Crisis in a cup: Manner Coffee faces PR debacle following incidents of employee violence

Last week China's Manner Coffee, a popular chain known for its rapid expansion and innovative marketing, announced a new partnership with Porsche. The collaboration featured a unique offering: The 'iced grape tonic Americano' inspired by the 2024 Porsche Macan 4 Electric in Provence lavender. This launch was poised to create significant buzz on social media and strengthen Manner Coffee's market presence.

However, the campaign was quickly overshadowed by a series of violent incidents at several franchise locations in Shanghai. Surveillance footage from last Monday revealed troubling scenes at three different stores. In one incident, a male barista was seen stepping away from his counter to slap a customer, while a female barista threw a can of ground coffee at another customer's face. Another altercation escalated about a month ago when a customer entered the barista's work area, leading to a physical scuffle. It was reported the incidents occurred as a result of extreme working conditions, which pushed the staff to the edge in tandem with "impatient" customers.

Surveillance video screenshots

Following the incidents, Manner Coffee issued an apology through its official Weibo account, expressing regret and outlining steps to improve employee training and store management—with a view to enhance service quality and reduce wait times and prevent such incidents in the future.
 

Despite these assurances from Manner Coffee, the recent confrontations have ignited a vigorous online debate about the alleged toxic work environment fostered by the company's aggressive expansion strategy. Critics argue that cost-cutting measures and stringent management practices have placed undue stress on employees, leading to dissatisfaction and unrest.

This debate gains further context when considering the pricing strategy at Manner Coffee. An Americano is priced at RMB 15 (approximately US$2.1), meaning a barista would need to work about 15 hours to generate a daily turnover of RMB 4,500 (around US$621), which entails preparing at least 300 cups of coffee in a single shift. Each cup takes about three minutes to prepare, demanding continuous labour without breaks.

However, actual sales figures reveal a different story. On average, a Manner Coffee store achieves a daily turnover of RMB 8,000 (US$1,102). Some baristas are even reported to prepare up to 500 cups of coffee during an eight-hour shift. Financially, a barista working in a top-tier city like Shanghai typically earns around RMB 5,000 (US$689) per month.

Manner Coffee's growth has been significant since its inception in Shanghai in 2015. Between 2018 and 2021, the brand secured capital investments from leading institutions including Temasek, Coatue, Meituan Longzhu, and ByteDance, fueling rapid expansion. By March 2022, the company had over 200 stores across 10 cities, and by October 2023, it celebrated the opening of its 1000th store in mainland China.

As of December 31, 2023, Manner Coffee reported having more than 1,200 directly-managed outlets throughout China, with an ambitious target to exceed 2,000 stores by the end of this year. The founders, who have helmed the company since its beginning, have accumulated a net worth of RMB 7.2 billion (approximately US$ 1 billion).

In the fiercely competitive Chinese coffee market, where rivals like Luckin Coffee and Cotti Coffee engage in intense price wars, Manner Coffee remains committed to enhancing profitability through strategic cost management. The company maintains a strong emphasis on the quality of raw materials, particularly high-quality coffee beans, supported by an efficient supply chain that balances cost-effectiveness with quality.

Despite industry trends leaning towards automation, Manner Coffee continues to use semi-automatic espresso machines to uphold its boutique standard. This method results in an average preparation time of about six minutes per cup, slower than the industry standard, which affects both store turnover and customer experience. This meticulous approach ensures service quality but highlights the challenges of balancing efficiency with the artisanal values central to Manner Coffee's brand identity.