From Coffee to Fresh Beer: Gu Ming Wants to Sell More Than Just Milk Tea

Author: Xiang Qing; Editor: Zhao Yuan

Geming (Guming) looks less and less like a milk-tea shop.

On September 5, a beer machine appeared in a Geming store at Hangzhou’s Hubin Intime in77, beginning to test freshly tapped draft beer; on September 19, Geming opened its first nationwide “Fresh Enjoy” store in Nanjing, launching handmade Gelato. Over the prior year-plus, Geming had also been fitting coffee machines into stores at scale and bringing breakfast into operating hours.

Coffee, breakfast, ice cream, draft beer — four seemingly different businesses, yet placed in Geming’s latest financial report they point to the same question: now that a milk-tea brand has over 14,000 stores, what can drive its next growth?

As of end-June this year, Geming had 14,351 stores, with store GMV reaching 19.747 billion yuan, up 40.1% year-on-year. But net new stores in the same period were only 797, clearly lower than the 1,265 a year earlier — the net store-opening pace has visibly slowed.

Financial data also shows that in the first half, Geming’s revenue was 7.47 billion yuan (up 31.9% YoY) and attributable net profit 1.571 billion yuan (down 3.4% YoY). This was mainly affected by the fair-value change gain on convertible preferred shares in the same period last year; excluding that factor, Geming’s adjusted core profit rose 53.3% YoY.

Net store openings have clearly slowed, yet Geming’s revenue and adjusted core profit keep growing — signaling that the driver of its growth is shifting.

In past years, Geming solved how to replicate a 30-square-meter shop into 14,000-plus stores; past the ten-thousand-store mark, the new question before it is: as new stores get harder to open, how to sell more from existing stores, across more hours and more consumption scenarios?

I. Tea brands enter the post-ten-thousand-store era

Closure rate is one of the key data points for observing chain brands. When franchisees can’t make money they close; a tea brand’s scale can only be maintained by constantly recruiting new franchisees.

Over the past year, the new-style tea industry’s closure speed clearly accelerated. Per Zhaimen Canyan statistics, within the most recent year (mid-2025 to mid-2026), closures exceeded 110,000, with net store reduction widening to 43,200. On closure rate, the industry overall was 16.2% in 2025–2026 — roughly one in every six stores ceased operating.

Geming was a rare exception. In 2025, Geming franchise-store closures were about 4.8%, together with Mixue at the industry’s lower level.

More interestingly, 2025 was precisely the year Geming opened stores fastest. That year it opened 4,292 new stores, quickly surpassing 13,000. Low closure and fast opening appearing together, Geming was still expanding rapidly last year.

But past the ten-thousand-store mark, things began to change.

In the first half this year, Geming opened 1,318 new stores while closing 521, a net addition of 797. A year earlier, its net addition was 1,265. In other words, in one year Geming’s net new stores fell by nearly 40%.

For a tea brand that has entered the ten-thousand-store scale, the model of relying on franchise expansion is being tested.

When store count is low, opening a new store means covering more consumers and adding brand revenue and GMV; but once stores exceed ten thousand, finding suitable sites keeps getting harder, and new and old stores may overlap in customer base.

At this point, the meaning of store count itself begins to decline.

Geming’s management also began downplaying the “how many stores” metric this year. At the earnings call, the company said net store count is not a hard KPI that must be met; whether a store has operating value matters more than simply chasing quantity.

Once tea brands cross ten thousand stores, what’s truly worth watching is single-store operating data.

By GMV, in the first half Geming’s single-store average daily GMV was about 7,800 yuan (up ~2.6% YoY); average daily cups sold about 440, roughly flat with a year earlier. Meanwhile, total cup volume grew 35.9% to about 1.11 billion cups.

By contrast, other tea brands all showed varying declines. Also in the first half this year, Chagee’s Greater China same-store GMV fell 16.1% YoY in Q2; Nayuki’s average single-store daily sales dropped from 7,600 to 7,000 yuan; Mixue Group also disclosed that its main-brand average store turnover fell by double digits in the first half.

But stable single-store GMV does not mean stores face no pressure.

Over the past year, the industry went through fierce price competition and a delivery-subsidy war. Platform subsidies brought more orders, but delivery and promotion costs also rose, and franchisees’ actual take-home fell. In Q3 2025, delivery once accounted for 60% of Geming’s GMV, and franchisee net receipts dropped from above 75% pre-subsidy to about 70%. In the first half this year, Geming began adjusting its delivery pricing, raising minimum order and product prices, and net receipts recovered to about 78%. Per Haitong International estimates, that equals a 3–4 yuan increase per delivery order.

Headquarters operating efficiency also improved. In the first half, Geming’s revenue rose 31.9% YoY while sales and distribution expenses and administrative expenses rose 20.8% and 12.4% — both below revenue growth; gross margin also rose from 31.5% a year earlier to 33.4%.

Although attributable net profit fell 3.4% to 1.571 billion yuan, that figure was affected by last year’s one-time financial-liability fair-value change gain. Excluding it, adjusted profit rose 44.4% YoY and adjusted core profit rose 53.3%.

With the opening pace slowing, how to make the existing 14,000 stores sell more has become Geming’s more realistic growth question.

II. 14,000 milk-tea stores — what else can they sell?

While store scale still expanded rapidly, Geming’s single-store performance did not clearly decline; one important variable was coffee.

At the earnings call, Geming CFO Meng Hailing said that without coffee and the morning-daypart business, the company would have found it hard to sustain the first-half growth. By end-June, about 13,500 Geming stores had installed coffee machines, a coverage rate of about 94%.

Coffee’s significance for Geming is shifting from a new category into part of store operations.

Geming disclosed that outside promotions, coffee’s share of store sales has stabilized above 20%, exceeding 25% during campaigns. CICC’s research note estimates Geming coffee’s current cup-volume share at about 20%.

More importantly, coffee may bring Geming more than just new sales.

Tea’s consumption peak concentrates in the afternoon; coffee naturally corresponds to breakfast, commuting and morning consumption. By putting coffee machines in the vast majority of stores, Geming tries to use the otherwise relatively idle morning hours without significantly increasing store count.

Currently the tea industry’s coffee play has roughly two paths.

One is a standalone brand, like Mixue’s Luckin-like “Lucky Cup”, already with over 10,000 stores. The other is adding coffee products directly inside existing tea stores — both Nayuki and Geming belong to this model.

Behind the two paths are two different growth logics.

An independent brand must rebuild consumer recognition and a store network, but can have clearer category positioning; a main brand adding coffee directly can reuse existing stores, franchisees, supply chain and consumer traffic, and roll out the new category faster.

Notably, independent coffee-brand expansion has begun to slow.

Jihai data shows Lucky Cup now has about 7,900–8,000 stores, and since this year its new-store count has clearly slowed — only 14 new stores in August, versus 892 in August last year.

Meanwhile, this year Mixue also began putting coffee further into Mixue stores themselves. Per its 2026 interim report, by end-June Mixue had deployed coffee machines to about 6,000 stores and upgraded fresh-brew to freshly ground.

Seen this way, coffee need not exist as a brand-new brand, but can become an incremental category within the existing store network. Luckin extending into tea follows a similar logic.

In August 2024, Luckin launched “Light Oolong · Light Milk Tea,” then successively added fruit tea, matcha and more, proposing the “coffee in the morning, tea in the afternoon” scenario.

The light milk tea sold over 44 million cups in its first month. By 2025, Luckin launched 140-plus new products for the year, with non-coffee drink cup share exceeding 20%. By end-May 2026, Luckin’s cumulative non-coffee sales had surpassed 20 billion yuan.

Past ten thousand stores, tea and coffee brands both began seeking increments from each other’s business.

III. Can draft beer become the next growth point?

After coffee worked, Geming turned its eyes to a later daypart.

In September, Geming quietly launched two freshly tapped draft beers at a Hangzhou Hubin Intime in77 store, 500 ml at about 12–15 yuan. This is still a small-scale test; Geming has not announced further nationalization plans.

This time, Geming again did not build a standalone draft-beer brand like Mixue, but directly put a beer machine into existing milk-tea stores. Logically it’s little different from coffee: sell coffee by day, beer by night, covering more dayparts with the same store.

But beer may be harder to replicate than coffee.

Coffee has stable consumption ties to breakfast, commuting and afternoon work; beer leans more on evening socializing and dining-out scenarios. Consumers willing to buy a coffee at a milk-tea shop doesn’t mean they’ll also sit down for a beer there.

Tea brands have already paid trial-and-error costs for this.

In 2024, Sexy Tea launched “Day-Night Poetry Wine · Arts Bistro,” trying to enter nighttime tipsy consumption via “tea + wine.” Over two years later, the sub-brand announced it would fully close by October 31 this year. Sexy Tea’s own explanation: the business model was not validated, and dine-in drinks and the so-called “third tipsy space” did not form sustained, healthy cash flow.

Mixue Group is also trying to enter the beer track. In 2025, Mixue acquired a 53% stake in draft-beer brand Fulujia, bringing it into the group, but Fulujia keeps its independent brand and store network.

Different brands choose different paths. Some make wine a standalone space, some acquire mature draft-beer brands, while Geming chooses to put the new category directly into existing stores. For Geming with 14,000-plus stores, this is a relatively light trial-and-error approach — no need to rebuild a store network, and it can first observe whether consumers will pay for this new scenario.

Behind the crossover is the passing of the new-tea high-growth period.

Hongcan Industry Research Institute data shows new-tea market growth was 19.3% in 2023, falling to 8.2% in 2024 and further to 6.4% in 2025. Meanwhile, stores began shifting from expansion to contraction.

Top brands also began slowing expansion. In the first half of 2026, six listed tea companies’ combined revenue grew about 9% YoY and combined net profit was about 5.373 billion yuan, down over 2.7% YoY. Meanwhile, Geming, Chagee and others’ store-opening rhythms also clearly slowed.

As market growth slows and store counts come under pressure, the room to keep growing by opening stores naturally narrows. So from coffee and baking to alcohol, top tea brands are trying to push their business boundaries outward.

For Geming, coffee has already provided a sample: new categories can use existing stores and supply chain to open up dayparts not fully used before. But whether draft beer can replicate that logic still needs more time to verify.

Past ten thousand stores, Geming urgently needs to prove how much of the new business inside existing stores can truly convert into growth.

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