Why can't Chinese teahouse brands compete with coffee shops such as Starbucks?

Xiao Xia, a text editor who works for a magazine in Hangzhou, patronized Starbucks' Xihu Tiandi store again on Sunday. If the lead reporter remembers correctly, this is the third time she has visited the same Starbucks store this week.

When it comes to love for Starbucks, Xiao Xia makes no secret. "Starbucks' overall decoration style is petty bourgeoisie and elegant. Through the big floor-to-ceiling windows, you can see the beauty of Jinxi Lake, and all kinds of tourists on Nanshan Road opposite are also a unique scenic line. Order a cup of mocha, a person surfing the Internet, editing, three or two friends get together to chat, very relaxed and casual. "

If it were not for the release of the Comprehensive report on Chinese Teahouses & Cafe consumers and Industry, perhaps many domestic consumers, like Xiao Xia, do not feel that frequent visits to their favorite cafes will have any impact on the domestic teahouse industry as the host country of tea production.

A report that surprised the host country last week, the number of cafes in China nearly doubled from 15898 in 2007 to 31783 in 2012, according to a report released last week by Mintel, a global professional market research firm. In sharp contrast to the rapid development of cafes, teahouses have increased by only 4% over the same period. And so far, no teahouse brand has become a competitor comparable to Starbucks.

"as the host country of tea, this is worth pondering." MatthewCrabbe, director of Asia Pacific Research at Mintel, said that the coffee chain only officially entered the Chinese market in the late 1990s, but due to the large-scale expansion of coffee retail giants in China and the birth of a new generation of coffee lovers, the Chinese coffee market ushered in an unprecedented spring.

The development of Starbucks reflects the whole coffee chain industry in China. According to the reporter of the leading newspaper, Starbucks entered the Chinese market in 1999 and expanded rapidly at the rate of opening a new branch every day after opening its first store in Beijing. Statistics show that since it went public in 1992, its sales have grown by an average of more than 20% a year, and its profits have grown by an average of 30%. Mr. JohnCulver, president of Starbucks China and Asia Pacific, even said that Starbucks will open 1500 stores in China in 2015 and hopes to enter more cities, especially second-and third-tier cities in the future.

The development of Chinese brands related to coffee, including cross-strait coffee and Dior coffee, has been going smoothly.

The report also showed that 12 percent of respondents from cities said they had been to a cafe "at least once" in the past year, and 20 percent said they had "been to a cafe at least five times." only 5% said they had "not consumed any products in any cafe". In contrast, although 70% of urban consumers said they had the habit of drinking tea, only 20% of urban consumers said they had been to a teahouse. Teahouses and cafes are the priority in the minds of domestic consumers, the release of the data can be seen.

But what worries teahouse practitioners even more is that at the same time, coffee chains led by Starbucks have begun to sell Chinese tea, which is undoubtedly "even worse" for traditional teahouses. "they sell tea drinks to win the favor of the broad masses of young consumers, but also provide more choices." According to statistics, 23% of Chinese consumers choose to buy tea drinks in cafes. However, going to cafes to drink tea is undoubtedly ironic to domestic teahouses: why can't Chinese consumers go to teahouses for coffee?

The coolness of teahouses in Hangzhou, as one of the top ten famous teas in China and the producing area of China's well-known trademark "Xihu Longjing Tea", teahouses have long felt the coolness, although the overall business situation is obviously better than that of other cities, and the number of teahouses is also relatively large. Ten teahouses, including Qingteng Teahouse, Qingyuan Teahouse and Lakeside Teahouse, are among the ten most popular teahouses in Hangzhou, but the once-famous door-ear teahouse (Ruyi Square) closed at the end of September last year.

To investigate the reasons for its closure, Hangzhou media have interviewed Ni Wen, chairman of Hangzhou Mener Tea Factory Tea Co., Ltd. He said that every industry is faced with these problems, such as rising rents and rising staff wage costs, which has led to a decline in the development of the teahouse industry in Hangzhou, and the loss of tea guests is the crux of the problem.

According to the reporter of the guide, the teahouse industry in Hangzhou, especially the self-service teahouse, reached its peak from 1999 to 2003. there are more than 800 teahouses throughout Hangzhou, with an average business area of more than 1000 square meters. At that time, there was a big discussion inside and outside the industry because of the high gross profit of the teahouse industry. But since 2004, with the rise of new leisure services such as KTV and foot bath, some tea guests who do not come because of tea have left. Most of the tourists were diverted, and the operation rate of self-service teahouses began to decline. At this time, cafes began to rise in Hangzhou. The head of a teahouse once said that more than 50% of the cafes in Hangzhou serve tea and divert customers.

(responsible Editor: Leo)