In a significant shift in the global coffee industry, China has eclipsed the United States as the world leader in the number of branded coffee shops. A recent study by World Coffee Portal reveals that China now boasts 49,691 branded coffee outlets, surpassing the 40,062 in the U.S., which had maintained the top position for two decades.
Rapid Growth in China
The coffee shop market in China has seen a staggering 58% growth in the past year, a sharp contrast to the 4% growth in the U.S. This surge has positioned China as a formidable force in the global coffee industry. Jeffrey Young, founder and CEO of World Coffee Portal, emphasized the rapid evolution of the East Asian coffee market, highlighting China’s significant role in this transformation.
Local Chains Driving Expansion
The explosive growth in China’s coffee shop numbers is largely attributed to the aggressive expansion of local chains. Luckin Coffee, established merely six years ago, now operates 13,273 outlets, making it the largest coffee chain in China. Similarly, Cotti Coffee, launched by former Luckin executives in 2022, has rapidly expanded to 6,061 stores.
Starbucks in China
Despite being the first international coffee chain to enter China in 1999, Starbucks is witnessing stiff competition from local brands. In 2023, Starbucks opened 785 new outlets in China, bringing its total to 6,806. Although China remains Starbucks’ fastest-growing market, local chains are rapidly closing the gap.
Regional Competition
The dominance of Starbucks in East Asia is being increasingly challenged by regional players. South Korea’s Mega Coffee, Indonesia’s Tomoro Coffee, and Malaysia’s Zus Coffee are among the domestic brands gaining market share and challenging Starbucks’ regional supremacy.
This shift signifies not only China’s burgeoning love for coffee but also the rise of local brands that are reshaping the global coffee landscape. As these trends continue, the East Asian coffee market, led by China, is poised to redefine the industry’s future dynamics.
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