This Fast Food Chain Just Beat McDonald's as the Biggest in the World
McDonald's and Starbucks have been considered the world's largest food chains for decades. Both famous food and beverage spots originating in the United States and have locations worldwide, with most living humans having some sort of brand recognition. However, according to a new report, a chain has surpassed both of them to become the biggest fast food chain in the world – and you have probably never heard of it.
Mixue Bingcheng, a Bubble Tea Brand Out of Hong Kong, Now Operates the Most Outlets Worldwide
As of September 2024, Mixue Bingcheng, the bubble tea emporium, which translates to honey snow ice city, operates over 45,000 outlets worldwide. Nearly 90% of Mixue's shops are within China. There are also locations in the Asia Pacific region, including Indonesia, Vietnam, and Malaysia. As of this week, it is the world's largest food and beverage chain "by number of stores," reports CNN. However, according to Momentum Works, it still trails other brands in one key facor—sales—including Starbucks, Inspire Brands (owner of Dunkin' and Baskin-Robbins), and Tim Hortons. Nonetheless, the Wall Street Journal reports: "Forget McDonald's. This Chinese Fast-Food Chain Is Now the World's Biggest."
It Sells Bubble Tea and Inexpensive Soft Serve
The brand, which sells soft serve for just 1 yuan (15 cents) per cone and bubble tea, experienced a significant growth in value on Monday, with shares jumping over 40 percent in its first day of trading in Hong Kong. Last week, it raised $444 million in an initial public offering, according to the Hong Kong Stock Exchange. It is currently the most immense listing in the country this year. "The demand from retail and institutional investors have been strong, as was expected," said Devi Subhakesan, co-founder at equity research firm Investory Pte.
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Most of the Profits Comes From Ingredients Sales to Franchisees
According to its recent prospectus, 99 percent of stores are franchised, and the bulk of the company's revenue comes from sales of ingredients, including milk, coffee and syrups, and equipment to its global network of over 45,000 franchisees. The model is powered by a "comprehensive end-to-end supply chain," it says. This includes procurement, production, logistics, research and development, and quality control.
They Have a "Clear Understanding of Their Demand"
"As market capacity can be uncertain in the [fresh-drinks] industry, the fact that Mixue can sell raw materials to its own franchisees and have a clear understanding of their demand gives it a lot of agency compared to others," said Kenny Ng Lai-yin, a strategist at Everbright Securities International.
The Founder Aimed to Serve People for Just "Two American Dollars"
What are some of the most unique aspects of the brands? Drinks cost very little – between 2 to 8 yuan (30 cents to $1.20) each- and there is a catchy theme song and a snowman mascot. Zhang Hongchao, the founder of Mixue, was born into a poor family and has a simple strategy: "Let people around the world eat well and drink well for just two American dollars," he previously told Chinese state media.
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