Cotti Coffee is a Chinese coffee chain founded in October 2022. It was established by Mr. Lục Chính Diệu and Mr. Tiền Trị Á, who previously co-founded Luckin Coffee, the largest coffee brand in China. Cotti Coffee offers a selection of high-quality Arabica coffee beans, with their Sirius coffee beans winning the IIAC 2023 International Coffee Award and the Gold Award as the top choice.
As of December 2023, Cotti Coffee has expanded to 6,000 stores across China. To further expand globally, Cotti Coffee has opened stores in countries such as South Korea, Japan, Indonesia, Canada, and most recently, Vietnam.
Cotti Coffee currently has 5 branches in Vietnam.
In December 2023, Cotti Coffee officially entered Vietnam with 3 branches in Ho Chi Minh City. The coffee chain then opened 2 more branches in Hanoi.
Recently, on March 10, Cotti Coffee announced a total of 7,000 stores worldwide. Cotti Coffee began its global expansion in 2023, targeting markets in Southeast Asia, East Asia, North America, the Middle East, and Australia. With operations in 28 countries and regions worldwide, the coffee chain has experienced rapid growth in brand scale and market share.
Serving different countries and regions, Cotti Coffee introduces regional specialties such as Vietnamese Coffee, Matcha Oat Latte, Coco Cotti, Lychee Milk Frappé, and Sparkling Cold Brew. All of these offerings have been well-received.
In just 13 months on the market, Cotti Coffee has already established a presence in 300 major cities worldwide. It is projected that the fourth-largest coffee chain in the world will expand to the United States, Japan, South Korea, Indonesia, and Canada in 2024. Additionally, Cotti Coffee plans to open 9 more stores in Vietnam.
Cotti Coffee store opening in Duy Tan, Hanoi.
Despite being less than 2 years old, Cotti Coffee has quickly become a prominent player in the coffee industry. In Vietnam, in addition to coffee, the brand also sells popular drinks such as milk tea and fruit tea, with prices ranging from 20,000 to less than 50,000 VND per cup.
Similar to its previous venture, Luckin Coffee, Cotti Coffee implements strategies to rapidly expand its store network. The brand offers deep discounts, with an average drink price of approximately $1.38 per cup, which is later reduced to $1.22. New customers can also purchase their first cup of coffee at Cotti Coffee for a minimal price of $0.14.
Will Cotti Coffee achieve success in Vietnam like Mixue?
A Cotti Coffee shop in Gangnam, Seoul. Photo: Cotti Coffee
Similar to Mixue (a Chinese brand that became the world’s fourth-largest F&B chain), Cotti Coffee also follows a franchising strategy. According to Dân trí, Cotti Coffee requires an investment of approximately 1.1 billion VND for investors to partner with the brand. This includes around 700 million VND for coffee machines, refrigerators, printers, screens, and WiFi devices; more than 200 million VND for bar counter design and signage; 170 million VND as a deposit for raw materials, and approximately 17 million VND for store design under 80 square meters.
Cotti Coffee’s rapid expansion in brand scale is closely linked to its innovative brand management model. Instead of using traditional direct management or franchising methods, the brand has implemented a new partner mechanism to optimize the supply chain strength and IT technology of Cotti Coffee, enabling the realization of overall system digitization. This allows both parties to maximize their respective advantages through cooperation.
Cotti Coffee currently has 7,000 stores in over 300 major cities worldwide. Photo: Cotti Coffee
In January 2024, Cotti Coffee introduced another significant development by launching a human-robot collaboration strategy and announced widespread robot applications in their stores worldwide.
Experts believe that although Cotti Coffee has experienced explosive growth in China and other countries, it will face competition in Vietnam from local coffee chains such as Highlands Coffee, Trung Nguyên Legend, Phúc Long, and The Coffee House. Furthermore, Cotti Coffee has the disadvantage of having an indistinct store design that lacks aesthetic appeal and does not specifically target a particular customer segment.
Therefore, the reality is that Cotti Coffee needs to make adjustments to better adapt to the Vietnamese market. The F&B market in Vietnam has a scale of 610,000 billion VND (2022 data) and is predicted to reach 1 million billion VND by 2026. However, establishing a strong presence in the market is not an easy task. Many foreign coffee chains have previously had to leave the market, such as New York Dessert Coffee and The Coffee Bean & Tea Leaf.
Article references/sources/images: Momentum Works, Business wire, World Coffee Portal
