On May 12, Luckin Coffee (NASDAQ: LK) announced that Guo Jinyi, previously director and senior vice president of Luckin, will take over as the new acting CEO of the firm, following the termination of former CEO Jenny Qian Zhiya and COO Liu Jian.
According to a filing with the US Securities and Exchange Commission (SEC), Luckin’s board demanded and received resignations from both Qian and Liu, as the probe surrounding Luckin’s USD 310 million revenue inflation deepens and investors lose confidence.
Brought in to steady the firm in a time of crisis, Guo Jinyi’s background is mainly in transportation, as he received his Ph.D. from Beijing Jiaotong University in transportation and planning management. Prior to joining Luckin Coffee in October 2017, Guo served as the assistant to the chairman for auto rental firm CAR Inc (HK: 0669), where he first met former Luckin CEO Qian Zhiya, who was serving as vice president of the transportation company.
Guo also worked at China’s Ministry of Transport from 2011 to 2016, and as a research assistant at the China Academy of Transportation Sciences from 2009 to 2011. In 2008, Guo spent some time as a visiting scholar at the Leeds University Institute for Transport Studies in the United Kingdom.
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Born in Inner Mongolia in 1981, Guo is one of Luckin Coffee’s co-founders. Given his academic and government background, he was largely involved with the logistics and distribution of Luckin’s vast delivery network. Guo once described Luckin’s use of big data and automation combined with IoT to ensure the consistency of product quality and service operation across Luckin’s store network.
The Luckin Vision of Guo Jinyi
Before ascending to his new role as acting CEO, public information shows that Guo was a key figure in marketing Luckin Coffee as a rival and challenger to Starbucks, while also promoting the firm’s tea business Luckin Tea.
Tea and coffee are “not contradictory to each other,” but are in fact complementary in workplace environments, he once said, according to a KrASIA report.
Guo has not been exempted from controversy. InMay 2018, he openly stated that Starbucks’ actions of preventing its suppliers from serving Luckin have affected the company’s operations and competition, according to China Daily.
Starbucks responded saying that it “welcomes orderly competition, mutual promotion, and continuous innovation,” adding that it has“no intention of participating in the promotion hype of other brands.”
Guo also commented on Starbucks’ cooperation agreement, cemented in August 2018, with Alibaba on areas covering delivery and virtual stores,hinting the deal would not be able transform Starbucks into a “new retail” company,according to Technode.
Despite the difficult situation Luckin finds itself in, Guo Jinyi will be tasked with getting the firm back on its feet, as the country’s network of over 6,900 stores continues to operate as normal, while consumption is increasing across the country following the relaxation of quarantine regulations in China.