The Trend Of Small Coffee And Big Coffee In China

Starbucks, known as the "little coffee" model, is not easy to live in the Chinese market. The "big coffee" model represented by the Shang island mode is encircling Starbucks and has become the mainstream of the coffee chain.

Experts said that compared with Starbucks's only high degree of unity of coffee products and site selection, Shang island mode is more capable of survival in the local market.

In the long run, Starbucks's "pure western fast food" mode can only be the worst policy of domestic coffee chain operations.

The "big coffee" has attracted the attention of investors. At the same time, Starbucks has begun to taste bitterness.

At the end of last year, DIO restaurant got a $21 million investment in Carlyle, and plans to expand its stores to 1000 in 5 years. In April this year, the two sides of the Straits with 75 stores and 400 stores also received $30 million from the joint venture of Goldman Sachs and Wahson capital. At present, the cross straits coffee plan is extended to 150 stores by the end of 2008, and 1000 stores are opened by 2010.

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In recent years, DIO's profit margin has maintained a two digit growth, attracting Carlyle.

Meanwhile, Jin Meiyang, President of the cross strait coffee company, also said that before some investment institutions came to the door, they chose the Goldman Sachs and Wahson capital in order to introduce the business philosophy and structure of large enterprises as soon as possible, and will be listed on A shares in the future.

Pei Liang, Secretary General of the China Chain Association, told reporters that at present, the larger chain coffee companies such as the island, the two sides, the DIO and the real pot have already embarked on a completely different mode of operation with Starbucks.

"In the industry, the Starbucks model is called" little coffee ", and the Shang island mode is called" big coffee ", and" big coffee "has become the mainstream of coffee chain.

The so-called "big coffee", in fact, is a "coffee + western style leisure restaurant" model, the store not only business coffee products, but also the introduction of various western style, Chinese food, even the soup noodle, vegetable porridge such "soil flavor" include.

Li Weihua, an associate professor at the Business School of China University of Political Science and Law, said that in fact, this chain store is the fusion of many kinds of restaurants in the name of coffee.

"In the domestic market, it is a bad idea to be a pure westernized coffee shop. It is the best policy to make some changes in the local market."

In addition to the inclusiveness of the food category, the Shang island mode also has an advantage in market adaptability.

All along, Starbucks's location is commendable, and it is an important weapon for Starbucks to block competitors by setting up stores in the essence of metropolitan areas.

The enterprises in the Shang Dao mode avoided the position of Starbucks and focused their attention on the urban and rural joints and the two or three tier cities in China.

The location of the pot coffee is usually close to the large community or the relatively partial business district, which largely reduces the cost of property.

The cross strait coffee is based on the western and central regions, and then expands the North China market headed by Tianjin.

Yang Xiaolan, deputy general manager of DIO coffee, said that the site selection of DIO urban and rural joints is one of the manifestations of differentiated management.

She believes that for some business people, after lunch, it will take quite a long time to negotiate business. They prefer to drive to a quiet place not far away, while coffee shops in downtown areas can only allow guests to take a short rest.

Ye Zhenggang, a brand marketing expert, said Starbucks's positioning is "a place to rest between customers and offices," but it is also inevitable that there will be loopholes in "customer experience", such as too long waiting time, too often no place to sit, and so on, which will affect customer loyalty. Other coffee companies will find opportunities to qualify.

Many markets have spawned innovation models. Experts say that massive market and diversified consumption demand are important conditions for the rapid development of the island.

According to statistics, since 1998, the annual consumption per capita of China's coffee consumption market has increased by 30%.

It is estimated that by 2020, the total consumption of China's coffee market will reach 50 billion dollars, and the market space derived from the whole industry chain will have hundreds of billions of dollars.

International coffee organization responsible person said, the Chinese market has shown signs of rapid development trend, and will become an important coffee consumption market in the world.

At the same time, the diversification of the Chinese market is also very obvious. The consumption ability and consumption habits of different regions are uneven, which has become a problem that coffee chain enterprises must face.

In view of this, the enterprises in the Shang Dao mode began to differentiate from Starbucks in terms of price, service and so on, so as to achieve market segmentation.

The pot chose the route of the high priced coffee chain store, mainly serving the bosses, while DIO emphasized the fine service, requiring the staff to improve the customers' sense of respect in the store before the guests opened their mouth.

Li Weihua said, Starbucks is more western style fast food style, but in the consumer environment is mild, and local flavor, not as good as the island coffee shop.

However, the Shanghai Island model is not unassailable.

"Big coffee" often occupies a larger area. It will face challenges in terms of rent, consumption behavior change and profitability in the future.

Pei Liang said that the ideal mode in the future is a "mini" coffee casual restaurant between Starbucks and Shanghai Island, but it is more diverse in function -- gathering coffee, restaurants, bars and so on.

This innovative coffee chain model will most likely come first in the first tier cities, as the Starbucks style post-80s consumer group has become increasingly mature, and they will become the "mini" innovation mode of spawning.

In the two or three tier cities, the Shanghai Island mode will continue for quite a long time.

Besides, the loose management is also an urgent problem for the island.

Experts say, "even but not lock" is a difficult yardstick. In order to meet the needs of different regions, franchisees are flexible to deal with.

Yang Xiaolan said that at present, when DIO examines franchisees, apart from its economic strength, it will also focus on the personality traits and business philosophy of franchisees, so as to ensure their continuous operation in their ideas and capabilities.

The overly dependent "employee" franchisee and the overemphasis on independent "entrepreneurial" franchisees are not ideal candidates for DIO.