Mixue Ice Cream and Tea might not be a household name for everyone, but this Chinese firm has outpaced global giants like McDonald's and Starbucks in terms of outlet numbers. As of Monday, Mixue's shares surged nearly 30% following their debut on the Hong Kong Stock Exchange, marking a significant milestone for the company. In this initial public offering (IPO), Mixue successfully raised $444 million (£352 million), making it the largest IPO in Hong Kong for the year.
Mixue's growing popularity comes at a time when many consumers in China are facing economic hardships, including a significant property crisis and declining consumer and business confidence. Despite these challenges, Mixue continues to thrive, offering its delicious ice creams and refreshing drinks at an average price of just six Chinese yuan ($0.82; £0.65). This affordability has helped the brand resonate with customers looking for value during tough times.
Founded in 1997 by Zhang Hongchao, a student at Henan University of Finance and Economics, Mixue Ice Cream and Tea began as a part-time venture to support his family's finances. The company's full name, Mìxuě Bīngchéng, translates to "honey snow ice city." Its vibrant stores, adorned with the beloved Snow King mascot, create a unique shopping experience, often enhanced by the constant play of the firm's catchy theme tune.
According to Mixue, the company boasts over 45,000 outlets across China and 11 other countries, including popular destinations like Singapore and Thailand. This rapid expansion strategy has allowed Mixue to surpass McDonald's, which has over 43,000 locations, and Starbucks, with its 40,576 outlets. Mixue not only offers a wide range of bubble tea, iced drinks, and ice cream but also operates differently from its competitors.
While Starbucks manages more than half of its stores directly, the majority of Mixue's outlets are franchised. This franchise model enables the company to scale rapidly without the overhead associated with direct management, allowing it to focus on product quality and brand consistency.
Mixue's strong debut on the stock market stands in stark contrast to its smaller rival, Guming, which experienced a decline in its share price during its first day of trading in February. Similarly, the owner of the bubble tea chain Chabaidao faced a challenging market debut last year, further highlighting Mixue's impressive market position.
In conclusion, Mixue Ice Cream and Tea's remarkable growth story, robust market performance, and unique business strategy make it a noteworthy player in the global beverage industry. As it continues to expand its reach, the brand is poised to become a significant force in the competitive landscape of bubble tea and ice cream.
