Chinese coffee giant Luckin Coffee is poised to make its debut in Malaysia, marking a significant step in its international expansion strategy amid fierce market competition. This entry into Malaysia comes at a time when local consumers have a wide array of coffee choices, partly due to ongoing consumer boycotts against Starbucks over Middle East tensions.
Luckin Coffee to embark on international expansion in Malaysia
Luckin Coffee’s strategic move into Malaysia involves a partnership with a Bursa Malaysia-listed firm. This local collaboration is part of an ambitious five-year expansion plan, aiming to establish a strong presence in the Malaysian market. Sources reveal that a letter of intent will be signed soon, with the master agreement expected to be finalised within the next two to three weeks.
Founded in 2017 and headquartered in Xiamen, Luckin Coffee has rapidly grown to operate 18,590 stores globally, excluding unmanned machines, as of 31 March this year. In China alone, the company has achieved remarkable growth, opening 2,340 new stores in the first quarter of this year, bringing the total to 18,558 stores—12,167 of which are self-operated, and 6,391 are partnership stores.
Despite facing a major setback in 2020 with revelations of accounting fraud, which led many to believe the company was finished, Luckin Coffee has made a remarkable comeback. The company has not only survived but thrived, outpacing Starbucks to become China’s largest coffee retailer last year.
Once mocked as a cheap imitation of Starbucks, Luckin Coffee is now setting trends that other Chinese coffee chains are emulating. Even Starbucks appears to have adopted some of their innovative strategies.
One of the most notable successes for Luckin Coffee was the launch of the Jiangxiang flavoured latte in collaboration with Kweichow Moutai Co Ltd in September 2023. This unique offering became an instant sensation, selling 5.42 million cups on its debut day and generating sales that exceeded RMB100 million (approximately RM64 million). By the end of the year, the Jiangxiang flavoured latte had sold 45.83 million cups, with total sales surpassing RMB900 million (approximately RM583 million).
Luckin Coffee’s international ventures began with its expansion into Singapore, where it currently operates 32 stores. With the upcoming Malaysian debut, the Beijing-based company aims to further expand its international footprint. The move is expected to introduce Malaysian consumers to Luckin’s popular and innovative coffee offerings, further diversifying the local coffee market.
(Hero and feature images credit: Instagram/ @luckincoffeesg)
