Mr. Zhu. Its headquarters base, logistics base and sub-packing base in Chengdu have been highly valued by the local government and given key support in accordance with the "one-case-discussion" approach.

Zhang Mu (a pseudonym), the owner of a well-known coffee brand in Beijing who has just raised funds from the investment and financing industry this month, praises the concept of unlimited scenes advocated by Luckin Coffee, creating a small and sophisticated storefront, using capital power and Internet technology, with the help of the new retail concept of the combination of online and offline, transform and innovate the existing coffee industry, and create their own Internet coffee brand.

Chen Yufei suggested that coffee makers should strengthen their efforts to tap the deep-seated needs of users and enhance the experience of value-added services. For example, in terms of product innovation, the mainstream products in the coffee market are divided into three categories: raw coffee, instant coffee and roasted coffee. From the perspective of coffee drinking structure, the market share of roasted coffee has exceeded 10%.

In the next 10 years, the consumption structure of coffee will change greatly, consumers will prefer roasted coffee, and coffee entrepreneurship is still a potential project.

The article is from the Shanghai Hotline.