Malaysian media reports suggest the Chinese coffee giant will partner with a stock-exchange-listed franchisee to enter Malaysia, which has become an increasingly popular market for international coffee operators
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Luckin Coffee currently operates 32 international stores – all in Singapore | Photo credit: Erdeni Aisingioro
Fast-growing Chinese operator Luckin Coffee is reportedly poised to enter Malaysia in partnership with an unnamed Bursa Malaysia-listed franchisee.
Selangor-based financial news outlet The Edge quoted sources as saying Luckin Coffee will pursue rapid outlet growth in Malaysia over the next five years in a bid to scale its international footprint – which currently comprises 32 stores in Singapore.
A letter of intent will be signed soon with a master agreement expected to be finalised in July 2024, sources close to the matter said.
Luckin Coffee, which operates more than 18,500 stores in China, posted a RMB 65.1m ($9m) operating loss for the three months ended 31 March 2024 – its first quarterly loss in two years – amid a fall in sales during the period.
Malaysia has seen a flurry of international café operators enter the market over the last 12 months, including UK-based EL&N, Thai milk tea and coffee chain ChaTraMue, US specialty roaster Reborn Coffee, boutique café and dining concept Café Kitsuné and Luckin Coffee rival Cotti Coffee – which now has five stores in the country.
The Malaysian branded coffee shop market, which comprises more than 3,300 outlets, also has a growing domestic segment, with ZUS Coffee, Gigi Coffee and Bask Bear Coffee among those to have significantly scaled their footprints within the last year to reach 443, 143 and 103 stores respectively.
World Coffee Portal’s Project Café East Asia 2024 report forecasts the total Malaysian branded coffee shop market will reach 6,100 outlets by the end of 2028.