China's New Coffee Could Replace Starbucks Forever — Here's How

A grande latte at Starbucks costs $6.45. The beans cost 12 cents. The milk costs 10 cents. The cup and lid cost 5 cents. Total ingredient cost roughly 25 cents. Howard Schultz grew up in the housing projects of Brooklyn watched his father break his ankle with no health insurance and built a $36 billion empire by selling the idea of a third place between home and work. He was rejected by 217 investors before raising $1.6 million to start his first coffee bar and bought Starbucks in 1987 for $3.8 million. Today Starbucks operates over 38000 stores in 86 countries and sells 8 million cups per day. Then Luckin Coffee launched in Beijing in 2017 committed $310 million in accounting fraud got delisted from Nasdaq nearly died and came back to overtake Starbucks in China with 35000 stores and $7 billion in revenue selling coffee at $1.40 per cup. The raw materials cost the same for both companies. The difference is rent and brand. Meanwhile Yunnan Province produces 98% of China's coffee with arabica beans now winning international competitions and scoring above 90 on the SCA scale. In this video we break down what your coffee actually costs why you pay 25 times more than the ingredients and how a company that faked its numbers came back and beat the most iconic coffee brand in the world.