Italian coffee roaster and quick-service restaurant group, Yum China, announce plans to significantly scale Lavazza's premium coffee shop concept across China and extend existing partnership to include product distribution
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Lavazza and Yum China aim for 1,000 Lavazza Cafés in China by 2025 | Photo credit: Lavazza
Lavazza and China’s largest restaurant company, Yum China, say they will accelerate plans to open Lavazza Cafés in China.
According to a press release, the two companies will invest $200m to grow Lavazza’s premium coffee shop concept to 1,000 stores by 2025 via a joint venture first announced in May 2020.
The partnership, in which Yum China holds a 65% stake, with Lavazza controlling a minority 35% stake, will also involve the exclusive distribution of Lavazza's retail products in mainland China, including coffee beans, ground coffee and coffee capsules.
According to Yum China CEO, Joey Wat, the partnership will leverage the restaurant group’s world-class supply chain, digital capabilities and in-depth knowledge of Chinese consumers to introduce a wider range of products from Lavazza’s global portfolio.
"The recent progress of Lavazza cafés in China has been encouraging and reaffirms our belief that our partnership is well positioned to capture the significant coffee opportunity in China with accelerated store network development. We are excited about what the future holds for this iconic Italian brand," said Joey Wat, CEO of Yum China.
Yum China currently operates more than 10,000 restaurants, in over 1,500 cities and towns, covering every province and region across mainland China. The restaurant giant also holds the license for prominent international brands including KFC, Pizza Hut, and Taco Bell.
Lavazza launched its first flagship store in Shanghai in April 2020. The company has opened more than 20 stores across China in Shanghai, Hangzhou, Beijing and Guangzhou.
China is rapidly developing into one of the most opportune coffee markets in the world. As such, the country presents lucrative opportunities for international brands seeking to grow their footprint in East Asia.
World Coffee Portal data shows that despite pandemic disruption, China’s branded coffee shop market grew 2.9% to exceed 21,400 outlets in 2020.
Highlighting Lavazza’s ambitions in the premium coffee shop market, the company is also launching a new flagship store in central London. Scheduled to open late September 2021, the site comprises three floors and is located opposite the prestigious department store Liberty.