Author | Wang Xiaojuan

Editor | Zhang Xiaoling

8 years ago, at the age of 39, Ye Guofu shouted to Jack Ma across the sky: "Give up early, I'll help you with 1 billion!"

At that time, Jack Ma was the king of e-commerce, while Ye Guofu's Miniso was just an inconspicuous ten-yuan store, and no one paid attention to his shout.

Eight years later, the once "Guangzhou Afu" splurged 6.27 billion yuan, acquired 29.4% of the shares of Yonghui Superstores from jd.com and others, becoming the largest shareholder.

On the other hand, Alibaba, which had spent over 50 billion Hong Kong dollars acquiring Darunfa, ended up on the shelf.

This person who dared to challenge Jack Ma many years ago seems to have won a round against Jack Ma in offline retail; with advances and retreats, the retail trade in China has also changed. Ye Guofu has also launched a sprint towards the king of new retail in China.

However, the rapidly changing consumer environment and consumption trends have posed multiple challenges to the retail industry. Yonghui's acquisition by Yeguofu has initiated a bold gamble, and the road ahead of him is still full of thorns.

A small store taking over a large traditional retailer.

This year, there has been a major event in China's retail industryMergerwhich is the acquisition of the well-established Yonghui Superstores by the 'Ten Yuan Store' Miniso, putting Yeguofu in the spotlight.

On October 29, during an online speech, Yeguofu responded once again to many doubts about acquiring Yonghui. He stated, 'From the optional consumption of Miniso to the essential consumption of Yonghui, without bold attempts and innovations at each step, how could today's success be achieved? Without courage, where does luck come from?'

Previously, he also revealed some details about the acquisition. He mentioned that this was a quick decision but a long-planned one.

Ten years ago after visiting Costco, and in 2021 after visiting Pandao, Yeguofu also wished to have a similar commercial platform.

He finally waited for a suitable opportunity. In the past three years, Yonghui Supermarket has accumulated losses of about 8 billion, and the stock price has fallen to a near 12-year low, prompting discussions of a merger.

In an unexpected turn of events, the acquirer turns out to be Miniso. On the day of the announcement, Miniso's US stocks plunged by 17%, followed by a 24% drop in Hong Kong stocks the next day.

From a revenue perspective, Yonghui Supermarket and Miniso are not in the same league. Despite Yonghui's losses, it still generates nearly 80 billion yuan in revenue per year, while Miniso only has about 15 billion yuan.

The financial situation is also tight. Despite spending 6.27 billion yuan to acquire Miniso, by the end of June, the cash balance was only 6.233 billion yuan.

However, Ye Guofu, who is known for his gambling nature, disagrees. He said, 'If everyone can understand it, then I won't have any opportunity.'

What he sees is Yonghui Supermarket, which has been 'transformed' by Pinduoduo.

On October 19, the Yonghui Supermarket Xilongdu Store in Shijingshan, known as 'Pinduoduo in Beijing,' officially resumed business after a 'learning from Pinduoduo' closure for 29 days.

On the opening day alone, the store welcomed approximately 0.014 million payment customers, with over 0.05 million people entering the supermarket. The total sales amount reached 1.7 million yuan. Despite multiple capacity restrictions on-site, the first-day sales still exceeded six times the pre-change daily average sales.

This seems to prove that the market needs 'Pinduoduo', whoever can quickly provide services comparable to Pinduoduo can reap the dividends.

Ye Guofu openly admitted that the internal management of Miniso is also learning from 'Pinduoduo'. For example, setting up a consolation prize of 200-1000 yuan for employees; if something is damaged in the store by a customer, neither the customer nor the staff need to compensate.

Firmly acquiring Yonghui Superstores, Ye Guofu has his own reasons. In his view, despite the downgrading of consumption, China still has a huge middle-class population, and there will always be consumption of essential goods for life.

Ye Guofu has been successful. In the past few years, he led Miniso to grow against the trend in the retail market and quickly expand overseas, when the retail market was full of difficulties.

This also gives him great confidence and he wants to move up another level. After all, the business of one-dollar stores is still too small.

High-stakes Game

Looking back on Ye Guofu's past life, drama and gambling have always been in his blood.

In 2016, 'Guangzhou Afu' reserved the front page of the newspaper to challenge 'Hangzhou Lao Ma', saying 'Surrender early, I'll give you 100 million!'

The source of the event dates back to 2012 when Wang Jianlin and Jack Ma made a bet on whether e-commerce could capture 50% of China's retail market in ten years, with the loser giving the other 0.1 billion.

Both tycoons did not take the bet seriously and it was used for publicity by 'Guangzhou Afu', who is actually Ye Guofu.

At that time, he challenged Jack Ma fundamentally due to his obsession with physical stores, believing that Jack Ma's 'new retail' strategy was wrong.

In 2016, Jack Ma proposed the concept of 'new retail' to achieve online and offline integration, known as O2O. Subsequently, Alibaba invested 22.4 billion to acquire 36.16% of SunArt Retail (parent company of RT-Mart), opened Hema, and became the controlling shareholder of Intime Department Store in 2017, making bold investments for experiments.

After 8 years, with the end of internet capital expansion and the emergence of consumption downgrading, Jack Ma's new retail dream was clouded. Hema, Intime, and SunArt all downsized or were sold off one after another.

While the e-commerce giants faced setbacks in entering the retail industry, Ye Guofu thrived. His Miniso chain, which Yonghui was a major shareholder for many years, hit the jackpot by capitalizing on consumption downgrading, resembling an offline version of PDD, significantly expanding and further targeting young and low-age consumer groups.

In 2023, Miniso collaborated with the Japanese animation 'Chiikawa', causing long queues at major flagship stores. The flash store at Grandjoy Holdings Group in Jing'an, Shanghai achieved a single-store sales of 2.68 million in just 10 hours.

In 2023, Miniso collaborated with the Japanese animation 'Chiikawa', causing long queues at major flagship stores. The flash store at Grandjoy Holdings Group in Jing'an, Shanghai achieved a single-store sales of 2.68 million in just 10 hours.

On October 29, Miniso's Executive Vice President and Chief Product Officer, Dou Na, revealed that Miniso has diversified cooperation with over 150 globally renowned IP, with cumulative sales of over 0.8 billion IP products.

As of the end of the second quarter of this year, Miniso (including TOP TOY) has a total of over 7,000 global stores. In the first half of this year, Miniso achieved revenue of 7.759 billion yuan, a year-on-year growth of 25.0%.

For the future, Ye Guofu is also full of confidence. He stated that Miniso aims to become the world's number one IP design group; in the next decade, it will lead 100 Chinese brands to go global.

While the offline-focused Miniso is still growing rapidly, e-commerce giants have long been weak in growth, even this year's singles' day sales had little impact.

In the era of the disappearance of giants, Ye Guofu's acquisition of Yonghui is particularly eye-catching.

The bet between Wang Jianlin and Jack Ma has long since faded into obscurity. Ye Guofu did not bet with Jack Ma, but now everyone says he has won over the old horse.

However, after taking over Yonghui Superstores, Ye Guofu will need to tell a story that is completely different from the 'ten yuan store'. Whether Yonghui, which Tencent and JD.com have failed to revitalize, can be reborn in Ye Guofu's hands remains a big unknown.

This is also a new high-stakes game that Ye Guofu and his backers are embarking on.

In 8 years, the retail market has experienced dramatic changes, with business tycoons rising and falling. The lives of Jack Ma and Ye Guofu have taken different paths.

Meanwhile, on this vast land of China, a new business war has already begun.