Sinopec gas stations sell coffee, even coffee transfer to turn around, selling coffee is more profitable than selling oil?

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China's coffee market is making waves again. On Sept. 3, there were more than 27000 stores across the country. As the Sinopec easy Jet convenience store with the largest number of chain stores in China, it launched a new brand "easy Jet Coffee", with the first store in Suzhou. With Sinopec easyJet's strong entry into the coffee market, it has successfully launched a new retail model of "delivery + store consumption". The supply chain behind it has also been bottomed out-the supply chain partner behind Sinopec easy Jet Coffee is actually the Internet coffee brand Lian Coffee.

EasyJet Coffee launched the mode of "delivery + in-store consumption", 92 #, 95 #, 98 #, which one do you drink?

Why coffee business? Sinopec said that the fast-growing fresh-ground coffee market in China has enabled Yijie to see new business growth points. As a new entry point for Sinopec Yijie's new retail non-oil business, Yijie Coffee conforms to Sinopec Yijie's vision of building a new retail ecosystem of "people, vehicles and life", so that gas stations are not just gas stations.

"EasyJet Coffee" is a self-owned coffee brand launched by Sinopec EasyJet Group based on the new retail concept. There are three different positioning products, namely 92#(black and white coffee), 95#(fashionable special drink) and 98#(boutique series). Among them, the lowest price of hand-brewed black coffee is 12 yuan/cup, the highest price is 28 yuan/cup, and the price of classic coffee is 15 yuan-25 yuan/cup. This and Sinopec gas station all kinds of oil complement each other.

In addition to classic coffee categories, EasyJet Coffee also integrates specialties from all over the world into creative drinks. When coffee meets "Xizang Zhuoma Spring Natural Glacier Drinking Water" and "Gansu Tianshui Flower Cattle Apple", it becomes Yijie "Apple Ice Coffee". At present, orders are ordered through Weixin Mini Programs (Mini). Consumers can choose to pick up, deliver or take out services in the process of ordering.

Sinopec is not selling coffee for the first time. Is selling coffee really more profitable than selling oil?

In fact, this is not Sinopec's first coffee business. As early as last year, when the second generation upgrade was carried out in Yijie Convenience Store, the retail business segment of Sinopec, Ruixing Coffee was introduced into its stores, so that Ruixing Coffee opened a "store-in-store" of about 10 square meters in Yijie Hangzhou's first new image store, and the store adopted the dual-brand store move of "Yijie Convenience Store + Ruixing Coffee".

This time, Sinopec Yijie chose another Internet coffee brand "Lian Coffee" as its partner.

In fact, it has long been proven that selling coffee at gas stations can make money. According to the interface news report, the international oil giant Royal Dutch Shell Group's preferred convenience store can sell 250 million cups of coffee every year. Ke Yifan, executive vice president and president of retail business of Shell Group, said,"Coffee has a much higher profit margin than oil." PetroChina Kunlun Hospitality has developed its own coffee chain brand, Hospitality Coffee; multinational oil company BP has also launched its own coffee brand "Wild Bean" in China.

Oil companies with annual profits of tens of billions compete to lock in coffee business, which is not unrelated to China's expanding coffee market space in recent years and its rapid growth rate. The biggest advantage of "petroleum" coffee is that the oil company has a large convenience store network and good location advantages, which greatly reduces the pressure brought by rent costs, so it can further optimize the raw materials of the products and lower the price of the products.

For example, in the 2018 China Convenience Store TOP 100 List released by China Chain Store Association in May 2019, EasyJet Convenience Store ranked first with 27259 stores. For EasyJet, which has a large number of stores and a large number of middle-and high-income groups, this consumption scenario is very consistent with the demand of coffee consumption self-picking and take-out scenarios. Coffee is just needed by people who drive long-distance cars, and Yijie uses its own unique store resources and just needed people. From the perspective of industry and consumption, it must be a very feasible operation mode and profit mode.

Today, in some high-speed service areas in Zhejiang, there have been many Starbucks chain coffee shops. Coffee sold in convenience stores is also seizing the new consumption scene of gas stations and service areas. At present, China's expressway service area has basically been undergoing a transformation and upgrading, indicating that the consumer side is constantly pushing the industrial side to innovate and upgrade. Publicly available data show that an average of 64% of gas station revenue in the United States comes from convenience stores; in Europe, the figure is 35% to 40%. Sinopec has more than 30,000 gas stations, and its non-oil revenue in 2017 was 27.6 billion yuan, only 3% of gasoline and diesel retail revenue. It also shows that the proportion of non-oil revenue of gas stations in China is very low, but there is huge room for growth.

Why "even coffee"?

Easy Jie convenience store has also introduced Luckin Coffee before, using the "store in the store" dual-brand model, but this time the launch of an independent brand of easy Jet Coffee, but chose to "show up" for a long time to cooperate with Lian Coffee, the two sides jointly operate EasyJet Coffee. Why did Sinopec choose "Lian Coffee"? According to Sinopec, it is because "Lian Coffee has maintained the annual research and development pace of more than 40 new products in recent years, and has advantages in online marketing."

According to the Beijing Business Daily, Lian Coffee has exported a complete operation team for easy Coffee, which is mainly responsible for the background construction, product development and personnel training of easy Coffee. Sinopec easyJet is responsible for venue support and other brand operation of easyJet Coffee. The supply chain of raw materials is also mostly undertaken by easyJet, and even the coffee R & D team designs and develops products on this basis.

This "co-operation" mode means that Lian Coffee, as the earliest start in the coffee brand melee, began to turn to the B end to move behind the scenes. I believe this transformation of Lian Coffee is directly related to the rise of Luckin Coffee. Starbucks' radical layout in digital is directly related to the cooling of the popularity of Internet coffee so that Lian Coffee has to find a new way out.

At the beginning of this year, even coffee was revealed to have closed a number of stores in Shanghai, Beijing and other places, as well as a large number of shop closures in Guangzhou, Shenzhen and Hangzhou. In response to this, Lian Coffee said it was caused by the active adjustment within the company, mainly the optimization and adjustment of some coffee sites with poor profitability and brand image that did not meet the requirements of development. However, even coffee is not performing well in the capital market, and it is also a reality that it is difficult to obtain a new round of financing. Only by relying on new business forms to improve performance can we catch up with the development of China's coffee market. Today, easyJet Coffee, which is "co-operated" with Sinopec, is an opportunity for even Coffee.

The head of easyJet Coffee said that in addition to gas station stores, easyJet Coffee can also be opened to many offices of Sinopec, banks or insurance company buildings that cooperate with Sinopec, all of which can cover the market by delivery. EasyJet Coffee will also open different types of stores for different regions to serve groups with different spending power and preferences. EasyJet Coffee stores in Suzhou are still in the exploratory stage, and EasyJet Coffee will continue to adjust its products and prices in the course of operation, so there is no clear scale expansion plan for the time being, but what is certain is that Sinopec agrees very much with the cultivation of coffee brands, and it will accelerate the expansion of the market once the easyJet coffee model becomes available in the future.

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