Based on a comprehensive study by Momentum Works, outlined in the report "Coffee in Southeast Asia", Southeast Asia currently spends approximately US$3.4 billion annually on modern coffee consumption. The report provides a comprehensive analysis of the dynamics of the region's retail beverage market, with a focus on coffee.
The popularity of coffee in Southeast Asia is unsurprising. As one of the world's largest coffee-producing regions, there is an abundance of high-quality coffee beans. Supported by the proliferation of cafés and coffee shops throughout the region, coffee has become increasingly accessible and affordable, fueling the growth of a wide consumer base.
For many Southeast Asians, a cup of coffee has become an integral part of daily routines. Whether as a source of energy, a remedy for drowsiness, or a means of relaxation, coffee has captured the hearts of millions in the region.
Southeast Asia's Modern Coffee Market Powerhouses
According to Momentum Works’ study, Indonesia and Thailand dominate as the largest modern coffee markets in the region. Indonesia leads with an annual revenue of US$947 million, marked by intense competition among various local and international brands. Thailand follows closely, with an annual revenue of US$807 million.
Vietnam, the Philippines, Malaysia, and Singapore contribute US$572 million, US$445 million, US$364 million, and US$284 million, respectively, each with distinct market characteristics and leading brands.
Leading Modern Coffee Brand in Southeast Asia
Café Amazon leads as the top modern coffee brand in Southeast Asia in 2023, with more than 3,900 outlets. Starbucks and Dunkin take the second and third spots, with over 2,000 and 1,300 outlets across the region.
The Future of Modern Coffee Consumption in the Region
While Southeast Asia’s coffee shop market is booming, consumer spending remains relatively low. Euromonitor data shows that per capita coffee spending in Southeast Asia in 2023 was just US$7.3, significantly lower than the global average of US$14. However, there is substantial growth potential, with projected consumption increases of 7% per year through 2028.
Competition among brands is expected to intensify, with only the strongest players likely to survive. To stay ahead, coffee chains will need to invest heavily in expansion, despite the challenge of high global interest rates. Additionally, product innovation and diversification of distribution channels will be key to attracting and retaining consumers.
