May 5th Shopping Festival | Shanghai Coffee Shop Speculation: Will it surpass 10000 this year

In 2023, there were a total of 9553 coffee stores in Shanghai, an increase of 1023 compared to last year, and the total number of stores continued to lead the country.

Recently, as one of the benchmark activities of the “May 5th Shopping Festival”, the main market of the Shanghai International Coffee Culture Festival, the largest and most distinctive “Coffee+Cultural, Sports, Tourism and Business Exhibition” carnival in the city was held on the west bank of the Xuhui Riverside. With a 1.5-kilometer waterfront and 17000 square meters of riverside space, a 5-day carnival event gathers over 180 coffee market booths, showcasing rich elements such as coffee, flower exhibitions, cultural tourism, sports, performances, and commercial brands to the public.

In Shanghai, coffee has already permeated every aspect of lifestyle, becoming an essential daily companion for many professionals. And coffee shops not only provide convenient beverage services, but also become important places for professionals to communicate, negotiate, and rest. On the west bank of Xuhui, by the riverside, Starbucks’ “Yilan Duo Mobile Coffee Car” is a stunning sight. In addition to the star creative new product Yilan Duo, the “Coffee Fast” service also makes the coffee experience for customers more efficient.

According to the “China Urban Coffee Development Report” hosted by the Shanghai Cultural and Creative Industry Promotion Association, the total number of coffee stores in Shanghai in 2023 was 9553, an increase of 1023 compared to last year. As of March 2024, there were a total of 52308 domestic chain coffee stores, with a CR10 of 77%. Luckin ranks first with 35% of its stores, Starbucks accounts for 14%, and Coodie accounts for 12%.

Shanghai’s coffee delivery consumption accounts for over 20% of the total consumption in the country, making it the city with the highest coffee delivery consumption in the country. The trend of coffee delivery consumption reflects Shanghai’s unique urban lifestyle.

The above report also shows that, taking Shanghai as an example, the Shunchang Road commercial district in Huangpu District has the highest coffee delivery order density index, reaching 13.86, followed closely by the Yuntai Road commercial district in Pudong New Area, with an index of 12.39. These two commercial districts respectively represent the central living area and high-end business district of Shanghai, gathering a large number of workplaces, shopping centers, and residential areas, making them high-density areas for takeout orders.

In 2023, the scale of China’s coffee industry reached 265.4 billion yuan, and it is expected to increase to 313.3 billion yuan in 2024, with an average compound annual growth rate of 17.14% in the past three years. Compared to the per capita annual coffee consumption of 9 cups in 2016, the per capita annual consumption in China has increased to 16.74 cups in 2023. But there is still a gap with the world’s major coffee consuming countries.

From the opening plans of various brands in the industry, it can also be seen that the scale of the coffee industry is still expanding, and the form of stores is constantly updating.

The “Partner Project” of Tims Tianhao China has gradually been implemented. As of now, 8 partner stores have been opened in cities such as Shanghai, Jiaxing, and Hangzhou, with over 2500 potential partners applying for cooperation. Among them, more than 50 stores have reached intention to sign contracts, and it is expected that the number of partner project stores will continue to increase in 2024. Tim Tianhao Coffee has also reached a cooperation agreement with Shentong Metro to open a store on the platform of Shanghai Metro Line 14, providing a convenient new choice of “coffee+warm food” for commuters taking the subway.

The latest financial report shows that KFC’s coffee brand KCOFFEE is accelerating its development, and “Kenyue Coffee”, which adopts a shoulder to shoulder model, is an independent store of KCOFFEE. Kenyue Coffee has a unique storefront, dining area, and menu, while sharing equipment with KFC stores, allowing Kenyue Coffee to utilize KFC’s equipment to provide some products. At present, Kenyue Coffee has more than 80 cities and 100 stores, and the company will vigorously promote this store model.

Zhu Danpeng, Vice President of Guangdong Food Safety Promotion Association, analyzed to First Financial reporters that in the Chinese market, the density of coffee shops in Shanghai is the highest. Based on the current situation, it is inevitable that the number of coffee shops will exceed 10000 within the year. It is expected that the coffee market in China will continue to grow in 2025.