After the Kopi Luwak acquisition: coffee accompanies you with more than 1 billion debts, aiming at ZOO COFFEE.

[abstract] CA sir learned exclusively that the long-rumored case of "Kopi Luwak picking up a plate of coffee to accompany you" eventually aborted because you were too heavily in debt (more than 1 billion).

Ka sir learned exclusively that the long-rumored case of "Kopi Luwak picking up a cup of coffee to accompany you" eventually aborted because the coffee accompanied you was too heavily in debt (more than 1 billion).

Kopi Luwak has instead turned to buying ZOO COFFEE, another well-known Korean coffee chain.

What kind of chess is Kopi Luwak playing behind the successive acquisition negotiations?

Jia sir had a conversation with Mr. Xu Jiachen, CEO of Kopi Luwak, to reveal the behind-the-scenes story of this legendary brand acquisition.

Give up the cup of coffee to accompany you

In early November, Shamian Island, on the banks of the Pearl River.

This small island, which was once leased by Britain and France, is worthy of the reputation of Guangzhou as "Xanadu".

No. 1 Shamian Street on the island is the headquarters office of Kopi Luwak.

In the office, Kopi Luwak CEO Mr. Xu Jiachen solemnly told sir: Kopi Luwak has officially decided to give up the cup of coffee to accompany you.

In June this year, when coffee accompanied you into a stalemate with a broken capital chain, coffee accompanied you to send a Wechat message to your partner:

"after many days of efforts by CEO Qi Dong, we have finally achieved the strategic cooperation between Kopi Luwak and Coffee to accompany you.

In this strategic merger and acquisition, Kopi Luwak, with a number of strategic investors, will join the coffee company to accompany you for more than a month of audit evaluation, which will help coffee accompany you to bear the recognized debt and reshape your brand image. "

The matter caused a heated discussion in the industry and the media, and then there was no more.

Xu Jiachen told sir that after an internal discussion after the asset evaluation of the coffee company, Kopi Luwak finally gave up the acquisition plan.

There are two main reasons:

First of all, the debt is more than 1 billion.

"I thought you would have a lot of debt with coffee, but I didn't expect it to be so much."

Kopi Luwak told sir that the audit estimated the figure to be more than 1 billion. This far exceeded Kopi Luwak's expectations.

Second, it is difficult to reverse the damage to the brand.

High debt makes coffee accompany you with problems in the supply of raw materials. Due to the lack of supply of goods, pure join stores can only rely on their own research and development products, their own business. Many franchisees said, "the heart of the franchisee is very cold."

As a chain brand, consumers may see completely different product lines in An and B stores. There are even rumors in the industry that "Xi'an coffee will accompany you to sell Pita Bread Soaked in Lamb Soup". Xu Jiachen believes that this is an irreparable blow to a chain brand.

At present, cat shit has only bought coffee to accompany you to eight stores, which will be operated by Kopi Luwak. In the future, some stores will be acquired sporadically as needed, but it will no longer be considered from the company level as a whole.

Aim for ZOO COFFEE

Mr. Xu Jiachen told sir that Kopi Luwak is now turning to buying ZOO COFFEE, another well-known Korean coffee chain.

ZOO COFFEE and coffee accompany you in the business model, but the brand is on the rise.

According to Mr Ka, ZOO COFFEE was born in South Korea in 2009. It is interesting to note that ZOO COFFEE joined the business immediately after the first store opened, expanding to 100 stores in less than two years.

In 2013, zoo coffee opened a franchise store in China, and now there are more than 160 stores in China.

Not long ago, zoo coffee was closed for transfer on Zhengzhou Agricultural Road. Because it is a franchise store, its recharge card can not be used in other stores, resulting in no way for consumers holding recharge cards to complain.

Kopi Luwak said the acquisition was still in the planning stage and had not yet entered formal negotiations. ZOO COFFEE also told sir that he had not heard of the relevant news.

After the acquisition

Why is Kopi Luwak so interested in buying coffee chains?

Ka Sir believes that there are three answers: snatching the wind outlet, grabbing capital, and stabilizing the brand.

The tuyere is coming.

Many people in the industry have told sir that in the next 5-7 years, the coffee market will usher in a blowout period and will enter a golden era.

China is expected to become the world's largest consumer of coffee in 2020, according to the Boston Consulting Group.

Seduced by the big cake of the Chinese market, there has been fierce competition among coffee giants. Especially the coffee chain enterprises, accelerating the layout in advance in the market tuyere period is the strategic deployment to seize the market opportunity.

Starbucks proposes to double its stores in China in the next four years. Domestic quality stores and cat droppings have also joined the ranks of the army.

Beach capital

In addition to the market tuyere, Kopi Luwak also faces capital tuyere. The NASDAQ listing Plan 2017 is an important step in its development strategy.

On November 11, the original equity subscription meeting for the listing of Kopi Luwak was held in Beijing.

"as soon as Nasdaq goes public, Kopi Luwak will quickly expand its stores to 1500." Xu Jiachen said.

In fact, it was because the pace of opening stores could not keep up that Kopi Luwak delayed its listing scheduled for 2016 to 2017.

Kopi Luwak, which has been established for 4 years, currently has 116 stores, half of which are directly operated, and it is advancing at the rate of 30 stores a year.

The acquisition of coffee chain brands has become an important step in accelerating the opening of Kopi Luwak stores.

Steady brand

The legend of Kopi Luwak has contributed to the growth of a minority category in the coffee industry into a well-known domestic coffee chain brand.

But at present, it seems that the double-edged sword of brand story has begun to eat back the benefits it brought earlier.

In early November, the British BBC made a documentary about Kopi Luwak in Indonesia, which trapped the origin and quality of Kopi Luwak.

In addition, on the Internet and Weibo, "truth revelations" about Kopi Luwak's cat abuse abound.

In this case, the acquisition of ZOO COFFEE with similar business model but different positioning and target audience has become an important strategic layout for Kopi Luwak's diversified operation and sound brand.

Source: Huashang website