The archive · Consumer Apps · Strategic decision · 1997–2025
Mixue bets 2-yuan ice cream plus a self-built supply chain wins China; HK IPO
Mixue (蜜雪冰城) turned 2-yuan cones and vertical supply into 46,479 stores, then a HK$110B Hong Kong listing.
Mixue Group (蜜雪冰城)
What the business is
The world's largest fresh-made beverage chain by store count: franchised ice cream and tea shops (99.8% franchised) that buy ingredients and equipment from Mixue's own factories and 27 warehouses.
Starting capital：Started with CNY 3,000 borrowed from Zhang Hongchao's grandmother (1997); Dec 2020 A round valued the company at CNY 23.3B; 2025 IPO grossed HK$3.45B.
How it started
College student Zhang Hongchao opened a shaved-ice stall in Zhengzhou in 1997; it failed, and he reopened as Mixue Bingcheng ('Sweet Snow Palace') in 1999. The turning point came in 2005 with a 1-yuan soft-serve cone when rivals charged 4–5 yuan.
What happened
Brother Zhang Hongfu joined in 2007 and built the standardized franchise system. Mixue added centralized factories from 2012 (five bases, ~1.43M tons/year capacity; 100% of core ingredients self-made), its own logistics from 2014, and went overseas in 2018. Revenue reached CNY 24.83B (+22.3%) with CNY 4.44B net profit (+41.4%) in 2024.
How it ended up
Listed on HKEX (2097.HK) 2025-03-03 at HK$202.50; opened HK$262–267 and closed +43% at ~HK$290, market cap ~HK$110.6B. The HK$3.45B IPO was 5,258x oversubscribed in the retail tranche — one of Hong Kong's most demanded offerings ever.
Background
Mixue (蜜雪冰城) is the world's largest fresh-made beverage chain by store count, built on a bet that China's low-income majority — not just city youth — would drink tea and ice cream if the price collapsed. Founder Zhang Hongchao started in Zhengzhou in 1997 with CNY 3,000 from his grandmother; the breakthrough was a 1-yuan soft-serve cone in 2005 when competitors charged 4–5 yuan.
The moat is vertical integration. From 2012 Mixue built its own factories (five bases, 100% of core ingredients self-made), from 2014 its own logistics (27 warehouses covering 90%+ of China's county-level regions within 12 hours), and its brother Zhang Hongfu's franchise system standardized stores that are 99.8% franchised. The company earns mainly by selling ingredients and equipment to franchisees, not from franchise fees (~2% of revenue).
By end-2024 Mixue had 46,479 stores in 11 countries — more than Starbucks or McDonald's — sold about 9 billion cups, and reported 2024 revenue of CNY 24.83B (+22.3%) and net profit of CNY 4.44B (+41.4%). Its mascot Snow King and theme song accumulated ~8.7B social-media views, giving the low-price brand a pop-culture footprint most premium chains lack.
On 2025-03-03 Mixue listed in Hong Kong (2097.HK): the HK$3.45B IPO was 5,258x oversubscribed in retail, shares opened ~HK$262 and closed +43% at ~HK$290, valuing the company at ~HK$110.6B — the strongest large debut in Hong Kong since 2021.
What has to be true
- The bet was on customers who could not afford 25–40 yuan bubble tea — a huge population that premium brands structurally ignored.
- Owning the whole chain let Mixue set prices its franchisees could still profit from, making the low price sustainable instead of a loss leader.
- The franchise engine (99.8% of stores) let Mixue scale to 46,000+ stores without the capital weight of company-operated chains.
- A consumer-culture flywheel (Snow King mascot, theme song) made cheap feel fun, not cheap — turning the price point into brand equity.
What can be applied
Price collapse only works if the cost side is rebuilt to match: owning factories, logistics and franchise supply let Mixue undercut everyone and still be the most profitable chain in the category.
Aftermath
As of 2025-03-04 Mixue was listed and planning to spend about two-thirds of its HK$3.45B IPO proceeds on global expansion, with existing footprints in Vietnam, Thailand, Japan, South Korea and Australia and a US push being prepared. The Zhang brothers' strategy of keeping prices at 2–8 yuan while exporting its factory-logistics-franchise model is the core growth question for 2025–2027.
Sources
- Chinese Bubble Tea Chain Mixue Soars in Hong Kong Stock Market Debut
- China's largest bubble tea chain Mixue soars 43% on Hong Kong trading debut
- How Mixue climbed to top of China's bubble tea market with $1 drinks
- Leisure tea firms seek breakout via HK floats
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