Briefing: Meituan to pair with Starbucks rival Luckin Coffee on delivery services

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Meituan to team up with China Starbucks challenger Luckin Coffee on delivery services – SCMP

What happened: Starbucks’ Chinese rival Luckin Coffee is rumored to partner with lifestyle giant Meituan Dianping for on-demand drink and food delivery. Sources say after the launch of the service, consumers can order Luckin Coffee’s products on Meituan’s delivery app in over 20 Chinese cities. Currently, Luckin Coffee supports in-store pick-ups and SF Express-backed delivery. All orders have to be made in Luckin Coffee’s app.

Why it’s important: The rumored tie-up is seen as a response to Starbucks’ delivery agreement with Alibaba-backed Ele.me. As one of China’s biggest food and drink delivery platforms, Meituan’s power, boosted by huge user traffic across China, will allow Luckin to reach more consumers with Meituan’s mature online and offline operations. The company’s mass-scale delivery forces will also optimize Luckin’s related costs. Luckin doubled its valuation to US$2 billion by raising a new round of financing of US$200 million last week.