Asia’s discount retailers are aping Japanese or Korean culture, but it turns out most of their products – and their operations – are from China. Is this necessarily a bad thing, when customers can’t get enough?
O nly a decade ago, the term “fake goods” conjured visions of counterfeit monogram bags and other faux designer items. Today, the same label is being applied to a growing number of discount chains of questionable origin.
Miniso, Mini Good, Mumuso, Yubiso, Yoyoso, Ximiso, Ilahui, Nome, Youi… the long, ever-growing list of names sounds more like a children’s rhyme than a tally of discount chains. But over the past few years – from historic shop buildings on the streets of Vancouver to glossy new storefronts of mega malls in Seoul – the world has seen the proliferation and rapid rise of dollar-store brands – many originating from China – selling everything from fuzzy bath slippers to brightly-coloured USB cables.
Miniso is at the helm of this trend. The retailer first emerged in 2013, and has become a global phenomenon over the past five years. Last year, with over 2,600 stores in more than 60 nations, the brand hit US$1.8 billion in sales thanks to its “three high, three low” business model: high efficiency, high technology, high quality; and low price (products are priced between US$1 and US$30), low cost and low margin.
But while their products are well received, consumers remain confused by the brand’s backstory.
“When I first visited Miniso, I thought the store and its products were either from Japan or Korea,” said Andrea Mak, a 36-year-old Hongkonger who frequents their local outlets. “The items they sold, like seahorse-shaped silicone tea infusers, resembled things you’d find at Muji, while the shop decor was like being inside of Uniqlo.”
Mak is not the only one to bring this up. Miniso has often been accused of copying several Japanese brands. When the retailer first appeared, with its now-ubiquitous red-and-white logo featuring a stylised shopping bag, many found its shopfronts and branding uncannily similar to Japanese fast-fashion brand Uniqlo.
Meanwhile, Miniso’s minimalist homewares are viewed as being of a similar vein to Japanese lifestyle brand Muji. And finally, its business and retail model are often compared with Japanese discount chain Daiso. But perhaps the most serious claim the brand faces is one of cultural appropriation, as critics say the brand is trying to portray itself as culturally Japanese.
On its website, the discount chain calls itself a “Japan-based designer brand” founded in Tokyo by Japanese designer Miyake Junya and Chinese entrepreneur Ye Guofu. The company has since disclosed that the bulk of its operations is based in Guangzhou. Between 80 per cent and 85 per cent of its products are produced in China, and 10 per cent to 15 per cent are made in neighbouring regions such as South Korea and Taiwan, according to an employee at a Hong Kong branch.
These days, despite its claims of being headquartered out of Tokyo, Miniso is referred to as a Chinese company. Co-founder Miyake Junya has even been accused of being a hired actor. Most surprising, however, is that all this controversy has had little impact on the brand’s astonishing success.
In September, Miniso announced that it received 1 billion yuan (US$143.97 million) in funding from Chinese technology giant Tencent Holdings and Hillhouse Capital, a hedge fund that made its name by being an early backer of Chinese internet firms such as JD.com and Baidu. With plans to undergo massive expansion in new markets such as Romania and India, Miniso has lofty ambitions to reach 100 billion yuan in sales and open 10,000 retail outlets by 2020.
Through its aggressive global outreach strategy, the brand even managed to become the first franchise in the world to open an outlet in North Korea. Miniso Pyongyang was ultimately rebranded as “Evolution”, due to the uproar over breaching Japanese and international trade sanctions on the hermit nation.
But the most telling sign of Miniso’s success is the horde of other “cultural copycats” it has spawned.
THE ‘KOREAN’ MINISO
Since Mumuso’s emergence in 2014, prominently sporting a “. KR” in its logo, the discount lifestyle retailer has often been accused of portraying itself as a Korean company, despite the fact that it is headquartered in and mainly operates out of Shanghai.
Mumuso has a registered office in Seoul’s commercial Gangnam district, but local media claims it only functions as a paper company. And ironically, while Japanese-inspired Miniso has a growing retail presence in South Korea where its products have been well received, its purportedly Korean iteration has no outlets in the nation, given the criticism it has garnered abroad.
In August, the South Korean embassy in Guatemala took to Facebook to issue a statement about the retailer’s South American outlets: “Mumuso has opened its stores at four major malls in Guatemala City and Mixco… They pretend to be selling Korean products, however Mumuso is not a Korean company and its products are not from Korea,” the embassy said, according to The Korea Times .
In Southeast Asian countries such as Vietnam, however – where Korean cultural exports such as K-pop, K-dramas, and K-beauty have become wildly popular over the past decade, and where younger consumers dominate the retail market in a nation where the median age in 2015 was 30.5 – Mumuso is fast becoming a household name.
“I know about Mumuso because my friends usually shop here,” said Bao Ngoc, a 17-year-old student browsing a local branch in Dong Da district, Hanoi, where the retailer has opened more than a dozen branches in the past two years. “It’s my first time here and I find the designs really cute.
