This bubble tea chain is the 'largest brand nobody's ever heard of,' with more stores than McDonald's

For those of you who thought McDonald's and Starbucks are the world's biggest nutrient and beverage chains by fig of locations, think again.

Turns retired China's largest bubble beverage and drinks chain, Mixue Ice Cream and Tea, which whitethorn beryllium unfamiliar to many, boasts much outlets than either of the better-known chains.

The company saw its banal soar much than 40 per cent following its $444 cardinal US debut connected the Hong Kong Stock Exchange connected Monday. 

Through a large franchise network, Mixue has much than 45,000 stores spanning China and 11 overseas countries including Thailand, Singapore and Australia, arsenic of past September.

In comparison, burger concatenation McDonald's has implicit 43,000 restaurants crossed much than 100 countries, portion java elephantine Starbucks has astir 40,000 outlets worldwide.

Humble origins, debased prices

The budget-friendly chain was started by laminitis Zhang Hongchao successful 1997 arsenic a tiny shaved ice store with a homemade machine in the bluish metropolis of Zhengzhou. The concatenation has capitalized connected the increasing thirst for bubble beverage successful China and elsewhere, helping it turn into the franchise elephantine it is today.

"It's the largest marque that nobody's ever heard of," said Robert Carter, edifice manufacture expert astatine StratonHunter. "They've conscionable exploded."

Mixue has go a nationalist icon among Chinese consumers and its catchy jingle translates successful English to, "I emotion you, you emotion me, Mixue Ice Cream & Tea," acceptable to the tune of the fashionable American opus Oh! Susanna.

WATCH | Mixue's catchy jingle:

Its afloat name, Mixue Bingcheng, translates to "sweet snowfall palace" according to the company's website. Famous for its playful snowman mascot called Snow King, who wears a crown and a reddish cloak, Mixue has go fashionable among young consumers for selling effect and beverage drinks, java and crystal cream, astatine a debased price — typically about $1.

"They've got a truly absorbing pricing strategy. They support things precise low, but their merchandise prime is high," Carter said. "So that's besides allowed them to turn truly dramatically and get a batch of younger consumers from that terms point."

Bubble beverage is 1 of the fewer agleam spots connected the user beforehand successful China, with low-price operators doing peculiarly well.

Mixue controls its ain proviso chain

By the extremity of September 2024, implicit 99 per cent of the company's more than 45,000 stores were franchised, Mixue's  regulatory filings showed. Nearly each of its stores are tally by franchisees, dissimilar Starbucks, which operates 53 per cent of its stores directly.

However, Mixue does not chiefly beryllium connected franchise fees for its income, and franchise fees made up conscionable 2.4 per cent of its total gross successful the archetypal 3 quarters of 2024, according to its filings. 

Though galore spot the marque arsenic a accepted beverage retailer, it operates much similar a raw-material supplier, selling nutrient materials, packaging, and instrumentality to thousands of franchisees, according to its filings. The bulk of its revenue comes from the merchantability of merchandise and instrumentality to franchised stores, which are required to bargain these items from Mixue.

"They're not making wealth conscionable disconnected the franchise model," Carter said. "They're besides making it due to the fact that they power the proviso concatenation and thrust profits from selling the merchandise to their network."

Is North America next?

In its IPO filing successful January, Mixue said it planned to support growing, portion acknowledging that its strategy to grow its store web "may pb to contention some among our existing stores and against our competitors."

Carter believes Mixue could travel to North America because it's an country of accidental for them.

"I would expect that they volition look astatine North America. Canada and the U.S. unsocial is simply a trillion dollar edifice segment," helium said.

CBC News reached retired to Mixue but did not instantly perceive backmost extracurricular of bureau hours.

"I wouldn't regularisation it retired … with truthful overmuch migration from Asia, this marque could person contiguous marque designation successful the close locations," said Vince Sgabellone, a nutrient work manufacture adept astatine marketplace probe firm Circana. "The situation volition beryllium successful gathering their debased terms constituent model."

And though the boba concatenation has much outlets than American fast-food giants McDonald's, Starbucks and Subway globally, Mixue's income inactive trail Starbucks, Inspire Brands, which is the proprietor of Dunkin' and Baskin-Robbins, and Tim Hortons, according to Singapore-based probe steadfast Momentum Works.