Luckin Coffee announces launch of Luckin Tea as independent brand
Luckin Coffee announced the launch of Luckin Tea as an independent brand and its brand ambassador Zhan XIAO, as well as a pilot program for its pioneering Retail Partnership model to recruit partners nationwide. The Company expects both Luckin Tea and Luckin Coffee stores to function in highly complementary roles. In terms of product category, Luckin Tea stores will also sell a standard range of classic freshly-brewed coffee, with a broader enriched assortment of freshly-brewed tea drinks. In addition, Luckin Tea stores will focus more on "leisurely" consumption moments, targeting locations in shopping malls and other lifestyle-centric commercial areas, while Luckin Coffee stores will continue to expand its presence primarily in office locations. Strategically, Luckin Tea stores will initially be rolled out in Tier 2 through Tier 4 cities, whereas Luckin Coffee will focus on Tier 1 and Tier 2 cities. Luckin Tea will consistently take Luckin Coffee's core value of "quality first", providing high quality, high convenience, and high affordability freshly-brewed tea drinks to consumers. Luckin Coffee also announced its pilot Retail Partnership model to support the expansion of Luckin Tea. Different from traditional franchise model, the Company's Retail Partnership model has multiple advantages for its partners, including attractive terms with no upfront partnership fees, reduced operational risk, the ability to leverage the Company's pervasive brand recognition, premium products and extensive supply chain, as well as access to the Company's disruptive technology-driven new retail model. Through the Company's innovative Retail Partnership model and digitalized operation platform, partners will not only be able to control their service quality effectively but also mitigate investment risk while increasing profitability at their stores.