Nayuki Tea Closes Largest Nationwide Store: Is It the End of Dream-Building or...

Nayuki's Dream Factory: From Largest Store to Lifestyle Concept

For ordinary office workers, a day wouldn't be complete without milk tea and desserts to get through a busy afternoon. Today's coffee and tea shops have recognized this demand, offering desserts alongside beverages to save customers from unnecessary indecision. Nayuki perfectly tapped into this need, standing out in the new-style tea beverage market with its tea drinks plus soft European bread combination. However, this prosperity didn't last long. After Nayuki became the first publicly listed company in the new-style tea beverage sector, negative news frequently emerged. Now, Nayuki's largest store nationwide—the Nayuki Dream Factory—has closed.

According to a May 20th report by Jiemian News, when a reporter visited the Nayuki Dream Factory store at Shenzhen Coastal City Shopping Center, they found the original site was surrounded by barricades. Signs inside the shopping center indicated that the original location of the Nayuki Dream Factory would be transformed into "Nayuki Life," a lifestyle concept store. Nayuki responded that the Coastal City Dream Factory store would be upgraded and renovated into "Nayuki Life," taking over the "super experimental field" function of the Dream Factory. At that time, "Nayuki Life" will offer services including baked goods and tea beverages, reading spaces, floral art, and light meals.

A staff member at Coastal City Shopping Center told reporters that Nayuki Dream Factory recently began renovations, which may take up to 2 months to complete.

The Rise and Transformation of Nayuki Dream Factory

Nayuki Dream Factory officially opened in November 2019. The store spanned 1,000 square meters and was initially Nayuki's largest global store. The shop featured 15 major sections including bakery, tea beverages, coffee, craft beer, Western cuisine, retail, and limited edition products, bringing consumers numerous unexpected new items. Rather than just a milk tea shop, Nayuki Dream Factory was more of a multi-scenario experience venue: including a bar, gift shop, and Western restaurant. Reportedly, the store achieved nearly one million yuan in revenue within just three days of opening.

The closure and upgrade of Nayuki's largest store into a lifestyle concept store on its original foundation may be related to Nayuki's business development in recent years. In June 2019, Nayuki entered the alcohol industry by opening "Nayuki Bar"; in September 2020, Nayuki expanded into the coffee sector by launching the new store format "Nayuki PRO"; in October 2021, it opened "Nayuki Bookstore" near the south gate of Tsinghua University; and in April 2022, as convenient, portable ready-to-drink products gained popularity, Nayuki invested 500 million to 1 billion yuan to acquire RTD (Ready To Drink) production lines.

Market Challenges and Strategic pivots

Today, tea beverage brands face severe homogenization, with intense competition within the new-style tea industry, even spreading to other sectors. As early as February this year, Nayuki's related company, Shenzhen Pindao Catering Management Co., Ltd., applied to register multiple "Nayuki Life" trademarks, with international classifications covering catering and accommodation, alcohol, clothing and footwear, and convenience foods.

As new-style tea beverages gain popularity nationwide and milk tea shops continue to proliferate, brands must develop innovative products and launch trending categories to survive in this fiercely competitive market. To stand out among numerous tea beverage brands, multi-format business development seems more advantageous for brands to carve out a differentiated path.

Image source: Internet

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