Hillhouse, Tencent back Chinese low-cost retailer Miniso

Founded in 2013 by Chinese entrepreneur Guofo Ye and Japanese designer Miyake Junya, the company operates over 2,000 stores in China and a further 1,000 overseas. Miniso’s footprint covers about 70 countries, including India, Indonesia, and the Philippines, which are its three largest international markets. It claims to have a design team of around 30 people in Tokyo, while the business development division - headed by Ye - is located in Guangzhou.

Ye previously launched jewelry and accessories retailer Aiyaya, growing the business to more than 2,000 stores within five years. Miniso has achieved scale through a similar franchising model. The company sells small-ticket consumer items priced at below RMB30 and claims RMB12 billion in annual sales.

Announcing the new investment, Miniso said it wanted to have 10,000 stores across 100 countries by 2022 and annual sales of RMB100 billion. There are also plans to collaborate with Tencent and Hillhouse in smart retail, using data analytics and related technology not only to upgrade supply chain efficiency but also to develop deeper customer insights and improve the in-store experience.

While Miniso has gained traction with low-cost retail offline, the likes of Pinduoduo have achieved much the same online. The company has taken just three years to become China’s third-largest e-commerce player after Alibaba Group and JD.com, mainly through selling low-cost items in high volumes. Users can share details of products they like with friends to access bulk-buy special offers.

Pinduoduo, which raised $1.63 billion in a US IPO earlier this year, has also received substantial backing from Tencent.

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• Topics
• Greater China
• Consumer
• Expansion
• China
• Hillhouse Capital Management
• Tencent