Chinese coffee startup Luckin announced on WeChat that it plans to open stores in 15 more cities in China by the end of April. In the first two months of this year, the company entered Yangzhou, Changzhou, and Foshan. Other cities that the company will expand to include Hefei, Guiyang, Wenzhou, and others—all informally called tier-two cities in China.
If all goes according to schedule, Luckin will be in 40 Chinese cities before mid-2019. This is part of Luckin’s plan to displace Starbucks and become China’s largest coffee chain in terms of the amount of coffee sold and the number of stores.
Starbucks has come a long way since its entry into China two decades ago. As of 2018, it had 3,600 locations in the country, and it plans to increase that number to 6,000 by 2022.
In the first nine months of 2018, Luckin posted a net loss of RMB 857 million (US$126.7 million) as it splurged heavily on customer discounts, marketing campaigns, and store expansions.
Over a six-month period last year, Luckin raised US$400 million in two financing rounds. It has plans for an IPO in Hong Kong.
Editor: Brady Ng