The McDonald’s-owned café concept is targeting China’s affluent younger consumers and plans to reach 3,500 outlets in the country by the end of next year
The McCafé brand has grown rapidly in China in the last two years, reaching nearly 2,500 locations | Photo credit: McDonald's China
McCafé is seeking to launch 1,000 new locations in China by the end of 2023, with the McDonald’s owned café concept targeting third-tier cities for expansion.
In November 2020 McDonald’s China announced it would invest 2.5bn yuan ($381m) to expand its McCafé concept across more than 4,000 locations in the country.
The investment targeted expansion in key Chinese territories, including Beijing, Shanghai, Guangzhou and Shenzhen. The latest announcement states that growth will now focus on third-tier cities, considered to be commercially less developed than first and second-tier locations.
McCafé operates both standalone stores and locations within McDonald’s restaurants in China.
Traditionally a tea-drinking nation, the move demonstrates both the increasing commercial potential of coffee in China and a growing demographic of affluent younger consumers.
McDonald’s China CEO Zhang Jiayin said that the McCafé brand has grown rapidly in the last two years, reaching nearly 2,500 stores.
The Chinese branded coffee shop market is the second largest in terms of outlets in East Asia, behind South Korea. World Coffee Portal forecast the total Chinese market to exceed 36,000 outlets by 2025.
If McCafé reaches 3,500 outlets in China by the end of 2023 the company will cement its position as one of the country’s leading chains in terms of locations. The market is led by domestic coffee chain Luckin Coffee, which operates 6,600 stores in the country, and Seattle-based coffee chain Starbucks, which currently operates 5,400 outlets.