Is T97 Coffee Franchise a Scam? The Brutal Reality of Physical Store Operations!

The Rapid Rise and Fall of T97 Coffee

According to posts from netizens yesterday, T97's first store on Yongkang Road in Shanghai is now closed—it didn't even last six months.

It isn't just the Shanghai flagship. Posters from other regions report that T97 arrived in a rush and left in a hurry. Judging by the posts, most T97 stores closed within three months of opening.

The Viral Sensation

Starting last June, T97's hype-style livestreaming and its oddly catchy rapper chanting "Coffee, rush, rush, rush" turned a livestream room that had peaked at 190,000 viewers into an overnight sensation. According to Sina Finance at the time, in the 30 days after going viral, T97 broadcast 34 times, with total viewership reaching 72.2754 million and peak viewership hitting 8.09 million.

Grand Promises vs. Reality

Riding that traffic, T97 founder Li Xiao boldly declared he would open 1,001 stores within a year, with defeating Luckin Coffee as the stated goal. In reality, by October last year there were only 48 offline stores, and by January this year the count still hadn't passed 100. Most lasted about two months.

Declining Interest

Even so, plenty of users are still asking how to franchise a T97 store, apparently still living in that "rush, rush, rush" golden era. But open T97's livestream room today, and the room that once drew millions of viewers now sits at a couple dozen.

Reasons for the Decline

Part of the gap: Dazui, the host who made T97 famous, rarely appears anymore, so there's no longer even a reason to drop by "for the spectacle." People simply tired of "rush, rush, rush." Another part: after netizens impulsively bought and redeemed vouchers out of curiosity, they had no desire to repurchase.

Many netizens note that quality varies wildly from store to store, and even drinkers without high standards find the coffee unpalatable. Unused vouchers get refunded at expiration, so there's little incentive to redeem them at all.

Franchise Issues

Right after going viral, Li Xiao rushed headlong into franchise expansion—an attitude that raised eyebrows even at the time. Many suspected the goal was to pocket franchise fees from investors rather than serve everyday customers.

Still, plenty of people cling to the dream of owning a coffee shop, saw that brief window of popularity, and signed up.

Once the agreements were signed, though, the brand largely abdicated its management responsibilities. Most franchisees knew little about coffee preparation or store operations, which dragged down the whole brand's reputation and consumer trust. In the end, many stores closed at a loss—high costs, thin margins, fading hype.

The Coffee Market Reality

One undisputed truth in this industry: without strong product quality, you won't easily steal business from competitors. Yet after going viral, T97's first priority wasn't developing standout products—it was relentless "brainwashing": "Franchise with us—it's the right choice! Look how popular we are, the franchise fee is only 20,000 a year, what a bargain!"

Look closer, though. Beyond the franchise fee you'd need roughly 140,000 for equipment, 20,000 for a security deposit, 20,000 for raw materials and utensils, another 20,000 deposit, 10,000 for operations, 10,000 for design, and 2,000 per square meter for renovation—among other miscellaneous costs.

Cautionary Advice

When opening a coffee shop costs nearly 300,000, be careful. And when the brand you're franchising hasn't yet found its footing, be extremely careful. Setting aside whether a franchisee can turn a profit at all, a brand that opens franchising before its foundation is solid deserves scrutiny on reputation alone.

The chain coffee shops that survive today share common traits: strong brand reputation, stable products, continuous innovation, and enough capital to sustain operations. T97 opened for franchising while lacking all of them.

Consumer Perspectives

Quoting one netizen's comment:

Brand reputation ultimately depends on ordinary consumers' support and recognition. Spending 300,000 on a franchised coffee shop is no better than building your own independent brand—the cost is lower, and you're never hostage to some parent brand's collapsing reputation.

Keys to Success

Running a successful coffee shop demands real professional competence. Management and quality control together determine whether customers stay. Only by earning recognition from more and more drinkers can you establish yourself in the coffee market.

If you open an independent shop, don't measure yourself against the chains—their business models are entirely different. Focus on your own work, keep your products stable, and invest in customer relationships; your loyal regulars will follow naturally.

Image source: Internet

FrontStreet Coffee Recommendation

Whether you're planning an independent café or just brewing at home, product quality starts with the beans. FrontStreet Coffee recommends these reliable, approachable options:

FrontStreet Coffee Brazil Cerrado Red Bourbon — a soft-bean classic from Brazil's Cerrado with gentle cream, peanut, and cocoa notes and excellent balance. Low acidity and forgiving to extract, it suits pour-over, espresso, and moka pot alike—a dependable base for any new shop's daily menu.

FrontStreet Coffee Ethiopia Yirgacheffe Guodingding (Washed) — jasmine florals, lemon brightness, and berry sweetness with a green-tea finish. The clean, approachable profile that wins first-time specialty drinkers over, perfect for pour-over programs aimed at building regulars.

FrontStreet Coffee Indonesia PWN Golden Mandheling — wet-hulled Sumatran coffee with a full, smooth body, herbal and dark chocolate notes, and virtually no acidity. A favorite for drinkers who prefer rich, mellow cups—and a useful option for espresso blends where body matters most.