How Luckin Coffee overtook Starbucks as the largest coffee chain in China
Summary
"They are very aggressive in store expansion and in China, it is very common to buy a drink from Luckin for $2 or less after heavy discounts," said Jianggan Li, founder and CEO of tech research company Momentum Works. China is traditionally a tea-drinking market, but over the last few years, coffee sales have been increasing steadily, especially in urban areas and among younger professionals. Chinas overall coffee sales will rise at an 8.7% compound annual growth rate (CAGR) from 2022–2027, according to analytics firm GlobalData. The Chinese coffee chain expanded to Singapore in March in its first international foray and has opened 14 stores in the city-state so far, according to a CNBC check. "Luckin was able to expand so fast because of its operating model — which includes self-operated stores and franchises," said Li of Momentum Works.