Chinese boba giant Mixue hits Hollywood, stirring up the US market

China’s boba behemoth has landed in Hollywood. Mixue, the fast-growing megachain that boasts a bigger global retail footprint than McDonald’s, opened its first US outpost on Hollywood’s Walk of Fame last month, selling drinks for less than US$5 and ice cream for about US$1. Mixue spokesperson Xu Ping said in a written statement in Chinese that the company chose Hollywood, in the American state of California, as its first US location because the “movie capital of the world” attracts both international tourists and local consumers year-round. The store, Ping added, “aims to serve a diverse global consumer base and demonstrates the brand’s commitment to the American market”. The Hollywood opening was followed in quick succession with locations in New York’s Brooklyn, Koreatown and Chinatown neighbourhoods. More Mixue stores are coming to California, Ping said. The mega chain’s entry into Los Angeles’ boba, or bubble tea, market comes at a time when US shops are struggling with rising costs driven by tariffs and economic uncertainty. View this post on Instagram A post shared by alice & michelle | nyc foodies (@2am.eats) Bigger than McDonald’s Mixue was founded as a shaved ice stand in 1997 in Zhengzhou, in China’s Henan province, by university student Zhang Hongchao, using money borrowed from his grandmother. The store’s Chinese name, Mi Xue Bing Cheng, translates roughly to “sweet snow palace”. The store has more than 53,000 stores worldwide. The lion’s share is in mainland China, but the company also has 4,700 locations across Australia, Japan, South Korea, Thailand, Malaysia and Singapore. By comparison, McDonald’s has more than 44,000 stores worldwide and Starbucks has more than 40,000. The company debuted on the Hong Kong stock exchange last March, and its share value jumped more than 43 per cent on the first day of trading. Founder Zhang and his brother Zhang Hongfu, who control the company, have a combined fortune of US$8.88 billion, according to the Bloomberg Billionaires Index. Mixue can keep costs low because it is vertically integrated, says Christopher Tang, a supply chain management expert and a business administration professor at the University of California, Los Angeles. Mixue owns the factories in mainland China that produce its powders, syrups and fruit purées, giving the company greater control over pricing, Tang says. The store’s grab-and-go concept means lower rent costs. Having most of its locations concentrated in Asia means lower transport costs. Tang says the chain’s US stores may be operating as loss leaders to expand its global footprint, test the American market and demonstrate growth to investors after its listing on the Hong Kong stock exchange last year. “They can use the profit in China to subsidise the loss in the US for the sake of expansion,” Tang says. “Once [they] get the traction in the US, they can grow a little bit further. Once it grows to critical mass, they will be able to sustain the operations.” ‘It’s good, not too sweet’ On a recent Thursday evening, Mixue customers stood outside the Hollywood store – the shop does not offer seating – eating soft serve and sipping on boba milk tea and the store’s signature grape drink with taro balls. Several passers-by snapped photos with Mixue’s inflatable snow “king” mascot that stands guard outside the store entrance. Across the street, actors posed on a red carpet, which had been rolled out on Hollywood Boulevard for the premiere of a Marvel television show at the TCL Chinese Theatre. Menu items range from US$1.19 for the soft serve to US$4.99 for its “super-triple” milk tea with tapioca pearls, pudding and coconut jelly toppings. Self-service kiosks let customers order in either Chinese or English and adjust the sweetness levels in drinks, which can range from 0 per cent to 200 per cent. The chain appears to be aggressively seeking franchisees in California. QR codes posted on the store’s front window, walls and pavement signs lead to an application website for prospective franchisees in California and New York. Opening a store requires an upfront investment between roughly US$220,000 and US$920,000, depending on size and location, according to the website. Mixue does not charge franchisees ongoing royalty or advertising fees. Some Chinese customers were already familiar with the Mixue brand or were long-time fans. Tourist Kele Shi, a tech worker who is originally from Shenzhen, China, and now lives in Washington, decided to stop by Mixue's first US location after seeing videos on YouTube and the Chinese social media app RedNote. Shi had been in the neighbourhood earlier in the day to visit a museum, but decided to go to the Walk of Fame to see whether the affordable soft serve was better than Ikea’s version. “This is 80 per cent of the reason we are here,” Shi says. “It’s good, not too sweet. That’s always a compliment for Asian people.” Olivia Y, who grew up in mainland China and now lives in Torrance, Los Angeles, was picking up five drinks for her friends after a climbing session in the neighbourhood. Y says she had fond memories of eating Mixue’s ice cream – her favourite menu item – and drinking fresh lemonade while pulling all-nighters as a student in Xian, in China’s Shaanxi province, and wanted to pay the US store a visit after hearing about it on social media. View this post on Instagram A post shared by Andrew x Trinh 👩❤️👨 (@andrewxtrinh) Other customers, such as Susannah Bartram, from Nottingham, England, had never heard of the chain. She had been strolling down the Walk of Fame, parched after a three-hour guided tour of Los Angeles, when the bright red store colours caught her eye. “It’s colourful and accessible, and it’s a quick fix,” Bartram says, holding a cup of iced tea with large slices of lemon. With pearl tea – another name for bubble tea – gaining popularity in her home country, “it is just nice to see something fresh”, she says. A crowded market? On the other side of Hollywood Boulevard, local business Bopomofo Cafe was relatively quiet on Thursday night. Earlier this month, the Asian-American cafe, which sells boba and snacks – including a sandwich described by Los Angeles Times food columnist Jenn Harris as the “apotheosis” version of McDonald’s Filet-O-Fish – shared on social media that it was struggling with rising costs of goods, including matcha powder and paper goods, thanks to “trade wars and economic uncertainty”. The cafe initially mulled a price increase, but decided to first try removing some items from its menu and offering a limited food menu an hour before it closes, says Philip Wang, who co-founded Bopomofo with partner Eric Wang in 2019. Philip Wang also co-owns the Asian-American production company Wong Fu Productions. Bopomofo’s classic milk tea costs US$6.50, and blended drinks such as its guava matcha latte cost US$8. Toppings are an additional US$0.75. “[We] are not just chasing profits and a bottom line,” the cafe wrote in the Instagram post announcing the changes. “We’re also not a massive company with hundreds of locations [or thousands overseas] bankrolling our stores.” Bopomofo’s Hollywood location opened in February as an experiment to see how it would perform in a tourist-driven area, Philip Wang says. As it approaches its first year in operation, the shop has seen less traffic than its other four locations in Southern California cities with significant Asian populations, he says. A sixth location is to open in Downtown Disney this year. Wang says he has not seen a noticeable impact on the store’s performance yet in the month since Mixue opened, noting that it is still early. The holidays boosted traffic, Mixue opened in December, and business slowed in January – a dip he says is typical across the food and beverage industry. He hopes Mixue’s presence in the US might raise the profile of boba here and encourage more people to “expand their palette” and try local shops. Bopomofo is no stranger to competing in dense markets: its original location is San Gabriel, within Los Angeles County, where there are boba and tea shops on every corner. Wang says he is confident that the drinks his cafe sells, which do not use artificial flavours, syrups or powders, will continue to attract customers. But “I would be lying if I said that [Mixue’s] not on our minds,” he says.

Chinese boba giant Mixue hits Hollywood, stirring up the US market

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}With its affordable soft serve and boba, bubble tea megachain Mixue has opened its first US store opposite Hollywood’s Walk of Fame

With its affordable soft serve and boba, bubble tea megachain Mixue has opened its first US store opposite Hollywood’s Walk of Fame