Pocket-friendly coffee creates big buzz in smaller towns

A cafe at Diaoyuan ancient village in a town under Ji'an city in Jiangxi province.[Photo/Xinhua]

As China's county economies continue to thrive, more customers from lower-tier cities and towns are seeking affordable and high-quality coffee drinks.

In a small town of Huojia county in Central China's Henan province, a Lucky Cup cafe, with an average order price of 6 yuan ($0.83), draws a steady stream of customers.

"We use three rolls of receipt paper and 5 kilograms of coffee beans on average every day," says Wang Zechang, head of the cafe. In less than 10 months, the cafe has already generated nearly 800,000 yuan in turnover.

Wang has opened two cafes in the county, and plans to launch two more this year to meet rising demand.

Founded in 2017, Lucky Cup is dedicated to deliver high-quality yet affordable coffee, and is a coffee chain under beverage giant Mixue Bingcheng. The chain has since expanded to over 5,000 outlets nationwide, with 61.5 percent located in third-tier or smaller cities, according to its regional manager Ge Shihao.

As coffee consumption habits take root, first- and second-tier cities have seen a saturation of coffee shops. Now, the spotlight is shifting to smaller markets. "Third- and fourth-tier cities are the next 'blue ocean' for the coffee industry," says Shi Jun, secretary general of the coffee professional committee of the Shanghai Food Association.

International brands are also diving into these emerging markets, as one such brand reported in its fiscal first quarter of 2025 that it had entered over 1,000 county-level markets across the mainland.

Data from e-commerce platform Meituan show that in 2024, coffee delivery orders in county-level areas for established brands had surged by 97 percent, while the number of coffee shops soared by 159 percent.

According to food industry analyst Zhu Danpeng, residents in around half of China's counties and townships have already developed a basic "coffee consciousness". However, many still associate coffee drinking with upscale consumption, often assuming prices to be around 30 yuan per cup. "The emergence of affordable coffee options of good quality has successfully tapped into and activated latent demand," Zhu says.