Before we dive deep into the SWOT analysis, let’s get the business overview of MINISO. MINISO is a Chinese low-cost retailer and variety store chain specializing in household and consumer goods, including cosmetics, stationery, toys, and kitchenware. The company was founded in 2013 by Japanese designer Miyake Junya and Chinese entrepreneur Ye Guofu. Despite its Japanese-inspired branding, Miniso is headquartered in Guangzhou, China.
Miniso’s business model is centered around offering a wide range of high-quality, stylish, and affordable products. Its product line is known for combining trendy aesthetics with practicality. The company is often compared to dollar stores and fast-fashion brands due to its business approach: it maintains low prices while rapidly updating its product offerings. Most products are priced between $1 and $30.
The company’s marketing strategy also emphasizes a commitment to environmentally friendly practices and sustainability, with some stores offering a range of natural, recyclable, and energy-saving products.
The colorful Marketing Strategy of Miniso
Miniso has rapidly expanded its global footprint with over 6,413 stores (as of 2023) in more than 80 countries, including the United States, Canada, Australia, Spain, Dubai, and India. Its aggressive expansion strategy has involved a combination of corporate-owned stores and franchising.
In addition to physical retail stores, Miniso operates e-commerce platforms in some markets, providing customers with online shopping options.
Financial Highlights for Fiscal Year 2023 ended June 30, 2023
- Revenue was RMB11,473.2 million (US$1,582.2 million), representing an increase of 13.8% year over year.
- Gross profit was RMB4,443.1 million (US$612.7 million), representing an increase of 44.7% year over year.
- Gross margin was 38.7%, compared to 30.4% in fiscal year 2022.
- Operating profit was RMB2,223.0 million (US$306.6 million), representing an increase of 152.0% year over year.
Here is the SWOT analysis of Miniso
A SWOT analysis is a strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats of a business, project, or individual. It involves identifying the internal and external factors that can affect a venture’s success or failure and analyzing them to develop a strategic plan. In this article, we do a SWOT Analysis of Miniso.
SWOT Analysis: Meaning, Importance, and Examples
Strengths
- Affordable Quality: Miniso offers a wide range of high-quality goods at very reasonable prices, making it popular among consumers who want value for their money.
- Product Variety: Miniso’s broad product range, including cosmetics, stationery, toys, and kitchenware, attracts various consumers.
- Rapid Product Turnover: The company’s fast-fashion approach keeps its offerings fresh and encourages repeat customer visits. New products are introduced in the stores frequently, which is an effective way to keep customers engaged and coming back.
- Global Brand Appeal: Despite being a Chinese company, Miniso has successfully crafted a brand identity that combines Japanese design aesthetics with global appeal. This has enabled it to expand rapidly into international markets.
- Extensive Network of Stores: With over 5,200 stores in more than 80 countries, Miniso has a solid global retail presence.
- Effective Supply Chain Management: Miniso’s ability to quickly produce and distribute products worldwide is a testament to its effective supply chain management.
- Strong Franchise Model: A strong franchising model has made much of Miniso’s expansion possible, allowing it to grow quickly with less capital investment.
- E-Commerce Presence: In some markets, Miniso has an online shopping platform, enabling it to reach more customers beyond those who visit its physical stores.
Weaknesses
- Lack of Differentiation: While the breadth of Miniso’s product offering is impressive, it faces competition from other low-cost retailers with similar product lines. This can make it difficult for Miniso to stand out in some markets.
- Dependence on Physical Stores: Miniso’s business model primarily relies on physical retail stores. While it does operate e-commerce platforms in some markets, it could face challenges if there’s a shift towards online shopping or in situations like a global pandemic where store closures become necessary.
- Perceived Quality: Despite the actual quality of Miniso’s products, the low price point could lead some consumers to perceive them as cheap or of poor quality.
- Controversy Over Origin: Some controversy has surrounded Miniso’s branding. While it presents itself as a Japanese brand, it is headquartered in China. This has led to some criticism and potential trust issues with consumers.
- Overexpansion Risk: Miniso’s aggressive global expansion could present risks. Rapid growth can strain resources and lead to operational challenges if not managed well.
- Dependence on Trends: Given Miniso’s fast-fashion model, its success largely depends on its ability to keep up with changing consumer tastes and trends. A failure to accurately predict or respond to these changes could impact sales.
Opportunities
- E-commerce Expansion: Given the increasing shift towards online shopping, Miniso has an opportunity to expand its e-commerce presence and diversify its revenue streams. This could help them reach new customers and provide additional convenience for existing ones.
- Emerging Markets: Miniso can continue targeting emerging markets with a growing middle class and increased spending power. Countries in regions such as Africa and Southeast Asia present such opportunities.
- Product Expansion: Given its wide range of categories, Miniso has the opportunity to expand its product offerings further, potentially delving into areas it hasn’t yet fully explored.
- Sustainability Initiatives: As consumers become increasingly conscious about environmental sustainability, Miniso can seize the opportunity to introduce more eco-friendly products and packaging or to highlight its existing efforts in this area. This can improve its brand image and appeal to a broader customer base.
- Partnerships and Collaborations: Miniso can collaborate with popular brands or celebrities to launch limited-edition merchandise. These collaborations can attract a new customer base and create a buzz around the brand.
- Leveraging Technology: Implementing advanced technology in their retail stores (like augmented reality, smart fitting rooms, etc.) could enhance the in-store experience for customers, increasing their satisfaction and loyalty.
Threats
- Competitive Market: The retail market, particularly the low-cost sector, is highly competitive. Miniso competes with a variety of businesses, from dollar stores to fast-fashion retailers and online marketplaces. Any of these could impact Miniso’s market share.
- Global Economic Conditions: As a global retailer, Miniso is subject to international economic conditions. Economic downturns or instability, particularly in key markets, could negatively affect its business.
- Supply Chain Disruptions: As with any retail company with a global supply chain, disruptions such as geopolitical tensions, trade restrictions, or natural disasters could impact Miniso’s operations.
- Changes in Consumer Behavior: Miniso’s success depends on its ability to predict and respond to changing consumer trends. A shift in consumer preferences away from Miniso’s product offerings could threaten its sales.
- Regulatory Risks: Operating in multiple countries exposes Miniso to various regulatory environments. Changes in regulations, or failure to comply with them, could result in penalties or damage to Miniso’s reputation.
- Health Crises or Global Pandemics: In light of the COVID-19 pandemic, it’s clear that health crises can pose significant threats to retailers, particularly those with a heavy reliance on physical stores like Miniso.
- Controversies and Missteps: Any controversies or missteps, such as confusion over the company’s branding and origin, can harm Miniso’s reputation and customer trust in the brand.
