Chinese companies are going global as growth slows at home

cnbc.com:

BEIJING — Some Chinese consumer brands are looking for growth overseas, in markets like the U.S. and Southeast Asia.

Take Miniso, a Guangdong-based seller of toys and household products. Sometimes called China's Muji, Miniso opened a flagship store in New York City's SoHo in February.

The store's gross merchandise value — a measure of sales over time — is clocking around $500,000 a month, with $1 million a month likely by December, founder and CEO Jack Ye told CNBC in late June.

More importantly, he said that for directly operated stores in the United States, Miniso's gross profit margin is well above 50%.

«If we can gain a firm foothold here and create a good business, we will have no problem in the U.S. overall,» Ye said in Mandarin, according to a CNBC translation. His goal is to become the first "$10 and under" retailer worldwide.

Miniso stores began popping up in mainland China nearly 10 years ago, with overseas expansion beginning in 2015 in Singapore. As of March, the company said 37% of its 5,113 stores were overseas.

Like many businesses, Miniso saw sales drop during the pandemic. More than two-thirds of its revenue still comes from China. But in the last several months, data showed a relatively rapid pickup internationally versus domestically, a result of the varying effects of the pandemic.

In the nine months ended March 31, the company said, its China revenue grew by 11% year on year to 5.91 billion yuan, versus 48% growth overseas to 1.86 billion yuan.

China's retail sales have lagged ever since the pandemic began in 2020. A slump in the housing market hasn't helped. Locals' inclination to save, rather than spend or invest, has climbed to its highest in 20 years, according to People's Bank of China surveys.