Mixue: How to Make Billions Selling a Dream and Lemonade

The chain's growth is fueled by an army of franchisees and changing dynamics in China's labor market.

- Shuli Ren

One can become a billionaire selling ice cream, lemonade, and fruit smoothies—all for less than US$1 (S$1.33). Mr. Zhang Hongchao and Mr. Zhang Hongfu, two brothers who founded China's largest freshly made drinks chain, are making a fortune by taking advantage of China's fast-shifting labor dynamics.

Mixue Group's blockbuster HK$3.5 billion (S$598 million) public listing is a marvel for a difficult food and beverage industry where even the likes of Starbucks and McDonald's are revamping their operations. With its share price surging, the Zhang brothers are now richer than Starbucks' founder Howard Schultz.

Fast-growing cash cows are hard to find in this uncertain world. By number of stores, Mixue has become bigger than McDonald's. It has over 45,000 outlets after more than doubling its locations in just three years. There is no cash burn either. In the first nine months of 2024, revenue grew 21 percent to 18.7 billion yuan (S$3.5 billion), while net profit came in at 3.5 billion yuan, a 42 percent year-on-year gain.