Malaysia’s coffee chain overdose, explained

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Hello reader,

Fun fact: I don’t drink coffee.

This is a piece of information that often gets me surprised looks and horrified reactions from people. How do I survive without caffeine? What gets me going in the mornings? Where do I get my energy from? Am I human?

I’m fueled by sugar and willpower – through the magic of Milo, Coca-Cola, and bubble tea, I’ve gotten this far.

However, I’m more the exception than the rule. Lots of folks love coffee and consume it daily – sometimes multiple times a day – and that means competition is heating up among brands that cater to these coffee drinkers.

This is especially so in Malaysia – it’s not Southeast Asia’s biggest coffee market, but it’s certainly proven to be pretty exciting.

Today we look at:

• How the Malaysian coffee scene is heating up
• Gojek Vietnam’s latest partnership with a local EV firm
• Other newsy highlights such as Kopi Kenangan’s expansion into Malaysia (a lot of coffee in today’s newsletter) and the departure of two top executives from Oyo

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Caffeine overdose

Image credit: Timmy Loen

Statista data showed that last year, the people of Malaysia consumed 800,000 bags of coffee – each weighing 60 kilograms. While the country is an exciting market for coffee companies both local and international, there’s not enough space for everyone.

• Spoiled for choice: There’s no lack of options for fans of this beverage: Think traditional Chinese coffee shops, hipster cafes and specialty coffee houses, international chains such as Starbucks and The Coffee Bean & Tea Leaf, local tech-enabled startups (e.g., ZUS Coffee, Gigi Coffee, and HWC), foreign firms along the likes of Kopi Kenangan, and more.
• Fighting over the same pie: The lines separating these companies are blurring. For example, Starbucks initially catered to the upper-middle class, but it’s moving into the middle and lower-middle income space, with prices on par with those from ZUS, Gigi, and others. Starbucks is also expanding outside of Kuala Lumpur into areas that have previously been the domain of local chains.
• Heating up: Malaysia also presents challenges in terms of higher import costs brought about by a weaker ringgit and inflation. Plus, Chinese brands such as Luckin’ Coffee and Cotti loom, and they could change up the landscape.

Read more: Malaysia’s coffee scene heats up as foreign players take on local firms

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