Orphaned at 10, Zhang Junjie spent seven years homeless, fighting to survive each day before finally learning to read and write at 18. His early years were filled with hardship, but he refused to let his past define his future. Now at 32 years old, he has cemented his place as one of the most influential figures in China’s tea industry. The self-made entrepreneur, who never attended college, started Chagee in 2017 and, in just a few years, transformed it into a powerhouse with over 4,500 stores worldwide.
A Humble Start and an Early Passion for Tea
Zhang’s entry into the world of tea was far from glamorous. Without academic credentials or powerful connections, he took on an entry-level job at a Taiwanese milk tea chain, where he performed basic tasks like preparing drinks and cleaning floors. But what set him apart was his ability to learn quickly. In just three years, he climbed the ranks from store employee to regional supervisor and eventually became a franchisee, demonstrating a remarkable ability to adapt and excel in the competitive tea industry.
However, his ambitions extended beyond just running a successful franchise. In June 2017, Zhang returned to his hometown of Kunming to establish Chagee, which rapidly achieved tremendous success in the mainland market. a province known for its rich tea culture. His goal was simple yet profound: to reinvent the traditional tea-drinking experience and make Chinese tea a global phenomenon.
The Birth of Chagee: A New Vision for Tea
From the start, Chagee distinguished itself by prioritizing high-quality ingredients, innovative brewing techniques, and a sleek, modern aesthetic. Unlike many competitors who focused on bubble tea, Zhang positioned tea itself as the star of the show. Chagee’s drinks are made from freshly picked tea leaves rather than powdered tea, and its signature jasmine green milk tea has become a best-seller, with 230 million cups sold in 2023 alone.
Chagee’s branding, with its elegant packaging often compared to luxury brands like Dior and LV, also played a significant role in its success. The brand’s emphasis on tradition, combined with modern convenience, attracted a growing base of young, health-conscious consumers.
“If young people are not drinking tea, then there will be no future for tea,” Zhang said, emphasizing the importance of making tea appealing to millennials and Gen Z consumers.
From a Single Store to a Global Empire
Chagee’s growth has been nothing short of spectacular. In 2022, the brand underwent a major transformation by rebranding from BaWangChaji to CHAGEE, marking a new chapter in its journey. This rebranding aimed to elevate the consumer experience with a modernized tea house atmosphere, reinforcing CHAGEE’s position as a premium tea brand. From its humble beginnings in Yunnan, it expanded rapidly across China and then internationally. Today, Malaysia and Singapore serve as key markets outside China, with over 100 stores in Malaysia alone. The rebranding was marked by the grand opening of CHAGEE’s flagship store in Pavilion Kuala Lumpur, an event attended by high-profile figures including badminton legend YBhg. Datuk Wira Dr. Lee Chong Wei, and famous actress and singer, Hannah Delisha.
One of Zhang’s most strategic decisions was implementing a franchise model that allowed for controlled expansion. Unlike other brands that rush into new markets without a solid foundation, Chagee first establishes fully-owned subsidiaries in target countries to ensure product viability before allowing franchisees to take over. This approach has ensured consistent quality and brand integrity, making Chagee a formidable competitor in the international tea market.
Innovation and Technology at the Core
Chagee’s success is not just about branding and expansion, it’s also about efficiency. The company has embraced automation to maintain product consistency, with its fully automated production process reducing variance in drink quality to just 0.2%. Its tea-making equipment can prepare an order in just eight seconds, enabling stores to serve thousands of customers daily without compromising on quality.
Beyond operations, Chagee has also introduced initiatives such as nutritional labeling, calorie calculators, and the elimination of non-dairy creamers to align with the growing demand for transparency and healthier options. In early 2024, Chagee introduced a Nutritional Choice label at its Shanghai locations, becoming the first tea brand to implement a nutritional grading system to help consumers manage sugar intake.
Additionally, the company launched a Product ID Card and a Health Calculator to provide full transparency on nutritional values. These initiatives, combined with the removal of artificial flavorings and trans fats from its drinks, reinforce Chagee’s commitment to providing healthier alternatives in the ready-to-drink tea industry.
To ensure scalability and quality, Chagee has implemented a ‘1+1+9+N’ operational model. This system consists of a central headquarters, a dedicated local team, nine directly managed stores, and an unlimited number of franchised stores. By first launching flagship stores in new markets, Chagee can establish brand presence and fine-tune its operations before expanding the franchise network.
The Future: A Global Tea Powerhouse
Chagee has set ambitious goals, aiming to reach 100 countries and serve 15 billion cups of tea annually. In 2023, CHAGEE’s total sales reached 10.8 billion RMB (~RM6.5 billion), and in the first quarter of 2024, CHAGEE’s sales were 5.8 billion RMB (~RM3.5 billion). By the end of 2024, the company’s total sales were projected to exceed 20 billion RMB (~RM12 billion), further solidifying its dominance in the global tea market.
Despite his financial success, Zhang leads a modest lifestyle, reportedly owning no real estate or car and having minimal material needs. Looking ahead, Zhang has ambitious plans for the brand. Chagee is reportedly gearing up for IPO, a strategic move that could generate $300 million in capital to accelerate its global expansion and strengthen its market presence. Zhang has even hinted at surpassing Starbucks in China, a bold claim that underscores his confidence in the brand’s potential.
“The push for the globalisation and modernisation of tea is not something Chagee can accomplish alone. It requires a joint effort from industry partners, competitors, government agencies, and consumers alike,” Zhang states. With Zhang’s visionary leadership, Chagee is not just expanding but redefining the global tea industry, merging tradition with innovation.
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