Tim Hortons brings bottled coffee drinks to Alibaba’s Freshippo grocery shoppers in China
- The first products will be available on Freshippo’s app and more than 300 bricks-and-mortar stores across 27 Chinese cities starting December
- Tim Hortons, which entered China in 2019, faces competition from established player Starbucks and new entrants such as Lavazza and Blue Bottle Coffee
The Chinese arm of iconic Canadian coffee shop operator Tim Hortons has announced a new exclusive partnership with Alibaba Group Holding’s Freshippo supermarket chain to sell co-branded bottled drinks in the country.
The first products – “velvet cocoa coffee” and “chestnut latte” – will be available for purchase on Freshippo’s app and more than 300 bricks-and-mortar stores across 27 Chinese cities starting next month, according to Tims China’s statement on Friday.
Both parties will “work together on the research and development of the co-branded products, collaborating on product design, positioning, promotion and pricing”, the statement said.
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The partnership will “provide Tims’ excellent coffee products with the convenience of Freshippo’s multiple channels to reach millions of consumers across China”, said Yongchen Lu, CEO of Tims China, also known as TH International.
The size of China’s coffee market reached 381 billion yuan (US$53.5 billion) in 2021 and is set to increase 27.2 per cent annually to 1 trillion yuan by 2025, according to consultancy iiMedia.
Last month, Tims China opened its 500th coffee shop in the country in Dongguan city, southern Guangdong province. It has also launched theme stores in collaboration with Chinese Big Tech firms, including a Shenzhen outlet with Tencent Holdings’ video gaming unit and a comics pop-up store with video-streaming site Bilibili.
The coffee chain’s new partnership with Alibaba will allow it to leverage Freshippo’s vast reach. The supermarket chain, also known as Hema, currently has 3 million daily active users on its app, according to data from market researcher MoonFox.
Shares of Nasdaq-listed Tims China declined 10 per cent to close at US$3.4 on Friday. Shares of Alibaba, which owns the South China Morning Post, dropped more than 4.5 per cent to US$80.48 in New York on Friday, after gaining 2.2 per cent to close at HK$80 in Hong Kong.
