CHINA's big coffee chain, luckin Coffee, plans to enter the US and undercut Starbucks with its low-prices, marking a comeback after a fraud scandal and a Nasdaq delisting and a US$180 million fine, reports London's Financial Times.
The Xiamen-based company is laying the groundwork for a US launch as early as next year, building out its supply chain and customising its technology for the market, according to two people with knowledge of the matter.
The expansion comes nearly five years after it was exposed for inflating revenues after raising $645 million in a US initial public offering in 2019. The fraud led to a wave of investor lawsuits and the company being expelled from Nasdaq.
Luckin's annual revenue of CNY24.9 billion (US$3.5 billion) exceeded Starbucks' in China for the first time in 2023, though Starbucks has fewer outlets and its sales per store in China tend to be higher. The company's revenue rose 35 per cent in the second quarter of this year to CNY8.4 billion, with CNY71 million in net income.
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The Xiamen-based company is laying the groundwork for a US launch as early as next year, building out its supply chain and customising its technology for the market, according to two people with knowledge of the matter.
The expansion comes nearly five years after it was exposed for inflating revenues after raising $645 million in a US initial public offering in 2019. The fraud led to a wave of investor lawsuits and the company being expelled from Nasdaq.
Luckin's annual revenue of CNY24.9 billion (US$3.5 billion) exceeded Starbucks' in China for the first time in 2023, though Starbucks has fewer outlets and its sales per store in China tend to be higher. The company's revenue rose 35 per cent in the second quarter of this year to CNY8.4 billion, with CNY71 million in net income.
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