Miniso’s midyear financial report for 2024 is out, and it paints a picture of steady, significant growth. Both revenue and profit continue to surge, with gross profit margins reaching new heights. The company’s aggressive push to expand globally appears to be paying off, as its store count grows at a rapid pace. By the close of Q2, the combined number of Miniso and Top Toy stores worldwide topped 7,000. Notably, the international segment of the business delivered standout results, becoming a key focus of the market’s attention.
The market’s reaction was swift. Following the release of the earnings report, Miniso’s stock price saw a sharp rise. On August 30 and September 2, its Hong Kong-listed shares jumped by over 10% across two consecutive trading days. Short-term moving averages also show a noticeable impact of the report on Miniso’s stock performance.
Analyzing Miniso’s overseas growth
Miniso’s midyear report isn’t just about growth—it also dove into where that growth is coming from. The key narrative emerging from this report is the overseas segment’s rapid expansion and increasing importance in the overall business structure. As a representative of Chinese companies that have ventured into international markets, Miniso’s revenue breakdown reveals a steady, stable domestic foundation complemented by an increasingly dynamic overseas segment.
In raw numbers, Miniso’s domestic business brought in RMB 5.027 billion (USD 708.4 million) in the first half of 2024, representing a solid year-on-year (YoY) growth of 17.2%. However, it’s the overseas division that truly outperformed, raking in RMB 2.732 billion (USD 385 million)—a 42.6% YoY increase. As domestic growth slows at the margins, the overseas business is picking up the slack and becoming a more dominant force in Miniso’s overall growth strategy.
Several factors explain why Miniso’s international segment is thriving. First and foremost is the company’s aggressive store expansion strategy. By the end of June, Miniso operated 2,753 stores overseas, a 26% YoY increase and the fastest pace of expansion in the company’s history. But store count alone doesn’t tell the full story—strong growth in overseas gross merchandise value (GMV) is underpinning the surge in revenue.
Aside from the sheer number of new stores, the structure of these outlets played a decisive role in driving profitability. Miniso operates three types of stores overseas: directly operated, franchise, and agent-operated. In the first half of 2024, the number of directly operated stores grew by 95% YoY, while agent-operated stores grew by 18%. Since directly operated stores tend to be more profitable, their rapid growth provided a significant boost to Miniso’s overall profits, which is reflected in the company’s record-high gross profit margin.
Three standout aspects of Miniso’s overseas GMV performance caught the market’s eye this season:
- Overseas GMV surged by 41% YoY, reaching RMB 6.401 billion (USD 902 million)—far surpassing the 16% growth seen in the domestic market.
- Same-store GMV for international outlets rose by 16.3%, again outperforming the domestic market’s growth rate by a wide margin.
- Despite having significantly fewer stores overseas compared to China, international GMV nearly matched domestic GMV, which stood at RMB 7.097 billion (USD 1 billion).
These results underscore the growing importance of the international market in Miniso’s overall revenue mix.
Miniso’s secret sauce: IP strategy and localization
Miniso’s success abroad isn’t just about opening more stores and growing GMV—it’s rooted in the company’s longstanding strategy of partnering with well-known IPs. Miniso’s business model revolves around collaborating with popular IPs to create co-branded products that appeal to fans of these brands. By leveraging content marketing and adjusting products based on consumer feedback, Miniso has built a loyal customer base in diverse markets.
Miniso’s ability to secure top-tier IP partnerships has been critical. The company’s scale, distribution channels, and supply chain expertise give it a unique advantage in signing deals with iconic brands. Public data shows that Miniso has partnered with more than 100 IPs to date, including the likes of Loopy, Chiikawa, Barbie, Lotso, and Pokemon. These partnerships allow Miniso to roll out a wide range of new products quickly, tailored to specific markets and consumer preferences.
For example, the Chiikawa series—one of Miniso’s current top-selling IPs—has captured the attention of young consumers with its quirky, relatable design. Beyond traditional plush toys, Miniso has diversified the product range to include everyday items like tote bags, lunch bags, mini fans, and water bottles. This approach not only appeals to fans but also opens new entry points for traffic. The Chiikawa pop-up store at Jing’an Joy City in Shanghai, for instance, set a single-day sales record despite limits on purchasing quantities and time, reflecting the IP’s strong sales potential.
Miniso’s prowess in IP partnerships forms the backbone of its global strategy, but localization has been equally important in ensuring the success of its overseas expansion. The company carefully evaluates target markets and tailors its approach to each location. Asia, excluding China, has emerged as a key market, with the largest number of stores and highest GMV in the first half of 2024. The region also saw the most new stores, and GMV growth was second only to Latin America in terms of same-store performance.
Indonesia, a critical market in Miniso’s global strategy, exemplifies how the company has localized its operations to great success. Miniso operates nearly 1,500 stores across Asia (excluding China), 300 of which are in Indonesia, including the company’s largest global store, which spans 3,000 square meters. Sales in Indonesia have been consistently strong, reflected in both GMV data and public sales figures.
Miniso’s success in the region can be attributed to four main factors:
- Economic vitality: Indonesia, for instance, boasts high economic growth and a young population, offering substantial consumer potential and supporting the company’s store expansion.
- Lower entry costs: Rent and labor costs in Indonesia and several other Asian countries are lower than in China, making it easier for Miniso to operate efficiently.
- Supply chain and channel advantages: As one of the first Chinese companies to go global, Miniso enjoys first-mover advantages in both supply chain management and distribution channels.
- Localization: Miniso’s ability to adapt its operations to local market conditions has been crucial. This includes hiring local staff, customizing product offerings, and tailoring store operations to fit local needs.
For example, in Indonesia, where infrastructure can be challenging due to the country’s many islands, Miniso has focused heavily on offline channels, with 90–95% of its business conducted through physical stores. In terms of product offerings, Sanrio IPs like Hello Kitty and Kuromi have proven extremely popular. Miniso’s decision to open a Sanrio-themed store in Indonesia in 2023 led to strong sales, showcasing how effectively the company has localized its offerings.
Miniso’s outlook
Looking to the future, Miniso faces both opportunities and challenges. The weak economic recovery in China has dampened consumer spending, particularly on discretionary goods. However, this trend has also driven demand for value-oriented products, creating a mixed outlook for Miniso’s domestic business.
On the upside, Miniso’s reliance on its IP strategy is yielding positive results, creating a strong feedback loop for growth. New IP partnerships, such as Chiikawa, are driving not only sales in China’s domestic market but also in key operational metrics like transaction volumes, SKU sales, and average transaction value. Although domestic growth may slow due to the high base and weaker recovery, there is still room for steady progress.
As for the international segment, it will likely remain the primary driver of Miniso’s growth. With its well-executed IP strategy and strong localization efforts, Miniso is well-positioned to capitalize on the vast potential of overseas markets. As interest rates begin to decline globally and policies shift to spur consumption, Miniso’s performance should align with broader market trends, offering a solid foundation for future growth.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Huang Yida for 36Kr.