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September 23, 2021

Yum China and Lavazza to expand cafés network in China

The Yum China and Lavazza joint venture plans to open 1,000 stores in mainland China by 2025.

Yum China Holdings, a licensee of Yum! Brands in mainland China, and Italian coffee company Luigi Lavazza are set to fast track the expansion of the Lavazza cafés network in China through their existing joint venture (JV).

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Under the new expansion plan, the firms aim to open 1,000 Lavazza cafés by 2025, with an initial investment of $200m.

Yum China CEO Joey Wat said: “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.

“Leveraging Yum China’s world-class supply chain, digital capabilities and in-depth knowledge of Chinese consumers, we look forward to bringing Lavazza’s premium and authentic Italian coffee experience and products to even more consumers in China.”

Additionally, the JV is expected to become the exclusive distributor of Lavazza’s global product portfolio, including coffee beans, ground coffee and coffee capsules, across mainland China.

Last year, Yum China and Lavazza Group established the JV, with Yum China owning a 65% stake and the remaining 35% owned by the Italian coffee company.

In April 2020, Lavazza opened its first store outside Italy in Shanghai, China.

Since then, it has opened more than 20 stores across the country, with locations in Hangzhou, Beijing and Guangzhou, as well as further stores in Shanghai.

Lavazza Group CEO Antonio Baravalle said: “The potential for coffee in China is vast; there is a lot of unexplored white space.

“As the largest restaurant operator in China, Yum China is the best partner to further grow the Lavazza brand in this market given its deep understanding of local consumers and market dynamics.”

Earlier this month, Yum China Holdings launched a new campaign to promote balanced diets and healthy lifestyles.

Free Whitepaper
img

What is the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry?

While wanting to protect the country from being overwhelmed by Omicron, China’s adherence to a Zero-COVID policy is resulting in a significant economic downturn. COVID outbreaks in Shanghai, Beijing and many other Chinese cities will impact 2022’s economic growth as consumers and businesses experience rolling lockdowns, leading to a slowdown in domestic and international supply chains. China’s Zero-COVID policy is having a demonstrable impact on consumer-facing industries. Access GlobalData’s new whitepaper, China in 2022: the impact of China’s Zero-COVID lockdowns on economic activity, consumer goods and the foodservice industry, to examine the current situation in Shanghai and other cities in China, to better understand the worst-affected industry sectors, foodservice in particular, and to explore potential growth opportunities as China recovers. The white paper covers:
  • Which multinational companies have been affected?
  • What is the effect of lockdowns on foodservice?
  • What is the effect of lockdowns on Chinese ports?
  • Spotlight on Shanghai: what is the situation there?
  • How have Chinese consumers reacted?
  • How might the Chinese government react?
  • What are the potential growth opportunities?
by GlobalData
Enter your details here to receive your free Whitepaper.

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