2 March 2016
The growth of the e-commerce sector has had dire implications for conventional retailers. With consumers migrating online, lured by lower prices, wider selections and convenient delivery options, the high-street trader has seen footfall drop and margins slashed, with many now struggling to break even. Against this backdrop, one conventional retail group has been posting record profits and rapidly expanding its number of outlets across the globe.
Miniso is a Tokyo-based fast-fashion outlet. After making its high street debut in 2013, it was soon a fixture in nearly every major city in the Chinese mainland. Today, it has more than 1,000 mainland stores, with outlets in many leading malls and shopping streets.
Each outlet is said to offer a range of some 3,000 product lines, with new items introduced every week.
Today, Miniso has outlets across the world, including stores in Hong Kong, Beijing, Shanghai, Los Angeles, San Francisco, Florence, Dubai, Singapore and Bangkok. "This year, we have been expanding at a rate of 80 new stores a month," said Ye Guofu, the company's co-founder and President for the Greater China region. He believes that the company’s launch has been timely and that e-tailing growth may have peaked. In light of this, he suggests that conventional retailers with a high cost-performance ratio as their selling point may well rally and return to dominating the sector.
Competitive and Cutting-edge
Miniso was founded by Mr Ye and his business partner, Miyake Jyunya, a Japanese designer. With Mr Jyunya also serving as the group's head designer, its policy is to stick to products that are "simple, natural and rich in texture." Every week, the group introduces new items, while maintaining a low-cost but cutting-edge strategy. The majority of its products are priced between Rmb10 to Rmb29, and are said to particularly appeal to middle-income and white-collar consumers aged 18-35.
Apart from its range of foodstuffs, most of Miniso's products are designed at its Japan headquarters and have to comply with stringent Japanese quality control standards. In China, the group prides itself on only working with premier suppliers, and many such products are then offered throughout its global network. Currently, about 80 per cent of its products are sourced from some 800 mainland manufacturers, nearly all of them from suppliers in the Pearl River Delta and Yangtze River Delta regions. In the midst of the challenging times currently facing the department store industry, Miniso's success seems even more impressive. A number of industry insiders have even commented that its micro-department store business model may actually be recession-proof, allowing the group to expand despite the non-conducive trading environment.
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