New Delhi: Miyake Junya, co-founder and chief designer of the Japan-based low-cost retail chain Miniso, has set himself an audacious target for India, which he believes is a market of “immense potential”.
Junya, who opens the first Miniso shop in India on Friday, is looking to earn Rs10,000 crore in revenue over the next two years. Founded in 2013, Miniso positions itself as a lifestyle brand and sells products in 12 categories including health, beauty, stationery, gift items, creative homeware, boutique package decoration and digital accessories at a starting price of Rs150.
The company, which retails in 60 countries through 2,000 stores, will open its first store in Ambience Mall, Vasant Kunj, Delhi, spread over 2,000 sq. ft. Subsequently, Miniso plans to open 210 stores by the end of 2018 and take the count up to 800 by 2019. The company is currently looking for franchise partners in India.
Globally, Miniso opens an average of 80-100 stores every month. “India has a good market expansion opportunity. The brand is all about fashion and lifestyle; life is moving fast in metro cities, so will Miniso. Keeping in mind the fast-paced lifestyle, we will be starting with metro cities first Delhi, Mumbai, Bengaluru, Chennai, Kolkata, Hyderabad, Jaipur and so on,” said Junya, in response to an e-mailed query.
The plan, Junya said, is to make India one of its top five markets in terms of revenue. For the year 2016-17, Miniso recorded a revenue of $1.5 billion, up from $750 million in the previous year. “The huge potential of India lies in the fact that it offers a very large customer base to tap into. With the population of India running into the billions, the scope this offers is tremendous,” he said, adding that the company is planning to open 10,000 stores in more than 100 countries by 2019, with annual revenue reaching $15 billion.
Over the years, the company has faced criticism for positioning itself as a Japanese brand despite its Chinese origins. The company, however, claims that the confusion regarding its origins can be attributed to the fact that it has both Japanese and Chinese co-founders. While Junya is from Japan, co-founder Ye Guofo is from China.
“Headquartered in Japan, Minoso also has an operations headquarters in China. Minoso was co-founded by Ye Guofo who is Chinese,” said Junya. The company claimed that it primarily sources its products from countries like Japan, South Korea, Singapore and Malaysia.
Rajat Wahi, partner, management consulting, Deloitte India, said that the company might be looking at a challenging model in India.“The company will have to build multiple distribution channels including e-commerce and teleshopping and play strong in all. The targets are ambitious, but the price point is very attractive. However, the challenge here is that this kind of category can be easily copied by others,” he said.
The Indian fashion and lifestyle market is expected to touch Rs3.94 trillion over the next five years, according to a 2016 survey by consulting firm A.T. Kearney. The market was valued at Rs2.21 trillion in 2016, growing at a compounded annual growth rate of 12%.