If you follow news about developments in the coffee and coffee shop industry then you may have seen recent articles about the growth of coffee shop culture in China, in particular about the rapid growth of Luckin Coffee, (a Beijing based start-up that aims to overtake Starbucks), the ambitions of Canadian chain Tim Horton’s to expand into the Chinese market, or the reflections of Howard Schultz on the future of Starbucks in China. All of these articles highlight how China is seen as a potential area of growth for the coffee shop industry.
The growth of coffee culture in China, and the challenges and opportunities for coffee shop businesses aiming to operate in this region of the world is the topic of focus for a recent article published in the journal Business Horizons.
The article ‘Challenges and opportunities of new retail horizons in emerging markets: the case of a rising coffee culture in China‘, written with my co-author Dr Carlos Ferreira, examines the growth of the coffee shop industry in China. It considers the key dynamics and drivers in order to address questions about successful retail expansion in emerging markets. It explores how changing consumer cultures have contributed to a rapidly growing industry and what strategies have been used to enter the market and maintain growth.
It begins by considering existing literature on emerging market opportunities and in particular the transformation fo retail and consumption in China, the rising middle class and the growth of ‘third spaces’. This leads into an overview of the growth of coffee shops in China with a timeline of Chinese coffee and coffee shop culture up to the introduction of third wave specialty coffee shops. It then presents the opportunities and challenges for different types of coffee shops aiming to engage in the Chinese coffee shop market before considering strategies for future growth, and the importance of a future research agenda around the growth of coffee and coffee shop culture in China.