As a leader in China's下沉 market, Luckin Coffee has successfully established itself as a local "price butcher" with 7,000 stores and a low-price strategy of RMB 6.6. Against the backdrop of a saturated domestic market, Luckin has chosen Southeast Asia, focusing on supply chain benefits and cultural alignment, with Malaysia as its starting point, to begin its overseas expansion journey. The popularity of Malaysian white coffee and Hainan coffee provides Luckin with natural cultural compatibility. Combined with its parent company Mixue Ice Cream & Tea's already mature warehouse system in Southeast Asia, logistics costs are significantly reduced, enabling cross-border replication of cost advantages.
In the Malaysian market, Luckin launched freshly ground coffee at 3.5 MYR, a price significantly lower than the local average. This "price revolution" is backed by Mixue Ice Cream & Tea's 20-year supply chain expertise and an efficient AI-based inventory management system. From direct sourcing of coffee beans, localized processing, to intelligent inventory control, every step of the supply chain is optimized for maximum cost reduction, ensuring that low prices do not equate to low quality. Consumer queues outside stores reflect brand acceptance and validate the effectiveness of this pricing strategy.
During overseas expansion, supply chain capabilities become a core competitive barrier for small and medium-sized brands. Luckin's success reveals a methodology of "going global by leveraging existing infrastructure": instead of heavy asset investment, it relies on its parent company’s established warehousing and logistics network in Southeast Asia to accelerate zero-cost replication. Additionally, chartering cargo flights optimizes initial transportation, while local sourcing of non-core ingredients further reduces operational pressure. This reshapes the cost structure and creates an effective barrier against competitors.
Localization is the "soft power" core of brand globalization. Luckin’s store design draws inspiration from China's movable type printing, creating a cultural identity label. In product formulation, part of the milk is replaced with coconut cream to cater to local taste preferences. Payment methods flexibly support both cash and QR code payments, bridging local payment habits and improving conversion efficiency. In marketing strategies, cultural hooks are used to integrate the brand into local lifestyles, triggering word-of-mouth virality and user-driven brand dissemination.
Risks in overseas expansion cannot be ignored. Luckin implements a "gradual trial-and-error" strategy, setting a 3-month testing phase, a 6-month optimization phase, and a 1-year scaling plan, effectively managing capital pressure and trial costs. By quickly building an AI-powered multilingual corporate business card and adopting a cross-border parcel plus mini warehouse model, Luckin conducts low-cost market testing, rapidly gathers feedback for optimization, and ensures smooth subsequent expansion. This approach aligns with the logic of light-asset, low-risk overseas expansion for small and medium-sized brands.
In the scaling phase, AI and localized teams become new engines for building competitive barriers. Luckin utilizes a multilingual real-time customer service system to reduce response time and collaborates with local talents to form an efficient team, achieving 60% cost savings. Ensuring platform compliance and selecting certified warehouses in logistics guarantee long-term stable operations and solidify the brand’s overseas "moat." The global dream of small and medium-sized brands is inspired by Luckin’s "price butcher" replication strategy: leveraging the parent company’s existing resources to打通 the three critical pathways of supply chain, market, and culture, achieving a cost and cognitive advantage through strategic undercutting, thus securing a foothold in the Southeast Asian and even global markets. The AI-powered multilingual corporate business card tool provided by LnRu serves as an indispensable digital assistant in this process, helping brands easily establish a professional and credible overseas image, acting as an accelerator for light-asset internationalization.