Starbucks finally meets its match in China

Its name is Luckin Coffee, it has opened about 500 outlets since its launch earlier this year, and it is reported to be worth over $1 billion, making it China’s first coffee unicorn.

Jeffrey Towson of Peking University has been asking for years why Starbucks doesn’t have a serious competitor in China. Well, now it does.

Naturally, Luckin doesn’t have cash registers and you have to order through their app and pay through China’s mobile panopticon of WeChat/Alipay or the company’s own payment function.

“My take is their big weapon is digital + lower prices + tons of locations,” according to Towson. Is this the Starbucks killer?

Luckin Coffee has the stated goal of beating Starbucks, but even without doing that, they can potentially build a profitable business by getting more Chinese to drink coffee. The current per capita average is four to five cups per year.

 

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