The Miniso discount store in the 1200 block of West Broadway has packed it in after two years. As of August the 18, the doors were locked for good and the shelves were bare.
Not coincidentally, just over a month ago, on July 11, Miniso Lifestyle Canada Inc. sought and was granted bankruptcy protection by the B.C. Supreme Court.
This filing was made in conjunction between Miniso Canada (a.k.a., the “Migu Group”) and its Chinese parent company, the Miniso Group.
The court order, made under the Companies’ Creditors Arrangement Act (“CCAA”), granted an initial 10-day stay of proceedings in favour of Miniso Canada, appointed Alvarez & Marsal Canada Inc. as CCAA monitor, and allowed Miniso Canada to receive an interim financial lifeline of $2 million, from Miniso Group.
On July 22, the court-ordered stay period was extended until September 16th.
A July 12 news release stated that Miniso Canada planned to continue serving customers as usual at its 67 stores in British Columbia, Alberta, Ontario, Quebec, Nova Scotia, and the Northwest Territories.
As of August 20, however, the Miniso store locator map only showed 48 locations across Canada: 14 in B.C., five in Alberta, 17 in Ontario, 11 in Quebec, and one in Nova Scotia.
The locator map still shows the now-shuttered West Broadway location, as well as four other locations in Vancouver.
On Tuesday (August 20), calls to the four locations, as well as Miniso’s B.C. head office in Richmond, went unanswered, but at least the phones rang. Calling the West Broadway store didn’t even result in a dial tone.
Family feud between parent and child
Miniso Canada’s sudden bankruptcy is certainly linked to the very public financial dispute with its Chinese parent that began in 2018, just a year after the chain’s expansion into Canada.
By May of that year Miniso Canada was talking grandly about expanding to 500 stores within the next three years.
But in December of 2018, the Miniso Group suddenly began legal proceedings in Canada to force its Canadian division into bankruptcy, The Chinese parent company claimed that it was owed more than $20 million by Miniso Canada.
At the beginning of January 2019, it was being reported that an out-of-court agreement had been reached in which Miniso China would take over the operations of the Miniso stores in Canada.
And in March Miniso Canada claimed that the Chinese Miniso Group had taken over.
Four months later, in July, Miniso Canada was finally driven into bankruptcy, just as the Chinese parent had wanted at the end of 2018.
Is it a dollar store, a 100-yen shop, or a 10-yuan store?
The Miniso store at 1256 West Broadway opened in April of 2017.
The store was a curiosity. All of its dollarama-quality housewares and consumer goods were labelled to look Japanese and styled with a Japanese simplicity. And the store itself bore a Japanese-looking name and logo.
But, as I wrote at the time, appearances were deceiving.
According to people who could read Japanese, the product labelling was often gibberish and the Miniso name and logo was a soundalike and lookalike riff on the branding of well-known Japanese casual wear maker Uniqlo.
Miniso was actually a sort of Chinese dollar store in disguise—what is called in China a “10-yuan store” (the yuan being the base unit of currency in China, with a little over five yuan being equal to one Canadian dollar). But, in a deceptive twist, it was styled to look like what the Japanese call a “100-yen shop”.
This chameleon marketing worked. Miniso was founded in China in 2011 and by 2017 there were about 1,800 Miniso locations in 40 countries.
In essence these locations all operated as outlet stores for the enormous factory output of one Chinese industrialist/entrepreneur by the name of Ye Guofu, who also had his factories spitting out cheap fashion accessories for another chain of stores in China called Ayaya.
Ye Guofu’s business model for Miniso, honed by his experience with Ayaya, was notable in at least two ways.
From the beginning he teamed up with a Japanese designer named Miyake Junya to ensure that everything his factories in China produced was styled with a consistent, faux-Japanese Miniso look.
And he committed to meet popular demand very rapidly—his so-called “fast-fashion” approach—lifted directly from Ayaya and made possible by nimble control of supply chains and manufacturing.
Miniso is supposedly able to bring new products from concept to store shelves in a breathtakingly short 21 days.
But for the moment, however, this “fast-fashion” approach to retailing appears to have hit a snag when it comes to the rapid creation of store locations—in Canada at least.