The Chinese coffee market is the largest in the world by number of restaurants and shops. Analysts forecast $18.7 billion in sales in 2025 and for the market to grow at a CAGR of nearly 6% through 2030, with urbanization and shifting consumer habits fueling demand. However, intense competition has some of the major players making dramatic moves.
Starbucks (SBUX) is selling a controlling 60% stake in its vast Chinese retail business to Boyu Capital, a Hong Kong-based private equity firm, for approximately $4 billion. Starbucks (SBUX) will retain a 40% minority stake and continue licensing its brand and intellectual property to the new venture, which will oversee nearly 8,000 stores across China. The move reflects declining market share and fierce price competition, as local chains aggressively undercut Starbucks’ prices in a tight economy. The company projects the total value of its Chinese operations will exceed $13 billion, factoring in sale proceeds, its ongoing stake, and licensing revenues over the coming decade.
Luckin Coffee (OTCPK:LKNCY) remains China’s largest coffee chain and is scaling even more aggressively in 2025. The expansion focuses on small-format, digitally driven shops, enabling high operational efficiency and consumer personalization through its app-based engagement strategy.
Cotti Coffee, founded in 2022 by Luckin ex-executives, is executing hyper-aggressive expansion with ambitious goals to reach 50,000 stores by the end of this year, up from roughly 10,000 in late 2024. The Hong Kong-based company’s latest strategy involves opening ultra-compact convenience stores (as small as 3–5 square meters) featuring not just coffee but typical convenience products like ice cream, noodles, and snacks, which results in greater flexibility and lower startup costs.
Manner Coffee is a rapidly growing boutique chain that began in Shanghai in 2015 and now has over 1,000 stores, primarily concentrated in urban centers like Shanghai, Beijing, and Shenzhen. Manner is known for its minimalist store design, affordable pricing, and a strong sustainability focus, offering discounts for customers who bring their own cups. The brand has gained popularity among young professionals, in particular, for serving high-quality espresso-based beverages, especially flat whites, in compact locations in transit corridors and shopping centers.
Other notable coffee chains in China include Coca-Cola’s (KO) Costa Coffee, NOWWAA Coffee, Tims China (THCH), M Stand, and Pacific Coffee.