Charles Lu, the former chairman of Luckin Coffee, and Jenny Qian, the firm’s former CEO, officially announced on October 22 that the first location of Cotti Coffee has opened in the eastern Chinese city of Fuzhou, adding that the “team of coffee dreamers is starting the journey again,” National Business Daily reported.
This brand offers coffee, Italian biscuits and other desserts in the morning, meals during midday, snacks in the afternoon, and wine in the evening. During the World Cup, which will start on November 21, 2022 in Qatar, Cotti Coffee will serve as the sponsor of Argentina’s national football team in China.
The ordering and food delivery mini program of Cotti Coffee have been opened on Tencent‘s WeChat. The new brand has launched more than 40 products, mainly composed of coffee, tea, smoothies and other drinks, priced between 18 yuan and 32 yuan ($2.48 – $4.41). During the trial operation, the preferential pricing of all products is 9.9 yuan.
According to a brand manual of Cotti Coffee obtained by Tech Planet, the company will launch two types of stores in the early stage, namely, standard stores with an area of 80 square meters to 200 square meters and mini stores with an area of less than 50 square meters.
It is worth mentioning that the core management team of Cotti Coffee are basically Charles Lu’s employees from CAR Inc. and Luckin Coffee. Commercial data platform Tianyancha shows that Cotti Coffee (Tianjin) Co., Ltd. was formally established in May this year, with a registered capital of $100 million, and its legal representative is Jenny Qian.
On October 17, Fuzhou Wanglong Cotti Coffee Co., Ltd. was established in Fuzhou, where the first store is located. Tianyancha shows that the company is wholly owned by Cotti Coffee (Tianjin) Co., Ltd.
Cotti Coffee is another brand-new entrepreneurial project by Charles Lu after catering brand Qubayu and pre-cooked food brand “A-Bite Workshop,” which have not caused much attention in the market. The former’s ordering mini program has stopped operating, while many of the latter’s stores are no longer open.
Luckin Coffee, which previously kicked Charles Lu out, has gradually emerged from a haze of financial fraud. By the end of the second quarter, Luckin Coffee had 7,195 stores in China, surpassing Starbucks.
According to a financial report previously released by Luckin Coffee, its revenue in the second quarter of this year was 3.299 billion yuan, a year-on-year increase of 72.4%, while the net profit under Non-GAAP is 268 million yuan.
However, Chinese coffee market is extremely crowded at present. Recently, T97 Coffee has gained popularity due to its livestreaming on Douyin, although its sales volume is mediocre. More Chinese coffee brands are constantly emerging, such as Manner and Saturnbird Coffee. Fortunately for these new firms, the market is still growing rapidly. According to a report released by iiMedia Research, it is estimated that the Chinese coffee industry will maintain a growth rate of 27.2%, and that the domestic market will reach 1 trillion yuan in 2025.