In the world of coffee, the label “Made in China” is increasingly becoming a mark of quality and innovation.
Once perceived as a mass producer of budget goods, China’s manufacturing sector has made significant strides in producing coffee equipment and tools which, not only rivals, but often surpasses Western brands in terms of cutting-edge technology and functionality.
These advancements are a testament to China’s commitment to technological development and its ability to quickly adapt to global trends. Examples are Chinese brands like BYD on EV sector; Huawei in smartphones (and now EV too!); and DJI in drones for professional photography.
As with many other industries in China, Chinese coffee industry is also creating a name for itself, creating equipment, machines and tools which are attractive (good quality, user-friendly and reasonable prices) to customers abroad.
Tapping into Chinese manufacturing experience, flexibility and affordable prices
For many companies in the West, disrupting a market with new equipment or tools for the coffee industry usually requires a high investment budget to make prototypes and mockups to try in the market, with later initial orders to distribute among different channels (offline and online) for entry market data on sales forecast.
For context, let’s take a look at the market of small appliances (including small coffee machines and other equipment/tools) globally.
According to Statista data, the global market size of small appliances grew at a CAGR of 4.46% from 2018 to 2022, and the global revenue of the small appliances segment of the household appliances market is expected to continue to grow between 2024 and 2028 and reach a new peak in 2028.
This sector alone in the coffee industry will keep growing, especially in non-orthodox coffee markets such as the Middle East, SEA, Africa and parts of Latin America. The opportunities for entering and disrupting those markets with unique coffee equipment are ripe for innovative companies.
But where to find facilities or manufacturers open to help small and medium companies/startups to create prototypes and initial orders without the need of a big budget?
In the last 10 years, Chinese manufacturers have managed to combine affordability with quality, making their products accessible to a wider audience. This democratisation of high-quality coffee equipment is opening new possibilities for such companies to bring new products to coffee lovers worldwide.
According to China’s General Administration of Customs data, in 2023, China’s export volume of coffee machines/equipment reached 95.5 million units, with a cumulative export value of 2.1 billion U.S. dollars, which includes drip coffee makers, filter coffee brewing equipment, steam pressure coffee makers, coffee grinders (manually and electrical) and other coffee makers (including coffee equipment to use outdoors).
Moreover, modern Chinese coffee equipment is now equipped with sophisticated features such as precise temperature control, automated brewing processes, and smart connectivity that allow users to craft their perfect cup of coffee with ease from their phones.
The seamless integration of these high-tech functionalities does not just enhance the coffee-making experience; it also reflects a broader trend of Chinese companies’ leadership in the global tech and innovative arena.
It’s not just about the equipment, though; the story of “Made in China” coffee equipment is also one of cultural transformation. As the Chinese population embraces coffee culture, local manufacturers are increasingly focusing on innovation to meet the sophisticated tastes and preferences of both domestic and international consumers.
This is where Western small and medium size companies/startups can rely on Chinese companies to bring into reality their ideas of new products/tools with reliable quality and lower costs than their Western counterparts.
Leveraging Chinese innovation capabilities to disrupt your market
For Western companies who want to stand firmly in their domestic or overseas markets, Chinese manufacturers offer not only to build, optimise and upgrade their products, but also to enable them to directly solve pain points of end-customers, to open new markets in a shorter period.
The democratization of coffee technology, brought by Chinese manufacturing capabilities, has shifted the landscape, making sophisticated equipment/tools once reserved for the big companies now affordable and accessible to produce for a wider global audience.
This shift isn’t just about the gear; it’s a transformation that empowers enthusiast entrepreneurs to craft the perfect equipment to brew a cup of joe with precision and passion.
The impact of this democratization extends beyond borders; it fosters a global community of coffee companies connected by a shared appreciation for the craft. As more people in non-orthodox coffee markets gain access to coffee brewing equipment/tools, the market evolves, leading to a more diverse array of options and price ranges.
Companies with unique innovation ideas in design and brewing technologies, featuring compact, user-friendly equipment, intuitive for any coffee drinker to use no matter their knowledge of coffee brewing techniques can leverage the capabilities of Chinese manufacturers to disrupt their existing and potential markets.
Enter & Grow into emerging “non-orthodox” coffee markets
The emergence of Chinese manufacturers offering cutting-edge coffee equipment/tools at significantly reduced prices is poised to reshape the global coffee equipment market.
This development is particularly transformative for small businesses and entrepreneurs who previously found it challenging to invest in high-quality coffee-making tools. By making advanced technology more accessible, these manufacturers are not just lowering the barrier to entry but also fostering a more inclusive environment for coffee lovers worldwide.
The impact of this shift is especially pronounced in the markets of the Global South. As these regions experience a burgeoning coffee culture, the availability of affordable coffee equipment and tools becomes a game-changer.
Local consumers, who are just beginning to explore the world of coffee, now have the opportunity to start their journey with good quality equipment without breaking the bank. This makes the coffee experience more accessible but also encourages the growth of Gen Z and Millennials local coffee cultures.
As the coffee culture in these markets matures, we can expect an interesting trend where consumers initially opt for budget-friendly equipment/tools to experiment and learn.
However, as their passion for coffee grows, they may start seeking out upscale equipment that boasts brand recognition and superior features.
This natural progression not only indicates a deepening appreciation for coffee but also suggests a market evolution where both affordable and high-end coffee equipment coexist, catering to a diverse range of consumers and their varying needs and preferences.
In this space, adventurous and innovative companies can enter such “non-orthodox” coffee markets and grow there with budget-friendly products made in China, while keeping high-end products manufacturing in Western countries with higher production costs and exceptional quality.
Innovative companies with a well-balanced product range for growing markets and matured markets will be the winners of the future markets.
The question, therefore, is: will your company be one of the winning players?
This article was researched and written by Felipe Cabrera, Founder & CEO of Ad Astra Coffee Consulting. Felipe is a valued network partner of inewtrition, providing services on a wide range of topics related to the Chinese coffee market and F&B industry.