Starbucks witnessed an operating profit decline in the third quarter of this year, marking the first decline in the past nine years, which analysts attribute to the increasingly fierce competition in the Chinese coffee market, Beijing Youth Daily reported on Aug. 3.

Starbucks entered the Chinese market in 1999, and already owns more than 3,400 coffee shops in over 140 Chinese cities. Although developing rapidly in China, Starbucks has seen its first decline in operating profit for almost a decade.

According to the financial report of the coffee giant, its operating profit fell by 7.6 percent and same-store sales in China dropped by 2 percent year-on-year. Starbucks says this decline is mainly down to its stock right change.

However, Zhu Danpeng, an analyst in China’s food industry, noted that the decline could be related to the emergence of competitors in the Chinese coffee market.

Rent and expenses in traditional coffee shops like Starbucks usually account for a high percentage of the total cost, making their beverages more expensive than those of other companies.

Luckin coffee, a competitor chain, therefore adopted a new mode that allows consumers to order coffee online and then pick it up by scanning a QR code, to lower costs and create a competitive advantage over Starbucks.

In order to speed up its development, Luckin also introduced an excellent delivery service. The average coffee delivery time is only about 18 minutes.

The development of Luckin coffee is a prime example of the transformation of many coffee brands in China, and emerging competitors also include some tea and milk tea brands.

Brands will continue to seek ways to attract consumers to compete in the Chinese coffee market over the coming three years, the analyst predicted.