China Now Has The Most Chain Coffee Shops In The World

Walk down any city block in America and you're bound to wander past a coffee shop, whether it's independently run or an outlet of a major chain. After all, we do love our caffeine, our routine, and our Frappuccinos. Now, though, CNN reports that even though the United States has an immense amount of branded coffee chains, we've been unseated by a country that's more known for its love of tea than coffee: China has just taken the title for most branded coffee outlets in the world.

A report from the World Coffee Portal says that despite Starbucks' recent efforts to expand its footprint in China, it's going to be a while before the brand might be considered a heavyweight in that market.

The report says that China's coffee outlet volume grew by a staggering 58% over the past 12 months to reach a total of 49,691 units. Two brands led the aggressive expansion: Cotti Coffee, which added 6,004 new stores, and Luckin Coffee, which added 5,059.

Considering where Luckin Coffee was just a few years ago, it has made a stunning comeback. In 2020, it was revealed that prior to its initial public offering in 2019, Luckin had fabricated transactions to make the brand appear more successful than it actually was. The IPO ended up raising $651 million, but later it was discovered that executives had faked sales to the tune of $310 million by selling tens of millions of cups to companies tied to then-CEO Charles Lu. Lu was fired, along with other executives tied to the matter.

Apparently the public's memory is very short, or Chinese consumers are willing to let bygones be bygones, because Luckin's numbers—which are now apparently real—show strong growth nationwide.

The World Coffee Portal Report states that Starbucks is still the largest branded coffee shop in East Asia, with a total of 13,524 stores in the region. But the competition is fierce, and other brands local to Asia are making some money moves by expanding there as well. Starbucks wants to move fast in China, however, hoping to reach 9,000 locations by 2025.

In the debate of hot coffee versus cold (team cold here—I like to chug), a survey of 4,000 Chinese coffee consumers indicates that over 90% prefer it hot and drink it weekly. Still, 64% of those surveyed enjoy iced coffee at least once a week. The average price of an Americano in China, South Korea, Japan, and Thailand will run you an affordable $2.70.

This is the first time the United States has been bumped down to second place in branded coffee shops in at least 20 years, since the World Coffee Portal started tracking this information. It's looking like East Asia really loves its coffee, and a big battle between the brands is already heating up.