Vantage Point: Kopi Kenangan's recovery proves offline business holds key to profits

Photo: Kopi Kenangan website

This weekly newsletter highlights top developments and trends across Southeast Asia’s digital economy and ecosystem, without losing sight of the solid links between the online and offline worlds.

Executive Summary

Kopi Kenangan – Back in black
Akulaku – Eyeing diversified play
PropertyGuru – Growth on track

Kopi Kenangan – Back in black

Indonesian direct-to-consumer player Kopi Kenangan is back in the black after slipping into losses last year, underlining the fact that this is a startup that relies on its offline business to generate profits. While its app-based orders provide convenience for customers, it needs them to be mobile to really hit the home run. 

Kopi Kenangan slipped into losses last year at the operating level after remaining in the black for two years – 2019 and 2020 – again at the EBITDA level. The company has indicated that it would still take two more quarters before it would revert to 2019 levels. 

The company opened more stores in residential areas during the pandemic, which helped to offset the impact on business from mobility restrictions and remote working. The neighbourhood stores now account for 52% of its outlets.

Kopi Kenangan looks set to resume its expansion tack this year, with the aim of becoming the largest coffee chain in Indonesia. It is also looking to open in other SE Asian countries this year. 

The company’s more recent monthly revenue numbers have been higher than pre-pandemic. In May 2022, the revenues are likely to be three times higher than in May 2019. The company has forecast sales growth of 360% between 4Q2020 and 4Q2022, suggesting a huge ramp-up as the economy reopens in Indonesia. 

In 2021, Kopi Kenanagn was focused on building out its outlets with 566 stores across 46 cities by the end of the year from 226 stores in 2019. This is a lower number than its original guidance of 800 stores by end of 2022, which was impacted by the pandemic.

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