Core Viewpoint - Peet's Coffee, a well-known global coffee chain, has closed its first store in South China, located in Shenzhen, due to the expiration of its lease, reflecting a strategic adjustment in its operations amid a competitive market [1][4][6]. Company Summary - Peet's Coffee opened its first store in South China in September 2021 and has operated for nearly four years before closing [4]. - The company has been closing several stores in China, including locations in Guangzhou, Hangzhou, and Beijing, primarily due to lease expirations [4][6]. - Peet's Coffee has approximately 270 stores across 20 provinces and 35 core cities in China, with plans to continue expanding its store count in the second half of the year [4][6]. - The parent company, JDE Peet's, reported a strong organic sales growth of 23.8% for Peet's Coffee in China, contributing to a global sales increase of 7.9% to €8.837 billion [4]. Industry Summary - The coffee market in China is experiencing intense competition, with various brands engaging in price wars, leading to a dilution of the premium coffee image [7][9]. - Analysts suggest that the restaurant industry is entering a phase of consolidation, where companies are closing underperforming stores while opening new ones in more strategic locations [7]. - Peet's Coffee is adapting to market changes by testing a more affordable product line with its Ora Coffee brand, offering products priced between 15 to 25 yuan, and implementing a "small and refined" store model to enhance operational efficiency [9].