Luckin Coffee Plunging into India, Middle East
Chinese startup Luckin Coffee is making its first move outside its borders, with plans to open coffee shops in the Middle East and India.
Luckin, which raised $561 million in May in a U.S. initial public offering, announced in mid-July that it had signed a memorandum of understanding to set up a joint venture with Kuwait’s Americana Group to launch the business in the Middle East and India regions.
Americana Group, founded in Kuwait more than 50 years ago, operates 1,800 restaurants and 29 food production sites in the Middle East and North Africa, including the local franchises of KFC, Pizza Hut, Friday’s, Costa Coffee and other casual dining brands.
Luckin has more than 3,000 stores across China, and has been locked in a turbocharged expansion plan to unseat Starbucks as the No.1 coffee chain in the world’s second-largest economy—including a goal to surpass that 4,500-unit benchmark this year. Its strategy of lower prices, discounts, speedy delivery and promotions on social media have pushed Starbucks to form a delivery agreement with Chinese tech giant Alibaba. But the chain, which has yet to mark its second year in business, is operating deep in the red and has yet to turn a profit.