Coffee War: A dark battle about price, taste and survival.

In an inconspicuous corner of Houtan, Pudong, Shanghai, two coffee shops—Starbucks and Luckin, are only 100 meters apart,Silently confronted.

They represent two models and two cultures, and can even be said to be two completely different consumer philosophies.

An on-site investigation that lasted ten hours revealed some surprising truths in this "".

Triple sales, but tied? The competition of unit price

The survey selected an ordinary Tuesday, which started from 7 a.m. to end at 5:30 p.m., and recorded the consumption data of the two stores in three shifts.

The results were surprising:Luckin sold 466 drinks, while Starbucks only 142 cups. Luckin's sales are nearly three times that of Starbucks.

However, when calculating a single-day revenue, the gap was quickly flattened - Starbucks' average daily revenue was about 4,971 yuan, while Luckin's was 5,872 yuan. The reason is very direct: Starbucks' average customer price is as high as 33 yuan, while Luckin Coffee is only 12 yuan.

In other words, although Luckin defeated its competitors in sales with its explosive order mode, Starbucks maintained its basic revenue market with its high pricing. To a certain extent, this seems to be a classic showdown between "quantity" and "price".

But the story goes far more than that.

The surveyors also noticed an interesting phenomenon:Starbucks' consumption curve has obvious peaks and troughsThere is a busy afternoon and a quick deserted afternoon. Only 6 cups were sold in an hour before closing;

Which Luckin's sales throughout the day were more evenly distributed, there were still orders in the afternoon, many of which were not even coffee—but milk tea drinks.

Behind this is actually the fundamental difference in product strategies of the two brands: Starbucks still focuses on "functional coffee", while Luckin has long transformed into a "caffeine beverage company", compatible with coffee and tea drinks, covering a wider range of consumption scenarios and customer needs.

Who makes more money? The truth hidden in the cost

Although revenue is close, the gap in profitability is very obvious.

By building a single-store financial model, the research team estimated key cost items such as rent, manpower, raw materials, and depreciation. The result is: Luckin's store's net profit margin is as high as 20%, while Starbucks barely breaks even and even loses a little.

Where does Starbucks lose? ——High cost.

Its store area is 120 square meters, located in a high-quality intersection location, with a monthly rent of about 40,000 yuan (and possible commercial discounts have not been calculated yet); the renovation investment is about 1.2 million yuan, and the monthly depreciation is not low.

In contrast, Luckin has an area of ​​only 70 square meters, a slightly off-site location, a monthly rent of 16,000, and a decoration cost of 600,000, and its manpower configuration is equivalent to Starbucks.

In other words, Starbucks has supported a mismatched sales scale with higher costs, while Luckin has achieved a better unit economy with its "small store model" and high turnover strategy.

But does this mean that Starbucks China has become a "non-performing asset"?

Not necessarily. There are two points worth noting:

The mystery of valuation: Why are Starbucks stores "more expensive"?

Even though Starbucks stores have a profitability that is inferior to Luckin, the former's single store valuation is as high as US$770,000, nearly twice that of Luckin (US$405,000). This is not a misjudgment of capital, but another set of logic behind it.

First of all, Luckin is currently trading in the US stock market with poor liquidity and imperfect pricing mechanism, and its actual value may be underestimated. If it returns to A-shares or lists in Hong Kong stocks, its market value is likely to rise.

The more important reason is:Capitals focus on Starbucks China's future "transformation space".

Stately, Starbucks' product structure is still relatively traditional coffee, with high prices, slow new products and low localization. If Luckin-style popular product strategies can be introduced - such as raw coconut latte and orange C American-style "coffee milk tea-based" products, and the price is reduced by 30%, it is entirely possible to activate sales.

In addition, Starbucks' brand influence still has absolute advantages in third- and fourth-tier cities, and many consumers still regard it as a "check-in holy place". This brand premium is unlikely to surpass Luckin in the short term.

In other words, the acquisition of Starbucks China is actually a bet for "Lucky Cinques transformation": capital is trying to release its suppressed profitability by changing products, reducing prices, and lightly operating, and then listing in packages to earn dual profits of operations and capital.

Starbucks and Luckin seem to be in a confrontation, but in fact they are also learning from each other.

Luckin has long been no longer satisfied with building an "online coffee shop", and has begun to try to open a flagship store with a larger space and better experience, moving closer to the "third space". And Starbucks has finally launched the "morning coffee and afternoon non-coffee" strategy in China, trying to expand the tea beverage market.

But anyway, the main theme of the Chinese coffee market has been rewritten. It is no longer an experiential consumption dominated by culture and space, but a game of efficiency around price, speed and taste.

Luckin, Kudi and Lucky Casinos at 9.9 yuan are cultivating the habits of the new generation of consumers at low prices. And when Starbucks finally put down his figure and turned around to fight, perhaps you will find that the strongest opponent is actually the era it once ignored.