<section id="introduction"> <p class="leading-8 mt-7">MIXUEBINGCHENG Co., Ltd., commonly known as Mixue, has evolved from a humble ice cream stall to become the world’s largest freshly-made drinks company by store count. With over 45,000 stores spanning China and 11 overseas countries as of September 2024, Mixue has built a formidable business based on value-for-money positioning, with most products priced at approximately US$1. The company has demonstrated remarkable financial performance, with revenue reaching RMB 20.3 billion in 2023 (a 49.6% year-over-year increase) and is now pursuing a Hong Kong IPO expected to raise approximately US$500 million. Mixue’s success stems from its efficient franchise model, comprehensive supply chain infrastructure, and consistent focus on affordable quality that has resonated with consumers across Asia and beyond.</p> </section> <section id="origins"> <h2 id="humble-beginnings" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Origins and Historical Development</h2> <h3 id="founding-vision" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Humble Beginnings and Founding Vision</h3> <p class="leading-8 mt-3">The story of MIXUEBINGCHENG Co., Ltd. begins in June 1997 when Zhang Hongchao, a student at Henan University of Finance and Economics, sought a part-time job at a drinks kiosk to alleviate his family’s financial burden. This experience sparked his entrepreneurial ambitions, leading him to secure a loan from his grandmother to open his own shaved ice stall in Zhengzhou, Henan province. Zhang’s initial venture offered various shaved ice products, ice cream, smoothies, and eventually pearl milk tea. However, the path to success was not straightforward, and challenges forced Zhang to close his first shop. This setback, rather than deterring him, became a valuable learning experience that shaped the company’s future trajectory.</p> <p class="leading-8 mt-7">In 1999, demonstrating remarkable persistence, Zhang established a second ice stall, which he named "Mìxuě Bīngchéng" (蜜雪冰城), a Chinese phrase meaning "sweet snow palace". The name itself embodies the company’s identity and offering — "Mi" derived from words meaning honey or sweet, and "Xue" translating to snow. This thoughtful branding would later become synonymous with affordable quality in China’s beverage market. Zhang’s business acumen led him to focus more intently on ice cream products as soft-serve cone treats gained popularity in Zhengzhou around 2006, during a period when ice cream prices were rising. Recognizing an opportunity in market dynamics, Zhang reformulated his recipes to offer products approximately 20 percent cheaper than comparable offerings, establishing the value-for-money proposition that would become central to Mixue’s identity.</p> </section> <section id="expansion"> <h3 id="corporate-development" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Expansion and Corporate Development</h3> <p class="leading-8 mt-3">The success of Zhang’s affordable ice cream strategy paved the way for Mixue’s entry into franchising in 2008, marking a pivotal moment in the company’s history. Throughout the 2010s, Mixue Bingcheng evolved into a formalized corporate entity, extending its franchise model beyond its original region to other areas throughout China. This period saw significant investment in infrastructure development, with the company establishing research and development centers across Henan province, as well as warehousing and logistics centers designed to optimize production costs. This infrastructure expansion proved crucial for maintaining quality control and cost efficiency as the franchise network grew exponentially.</p> <p class="leading-8 mt-7">By the early 2020s, the company, formally registered as Zhengzhou Mixue Bingcheng Commerce & Trade Co., Ltd., had established itself as a dominant player in China’s beverage market. The company initially planned to go public on the Shenzhen Stock Exchange in 2022, indicating its growing ambitions and need for capital to support continued expansion. Although details about this initial public offering plan are limited in the available information, it represents an important milestone in Mixue’s corporate development trajectory and demonstrates its transition from a family business to a professionally managed corporation with significant scale.</p> </section> <section id="operations"> <h3 id="business-operations" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Business Operations and Market Presence</h3> <h3 id="product-portfolio" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Product Portfolio and Brand Architecture</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd. operates under two major brands: Mixue, focusing on freshly-made tea drinks, and Lucky Cup, specializing in freshly-made coffee. Throughout the company’s documented financial history, the Mixue brand has consistently accounted for over 95% of both total revenue and gross profit, establishing it as the undisputed flagship of the organization. The product line spans across multiple beverage categories, including tea drinks, fruit-based beverages, coffee varieties, and the company’s original offering — ice cream. Specific popular products include Peachy Spring Oolong Tea, Bountiful Passion Fruit, Strawberry Shake-Shake, Coffee Americano, Coffee Latte, and Coco Latte, all typically priced at around US$1 per item, reinforcing the company’s value-for-money positioning.</p> <p class="leading-8 mt-7">The company’s product strategy centers on providing affordable quality, with many items priced at RMB 5.9, RMB 6.9, or RMB 9.9, significantly lower than competitors in the premium bubble tea and coffee segments. This strategic pricing has allowed Mixue to penetrate deeply into lower-tier Chinese cities and rural areas where disposable income is lower but desire for affordable indulgences remains strong. The product development process is supported by substantial in-house research and development capabilities that enable the company to create a one-stop ingredients solution covering syrups, milk, tea, coffee, fruit, grains, and condiments.</p> </section> <section id="infrastructure"> <h3 id="supply-chain" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Supply Chain Infrastructure and Operational Excellence</h3> <p class="leading-8 mt-3">A key competitive advantage for MIXUEBINGCHENG Co., Ltd. lies in its comprehensive, vertically integrated supply chain infrastructure. As of September 2024, the company operated five production bases strategically located in Henan, Hainan, Guangxi, Chongqing, and Anhui provinces. These facilities collectively occupy approximately 0.79 million square meters and boast a combined annual production capacity of approximately 1.65 million tons. According to industry sources, Mixue’s production system encompasses the most comprehensive product portfolio at the largest scale in China’s freshly-made drinks industry supply chain.</p> <p class="leading-8 mt-7">To support its vast network of stores, Mixue has developed an extensive logistics system comprising 27 warehouses nationwide, totaling approximately 350,000 square meters. This represents the largest warehouse system in China’s freshly-made beverage industry. Complementing this warehousing capacity is a dedicated delivery network with unparalleled geographical coverage, spanning 31 provinces, autonomous regions, and municipalities, over 300 cities, 1,700 counties, and 4,900 towns across mainland China. This logistics infrastructure enables Mixue to maintain the deepest penetration in lower-tier markets within the industry, supporting its accessibility strategy and ensuring consistent product quality and availability across its entire store network.</p> </section> <section id="market-position"> <h3 id="store-network" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Store Network and Market Position</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd. has achieved remarkable scale through its franchise-based expansion strategy. As of September 30, 2024, the company operated more than 45,000 stores across China and 11 overseas countries, including Indonesia, Vietnam, Malaysia, Thailand, Philippines, Cambodia, Laos, Singapore, Australia, South Korea, and Japan. This extensive store network makes Mixue the largest freshly-made drinks company both in China and worldwide in terms of store count. The scale of operations is further evidenced by the volume of beverages sold through this network — approximately 7.4 billion cups in 2023 and 7.1 billion cups in just the first nine months of 2024.</p> <p class="leading-8 mt-7">In terms of market position, Mixue ranks as China’s largest and the world’s second-largest freshly-made drinks company based on the number of cups sold in 2023. When measured by Gross Merchandise Value (GMV), the company stands as China’s largest and the world’s fourth-largest freshly-made drinks company, holding market shares of approximately 11.3% in China and 2.2% globally. These statistics underscore Mixue’s dominant position in its home market and growing significance on the global stage, particularly in Asian markets where its value proposition resonates strongly with consumers.</p> </section> <section id="financials"> <h3 id="revenue" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Financial Performance and Growth Trajectory</h3> <h3 id="profitability" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Revenue and Profitability Analysis</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd. has demonstrated exceptional financial performance, characterized by robust revenue growth, strong profitability, and considerable cash flow generation. The company’s total Gross Merchandise Value (GMV) has shown consistent growth, increasing from RMB 22.8 billion in 2021 to RMB 30.7 billion in 2022, and further to RMB 47.8 billion in 2023. This trajectory continued into 2024, with GMV reaching RMB 44.9 billion in just the first nine months of the year, indicating potential for another significant annual increase.</p> <p class="leading-8 mt-7">The company’s revenue performance has been equally impressive, growing from RMB 13.6 billion in 2022 to RMB 20.3 billion in 2023, representing a year-over-year growth rate of 49.6%. This strong momentum continued into 2024, with revenue for the first nine months reaching RMB 18.7 billion, a 21.2% increase compared to the same period in the previous year. These growth rates significantly outpace the overall beverage industry average, reflecting Mixue’s successful store expansion strategy and consistent same-store sales growth.</p> <p class="leading-8 mt-7">In terms of profitability, Mixue has maintained robust net profit margins while scaling operations. Net profit increased from RMB 2.0 billion in 2022 to RMB 3.2 billion in 2023, representing a 58.3% year-over-year growth. For the first nine months of 2024, net profit reached RMB 3.5 billion, a 42.3% increase compared to the same period in 2023. The Mixue brand, which constitutes the vast majority of the business, maintained healthy gross profit margins ranging from 28.9% to 32.9% throughout the reporting periods, with the most recent figure (first nine months of 2024) standing at 32.9%.</p> </section> <section id="stability"> <h3 id="cash-flow" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Cash Flow and Financial Stability</h3> <p class="leading-8 mt-3">One of the most impressive aspects of MIXUEBINGCHENG Co., Ltd.’s financial profile is its strong cash flow generation capability. The company has consistently produced substantial net cash flows from operating activities, which have shown steady growth year after year. These cash flows amounted to RMB 1.7 billion in 2021, RMB 2.4 billion in 2022, RMB 3.8 billion in 2023, and reached RMB 5.1 billion in just the first nine months of 2024. This consistent and growing cash generation provides the company with significant financial flexibility to fund expansion, invest in infrastructure, and weather potential market fluctuations.</p> <p class="leading-8 mt-7">The company’s financial stability is further evidenced by its ability to fund significant infrastructure development and store network expansion primarily through internally generated cash flows. While specific details about debt levels and capital structure are not provided in the available information, the consistent growth in operating cash flows suggests a financially sound operation with limited reliance on external financing for day-to-day operations. This financial stability positions the company well for continued expansion and potential market challenges, providing a buffer against competitive pressures and economic uncertainties.</p> </section> <section id="funding"> <h3 id="investment" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Investment and Expansion Funding</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd. is currently preparing to access public equity markets to fund its next phase of growth. After previously planning to list on the Shenzhen Stock Exchange in 2022, the company has now pivoted toward a Hong Kong listing. According to recent reports, Mixue plans to start building a book for its IPO in Hong Kong at the end of February 2025, with an expected listing on the Hong Kong Stock Exchange in early March 2025. The offering is anticipated to raise approximately US$500 million, with BofA Securities, Goldman Sachs, and UBS appointed as joint sponsors.</p> <p class="leading-8 mt-7">This move to public markets represents a significant milestone in the company’s evolution and will provide access to capital for further international expansion, supply chain enhancements, and potential strategic acquisitions. The company has already published a draft prospectus dated February 21, 2025, signaling its advancement through the regulatory process toward public listing. The successful completion of this offering will mark Mixue’s transition to a publicly traded entity, bringing additional transparency and governance requirements but also providing liquidity for early investors and founding team members.</p> </section> <section id="social-responsibility"> <h3 id="csr" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Corporate Social Responsibility and Sustainable Practices</h3> <h3 id="social-impact" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Social Impact and Employment Creation</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd. has demonstrated a commitment to social responsibility under the leadership of its founders, Zhang Hongchao and Zhang Hongfu, who serve as chairman and vice chairman of the company’s dedicated Environmental, Social, and Governance (ESG) Committee. The company’s business model has generated substantial employment opportunities across China and its international markets. In 2023 alone, Mixue created or supported approximately 785,000 job opportunities through its corporate operations and extensive franchise network. This employment generation represents a significant positive social impact, particularly in smaller cities and rural areas where formal employment opportunities may be limited.</p> <p class="leading-8 mt-7">The company has also made strides in promoting gender equality within its ecosystem. As of the latest available data, approximately 37% of Mixue’s franchisees were female, while women constituted approximately 68% of store employees. These figures compare favorably to broader industry averages and demonstrate the company’s commitment to providing economic opportunities for women. The franchise model employed by Mixue enables entrepreneurship at a relatively accessible investment level, creating pathways to business ownership for individuals who might otherwise lack such opportunities, including women and residents of lower-tier cities.</p> </section> <section id="environmental"> <h3 id="initiatives" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Environmental Initiatives and Supply Chain Sustainability</h3> <p class="leading-8 mt-3">On the environmental front, MIXUEBINGCHENG Co., Ltd. has implemented several initiatives aimed at reducing its ecological footprint while maintaining business growth. A significant focus has been on sustainable packaging, with the company’s green packaging upgrades resulting in a reduction of polyethylene (PE) plastic consumption by over 12,700 tons in 2023. This substantial reduction demonstrates the company’s commitment to addressing the environmental impact of single-use plastics, a particularly relevant concern in the beverage industry with its high volume of disposable cups and packaging.</p> <p class="leading-8 mt-7">The company has further demonstrated its commitment to environmental innovation through strategic partnerships with academic institutions. Mixue has established a long-term industry-academia-research partnership with Jiangnan University and provided support to Westlake University specifically focused on advancing research and development related to biodegradable plastics. These collaborations represent a forward-thinking approach to environmental challenges, seeking to develop next-generation materials that could significantly reduce the environmental impact of the beverage industry as a whole.</p> </section> <section id="rural"> <h3 id="agricultural" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Agricultural Supply Chain and Rural Development</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd. has leveraged its substantial procurement needs to create positive economic impacts in rural communities through its agricultural supply chain. In 2023, the company’s agricultural procurement initiatives helped improve the livelihoods of approximately 167,000 farming households nationwide. By sourcing agricultural inputs like fruits, tea, and other ingredients directly from farming communities, Mixue creates reliable markets for agricultural producers, potentially offering more stable income streams than traditional market channels.</p> <p class="leading-8 mt-7">This approach to agricultural procurement represents a form of corporate social responsibility that is directly integrated with core business operations rather than functioning as a separate charitable initiative. Such integration tends to create more sustainable social impact, as the economic benefits for farming communities are tied to the company’s ongoing business success rather than discretionary corporate giving. While specific details about pricing structures, contract terms, and farmer support programs are not provided in the available information, the scale of impact suggests a substantial commitment to rural economic development through commercial relationships.</p> </section> <section id="challenges"> <h3 id="strategic" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Strategic Challenges and Future Outlook</h3> <h3 id="competitive-landscape" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Competitive Landscape and Market Dynamics</h3> <p class="leading-8 mt-3">Despite its current market leadership, MIXUEBINGCHENG Co., Ltd. faces increasingly intense competition within China’s rapidly evolving freshly-made drinks industry. The growing number of freshly-made drinks brands and shops in China creates challenges for Mixue’s continued store network expansion strategy, potentially leading to competition both among existing stores within its network and against external competitors. There is a risk that competitors may have already secured desirable locations for new store openings, and the company acknowledges that its measures to minimize cannibalization within its network and competition against external players may have limitations.</p> <p class="leading-8 mt-7">The value-for-money segment that Mixue has dominated is also attracting new entrants who recognize the vast market potential in serving China’s price-sensitive consumers outside first-tier cities. Additionally, as Mixue expands internationally, it encounters established local competitors with strong brand recognition and cultural adaptation in their home markets. The company’s ability to navigate these competitive dynamics while maintaining its value proposition and quality standards will be crucial for sustaining its growth trajectory in both domestic and international markets.</p> </section> <section id="expansion-opps"> <h3 id="international-expansion" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">International Expansion Opportunities and Challenges</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd.’s expansion into 11 countries beyond China represents just the beginning of its international growth potential. The company’s current international footprint is primarily concentrated in Southeast Asian markets (Indonesia, Vietnam, Malaysia, Thailand, Philippines, Cambodia, Laos, Singapore) with additional presence in Australia, South Korea, and Japan. This suggests a strategic focus on markets with cultural affinity for tea-based beverages and similar consumer preferences to its home market.</p> <p class="leading-8 mt-7">The international expansion strategy faces several challenges, including adaptation to local tastes and preferences, navigating different regulatory environments, building supply chain infrastructure in new markets, and competing with established local players. Additionally, the value-for-money positioning that has proven successful in China may require adjustment in markets with different economic conditions and consumer expectations. The upcoming Hong Kong IPO is likely to provide capital for accelerating international expansion, but successful execution will require careful market selection, cultural adaptation, and potentially strategic partnerships with local entities familiar with target markets.</p> </section> <section id="future-growth"> <h3 id="growth-vectors" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Future Growth Vectors and Innovation</h3> <p class="leading-8 mt-3">Looking ahead, MIXUEBINGCHENG Co., Ltd. has several potential vectors for continued growth beyond simple store count expansion. The company’s relatively underdeveloped Lucky Cup coffee brand presents an opportunity to capture a larger share of China’s rapidly growing coffee market, which has seen explosive growth in recent years. Given Mixue’s established infrastructure and brand recognition, a more concerted push into coffee could leverage existing assets while diversifying revenue streams.</p> <p class="leading-8 mt-7">Digital innovation represents another potential growth area, though the available information provides limited insight into the company’s current digital strategy. Implementation of advanced data analytics, enhanced customer loyalty programs, and further development of online ordering capabilities could drive same-store sales growth and improve operational efficiency. Additionally, the company’s established R&D capabilities position it well to continue product innovation, potentially entering adjacent categories such as packaged goods for retail distribution or exploring new beverage trends emerging globally. The combination of these growth vectors, supported by the capital infusion from the planned IPO, suggests significant potential for continued expansion despite the increasingly competitive landscape.</p> </section> <section id="conclusion"> <h3 id="conclusion-title" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Conclusion</h3> <p class="leading-8 mt-3">MIXUEBINGCHENG Co., Ltd. has transformed from a modest ice cream stall into a global beverage powerhouse through a clear value proposition, strategic expansion, and operational excellence. The company’s remarkable journey reflects founder Zhang Hongchao’s entrepreneurial vision and persistent execution, resulting in the world’s largest freshly-made drinks company by store count. Mixue’s financial performance demonstrates the effectiveness of its business model, with strong revenue growth, healthy profit margins, and substantial cash flow generation providing a solid foundation for continued expansion.</p> <p class="leading-8 mt-7">The company now stands at an inflection point as it prepares to enter public markets through its planned Hong Kong IPO. This transition will provide capital for accelerated growth but also bring increased scrutiny and governance requirements. Mixue’s future success will depend on its ability to navigate intensifying competition, successfully expand internationally, and maintain its operational excellence while scaling. The company’s established infrastructure, strong brand recognition, and value-for-money positioning provide competitive advantages, but maintaining these strengths while evolving to meet changing consumer preferences will be crucial.</p> <p class="leading-8 mt-7">Looking beyond financial metrics, MIXUEBINGCHENG Co., Ltd.’s social and environmental initiatives demonstrate a commitment to responsible business practices that may become increasingly important to consumers and investors alike. The company’s impact on employment creation, gender equality, environmental sustainability, and rural development represents a holistic approach to business that balances profit with purpose. As Mixue continues its expansion journey, this balanced approach may prove to be not just socially beneficial but strategically advantageous in building consumer loyalty and brand equity in an increasingly conscious marketplace.</p> </section> <section id="notice"> <h3 id="notice-title" class="font-bold font-sans break-normal text-gray-900 dark:text-gray-100 text-1xl md:text-2xl pt-12">Notice</h3> <p class="leading-8 mt-3">The information provided in this post is for informational purposes only and should not be considered as financial advice. The opinions expressed herein are solely those of the author and are based on personal research and analysis. No representation is made as to the accuracy, reliability, or completeness of the content, and all information is subject to change without notice. You are solely responsible for any investment decisions you make, and you should conduct your own research or consult with a professional financial advisor before taking any action. Neither the author nor any affiliated party will be held liable for any losses or damages incurred as a result of reliance on this information.</p> <p class="leading-8 mt-7">This content is not an offer or solicitation to buy or sell any securities. All investments involve risk, and past performance is not indicative of future results. By accessing this post, you agree to hold the author and publisher harmless from any claims or losses resulting from your use of the information provided.</p> </section>
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