The Chinese famous retail company Miniso has been making new progress in domestic market expansion and overseas business arrangement. According to it's second quarter report of 2021 on February 25, Miniso obtained both growth in operating income and profits, and the share price was up by about 15 % on the same day.

Instead of satisfied with its current success, Miniso is diving into the market of art toys to earn the heart of young consumers with new IP and sub-brands.

Growth in operating income and profits

According to its report, Miniso achieved an operating revenue of about 2.298 billion yuan, an 11% increase from the first quarter, and a net income of 1,500 million yuan, up by 70% from the first 3 months.

It’s said by insiders that the double growth achieved by Miniso is a hard-won result, which reveals the fast recovery of its business in post-pandemic era.

Judging from the details, the increase in store number and a single store income contributed to the 11% operating revenue growth; and the sequential growth of overseas income, the increased number of overseas stores and each of their higher operating revenue are signs of Miniso’s recovered overseas business.

It’s estimated that the next quarter will see a revenue increase of more than 40%, and a net income a 643 million yuan, up by 23%.

Zhang Saiyin, CFO of the company, said that they have achieved satisfying results in 2020, and will steadily consolidate their leadership in domestic market and expand overseas market share in the future for long-term stock value.

Accelerated expansion

Miniso was set up in 2013, and has now become an independent leading retailer in the world. The company is constantly offering daily commodities of 11 categories from over 8,000 SKU by quick innovation, cooperation and digitalized supply chains.

Within a time span of 7 years, the company has marched into markets of 90 regions in the world and set up 4,514 stores, among which 2,768 are in China.

Based on its official data, Miniso moved in the opposite during the pandemic in 2020, and registered 303 new stores, opened new markets in Iceland and Portugal.

The expansion even accelerated during the second half of 2020, with around 50 new stores overseas, which equals to 60% of the number of new stores of the whole year.

Ye Guofu, the founder of the company, sees the expansion as a display of partners’ confidence in its business mode and future.

Their confidence makes sense. Data from Frost & Sullivan shows that the GMV of Miniso accounted for 5.2% of global volume in 2019. It’s now “the world’s largest independent retailer”.

Insiders believe a functional supply chain, high cost-effective production contribute to the large market share of Miniso.

Youngsters magnet

Compared with growing income, number of stores, consumers remain the basic of Miniso’s strategic development. As post-90’s and Gen Z become the major consumption group, it is increasingly urgent for Miniso to grasp their attention.

Inspired by the vigorous market of art toys, Miniso released its first flagship store “TOP TOY” in Guangzhou on December 18, 2020.

Its commodity includes 7 major categories, and the store is publicizing art toy culture by combining exhibitions and rare goods.

The store turned out to be a big success. Visits of the first month reached over 200,000, and income of workday remains steadily above 100,000 yuan and transaction per customer is over 200 yuan. Within 45 days, the revenue of offline store and robot store broke through 10 million yuan.

Insiders said that art toy is a representative of the new consumption trend of Gen Z, which has been accurately spotted by Miniso with the success of TOPTOY.

The heated market of arr toy is mixed with challenges, which Miniso has comparatively avoided with a different approach.

Unlike PoP Mart, Miniso is more focused on "integration", which can be seen in its major investment in the downstream industry chain and cooperation with supplier in 90% of its products for diversified competition.

In 2021, Miniso will release the "X-Strategy" developing plan for diversified operation and building a world-leading retailing platform. It’s aiming at attracting young consumers with various brands, industries and channels, and explore more business expansion opportunities. With deeper insight of the retailing industry, Miniso hopes to learn about the future and imaginative space of new consumption.