Yum China, one of China’s largest restaurant companies, has unveiled its RGM 3.0 strategy and three-year financial outlook, which includes a huge boost in its partnership with Lavazza.
By the start of 2029, Yum China is targeting 1000 Lavazza coffee stores and US$60 million in retail sales after “five years of building its foundation”.
The two businesses initially partnered in 2020, which led to the opening of the first ever Lavazza store outside of Italy.
Yum China says this five-year foundation has set the Italian heritage brand’s store concept up to grow rapidly in the coming years.
“Lavazza has made meaningful progress, optimising store models, improving store economics and expanding both its coffee shop and retail businesses. Same-store sales grew double-digits in Q3 2025, and its latest Light Store Model shows healthy margins,” says Yum China.
“Leveraging its Italian heritage and coffee mastery, Lavazza blends authenticity with local innovation – from premium KAFA beans to buffalo milk latte and dessert-inspired drinks – tailored to Chinese tastes. Meanwhile, we are increasing local roasting capacity to support menu innovation and enriching food lineup to drive further growth.
“In retail, we continue to broaden both product ranges and distribution channels, spanning online to offline touchpoints. After five years of building its foundation, Lavazza is poised to accelerate growth.
“With significant runway in China’s fast‑growing coffee market, Lavazza targets 1,000 coffee shops and $60 million in retail sales by 2029, capturing substantial opportunities ahead.”
Yum China CEO Joey Wat says the company’s RGM strategy has been key to delivering significant growth over the past few years.
“Over the past 38 years, Yum China has maintained market leadership and consistently delivered solid growth amid dynamic market conditions. In recent years, guided by our RGM (“Resilience, Growth and Moat”) strategy, we have significantly transformed our operations, strengthened core competencies and built a strong foundation for future expansion,” he says.
“RGM 3.0 focused on all three aspects – resilience, growth and moat – powered by two complementary forces, innovation and operational efficiency.
“On the front end, we are innovating new modules and offerings to cater to a wide range of customer segments and occasions. On the back end, we are consolidating our resources to unlock synergies in and across stores, regions and even brands.”
Wat says Yum China’s desire to accelerate the growth of its Lavazza portfolio reflects a wider trend being seen by the business.
“Despite our significant scale, store expansion is accelerating. It took us 33 years to reach our first 10,000 stores, and we now aim to double that in just six years by 2026 and exceed 30,000 stores within the following four years by 2030,” he says.
“Our innovative and flexible store formats, together with a hybrid model of both equity stores and franchise stores, will enable deeper and faster market penetration.”
Back in 2021, Yum China and Lavazza announced their desire to open 1000 stores by 2025 with the injection of US$200 million into the joint venture.
Other globally recognisable brands within the Yum China portfolio include KFC and Pizza Hut.
