Minimalist retailer Miniso’s India plans have gone through a sobering correction.
Last year, the Guangzhou, China-based company had said it would open 800 stores by 2020, but its current store strength—110 stores in 41 Indian cities—is nowhere close to that flashy figure.
“The best way is to go slow and steady. Currently, our goal is 150 stores by the end of 2019,” says Tyrone Li, India head for Miniso. The retailer believes this is a natural course correction that happens in new markets.
This whittling of Miniso’s plans may also be part of a drastic overall decline in consumption in India, as evident in sectors like automobiles and FMCG. Miniso’s own revenues in the country, which fell from Rs700 crore ($98 million) in 2017 to Rs180 crore in 2018, are expected to partially recover and close this year around Rs480 crore.
In fact, the company, which sells everything from bottles and mobile phone covers to stationery, has now begun making a select range of its products in India, and hopes to create an export-focused manufacturing hub in the country.
In an interview with Quartz, Li said an India-specific aesthetic may also be in the offing. Edited excerpts:
Do Miniso’s stores now have products manufactured in India?
India has started meaning a lot more to us now. When we first came to India, we only looked at it as a good market to sell our products. However, over time, the country has started meaning a lot more to us. We have been able to forge relationships with some good partners and are now slowly and steadily working at shifting the manufacturing base for some of our products to India. We currently have textiles and nail paints that are produced in India and are now looking at scaling operations. We would like to manufacture some key products in India going forward and export them to other countries.
What are the categories that do well here?
Beauty and cosmetics are the fastest selling products in India—nail paints, perfumes, etc, if I have to be specific.
Do you have a different inventory of products that cater specifically to the needs of tier 2, 3, or 4 cities?
All our products are designed to resound with the likes and dislikes of a wide strata of the society, and thus we don’t have a set demarcation for different cities. We are, however, looking at partnering with a company that has an intellectual property that resonates with the Indian population globally.
Are you modifying designs to suit the taste of the Indian consumer, or does your existing aesthetic work well here?
Our existing aesthetic works quite well in the country. However, in terms of beauty products we are trying to make modifications as the subcontinent offers a much larger spectrum of colour than any other country. For items like nail paints, for instance, people in other countries prefer them to be easily removable. The Indian audience, on the other hand, is quite averse to that. Therefore, we hope we can modify designs of these products at the earliest to appeal to the taste of many more Indians.
How much have sales grown over the past two years of your existence in India? Are you on course to open 800 stores till 2020?
Our sales in India over the past two years have been satisfactory. Initially, when we came to India, our expansion strategy was developed based on our growth rate in other markets and the consumption potential Indian consumers had to offer. However, since our time here, we have understood the market better and know that the previously devised strategy is not ideal to have a footprint in the country. Therefore, we are currently working on revising our plans for India to ensure we reach optimal success. In my opinion, the best way is to go slow and steady. Currently our goal is 150 stores by the end of 2019, following which we’ll chalk out a plan for 2020.