STiR coffee and tea magazine

14 STiR coffee and tea | 2023 Issue 5 (October / November) Yum China Gets Bigger in Coffee Coffee is coming on strong at Yum China, the nation's largest restaurant company, which has some 13,000 venues under brands like KFC, Pizza Hut, and Taco Bell. Yum's joint venture with Lavazza has established 100 coffee shops in 11 cities since 2019, with plans to expand to 1,000 venues within three to five years. At the same time, Lavazza is giving Pizza Hut's coffee menu a specialty upgrade. It's also supply- ing beans and capsules to premium hotels and restaurants in China. Yum's largest coffee channel is KFC, with nearly 10,000 stores across 1,900 cities. Sales of its in-house K-Coffee brand grew 50% year-on-year in the second quarter of 2023, with 47 million cups served. Cups are selling through new channels like take-away windows at KFC restaurants, K-Coffee kiosks, and K-Coffee trucks. "The coffee truck investment is low. It's lovely. It's so cute in any tourist location or anywhere without a fixed location," Joey Wat, CEO, Yum Holdings, told investors in August. "We only have about 200 right now, but you bet we're going to have more. And then during the holidays and festivals, there are popup stores." KFC leverages its existing soda fountain machines to vend coffee drinks like an "Iced Sparkling Americano with Zesty Lemon," or Bao Zhi San Ning Qi Pao Mei Shi. Given KFC's huge footprint, its coffee brand puts pressure on the McCafé brand owned by McDonald's, which has more than 3,000 venues, as well as on Luckin Coffee, the giant domestic chain. K-Coffee also competes with the 6,500 coffeeshops operated in China by Starbucks. K-Coffee single-origin specialty espressos sell for about 9 yuan ($1.30), about one-third the price of an equivalent Starbucks coffee. KFC plans to add 1,200 new locations in the next three years, the better to penetrate the 1,100 cities where it has no stores. Almost all these cities are in the third- and fourth-tier leagues. First- and second-tier cities in China are nearly saturated with coffee shops and kiosks. Yum China Holdings, which is listed on stock exchanges in New York and Hong Kong, is lifting dividends, buying back shares, and investing up to $1 billion a year in expansion. Same-store sales have rebounded to nearly 90% of the 2019 level. Yum's huge KFC chain offers coffee drinks and specialty espresso through its K-Coffee brand. Total revenue of $2.65 billion in the second quarter of 2023 set a new record for the quarter. The company has six restaurant brands, with some 13,000 locations and 400,000 employees. New Poster Charts Coffee Varieties A focus on coffee varieties is helping the industry improve quality and sustainability, and World Coffee Research has been leading the way with resources like its online catalog of arabica and robusta varieties. Now the group has published a colorful graphic that displays the names and genetic relationships of the more than 100 varieties in that database so that users can explore them at a glance. As seen on the cover of this issue of STiR, the striking visualization is part of a poster that can be downloaded free from the WCR website, printed, and shared. The poster was developed by webDNA, a U.K. design agency, to accompany the re-design and re-launch of the World Coffee Research Coffee Varieties Catalog earlier this year. The visualization is similar to the well-known Coffee Taster's Flavor Wheel, which was created using WCR's pioneering Sensory Lexicon and later co-released in a printable format in collaboration with the Specialty Coffee Association. Founded in 2012, World Coffee Research is a non-profit organization in the U.S. that promotes agricultural innovation to advance coffee quality, sustainability, and farmers' liveli- hoods. It has some 170 member companies across 29 coun- tries. Visit https://worldcoffeeresearch.org World Coffee Research poster is free to download and print. Coffee Report

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