A manufacturing hub since the industrial revolution and the hometown of luxury giant LVMH’s CEO Bernard Arnault, the northern French city of Lille is famous for its historic streets lined with established upmarket shops. However, in mid-May, a “Made-in-China” whirlwind swept the centuries-old European industrial capital, with Chinese budget lifestyle retailer Miniso opening a new bricks-and-mortar store in the city’s flagship shopping center Lillenium.
A showcase for the chain’s signature mix of stylish yet affordable goods from $1.5 mugs to $4 liquid lipsticks, the new Lillois outlet is Miniso’s third location in France and its 10th opening in Europe in May alone, representing the China-grown brand’s global ambitions.
Founded in 2013 by billionaire entrepreneur Ye Guofu, who derived inspiration for the business from a family trip to Japan, Guangzhou-based Miniso positions itself as a purveyor of high-quality but low-priced lifestyle items, akin to Japanese minimalist retailers Muji and Uniqlo. To infuse the Japanese design aesthetic into his retail chain back home, Ye hired Japanese designer Miyake Junya, who later became Miniso’s chief designer.
The Japanese-inspired budget shop concept has proved popular among Chinese consumers. According to data compiled by research company Euromonitor International, as of 2019, Miniso’s market share in China’s variety-store realm hit 58.5%. Last October, Miniso successfully launched a $608 million initial public offering in New York, which has given the chain a current market capitalization of about $6.26 billion. As of March 31, the company has set up 2,812 stores across more than 300 cities in mainland China.
By sourcing intellectual property rights from the world’s top-tier entertainment powerhouses, Miniso provides an array of products featuring icons from Marvel superheroes to Disney characters, which have found favor with China’s trend-chasing and lifestyle-minded Gen Z and young millennial shoppers. The company debuts 100 new items every week, mostly crafted by an in-house team of designers who closely observe global fashion trends, to make sure that its endless and always-changing catalog of goods will never bore customers.
Entering the retail arena during a time in which e-commerce was gaining momentum, Miniso still decided to adopt an offline-first approach. The gravity-defying move has given its customers a chance to feel the merchandise and embrace serendipity, which is difficult for web-only retailers to offer. On the other hand, with its price advantage, Miniso always oozes with charm in the eyes of cash-strapped young people.
The economic recession triggered by the coronavirus pandemic has spawned a global cohort of newly budget-conscious consumers, which has given a push to low-priced retailers such as Miniso. While temporary store closures and shortened opening hours caused a 30% fall in Miniso’s income for the third quarter last year, the company still remains confident about its future prospects.
Vincent Huang, Vice President of International Business at Miniso, said in an interview with Pandaily that the pandemic poses more of an opportunity for global expansion than a stressful event. “As the pandemic has inevitably resulted in a drop in spending power, Miniso will be welcomed by more consumers worldwide,” Huang said. “Sales figures in some markets that have already recovered from the pandemic showed that Miniso has delivered better performance than local retailers.”
That has accelerated the chain’s international plans. During the past 12 months, the company has opened 364 brick-and-mortar stores globally – an average pace of one per day. Since venturing into Hong Kong in 2014, Miniso has opened 1,775 offline stores in 94 overseas markets, accounting for 40% of its total outlets.
Meanwhile, Miniso has stepped up its localization efforts by hiring fashion buyers and marketing professionals from across the globe to keep its finger on the pulse of local markets and make informed design decisions that will appeal to local customers. A representative for Miniso told Pandaily that in India, the company has purchased locally-planted spices to create a brand-new perfume line, in a bid to better respond to varying shopper preferences on the ground. In Mexico, the company has partnered with local film studios to sell products with intellectual property licensed from hit movies such as XICO’s Journey.
Huang said that relying on Miniso’s well-developed supply chain and China’s manufacturing prowess, his team will continue to provide snazzily-designed and value-for-money products to foreign customers. For example, 98% of the brand’s items sold in the US market have a price tag under $10, Huang added.
Backed by Chinese tech behemoth Tencent and hedge fund Hillhouse Capital, the company achieved 2.23 billion yuan in revenue for the fiscal quarter ended March 31, of which 440 million yuan came from overseas markets. Nikkei Asia reported that through June 2023, Miniso’s average annual overseas revenue growth may run at 30%, almost double the rate of its domestic business, with the chain’s international store count rising to 2,839 by then and overseas stores topping domestic outlets in average sales, citing data by Goldman Sachs.
In recent years, an increasing number of Chinese consumer goods brands have shown international aspirations.
Dubbed “China’s L’Oreal,” Yatsen Group is the owner of the country’s best-selling cosmetics brand Perfect Diary which broke the 100 million yuan sales record in just 13 minutes during the 2019 Alibaba Double 11 shopping festival. The New York-listed beauty giant has opened its own online store in countries across Southeast Asia, including the Philippines, Singapore and Malaysia, aiming to replicate its e-commerce miracle in these overseas markets.
Championed by Gen Z for its trendy and ultra-cheap clothes, fashion brand Shein has sparked various social media phenomena and upended the likes of Zara and H&M. On May 17, the 13-year-old start-up surpassed Amazon as the most downloaded shopping app in the US, making itself the first Chinese fast-fashion global success story.