Autobiography of the Founder of Mixue Ice Cream & Tea

Welcome to my blog, dear readers! Today, I’m thrilled to share a story that’s not just about ice cream and tea, but a tale of resilience, innovation, and the power of dreams. This is the story of Mixue Bingcheng, or as it’s known internationally, Mixue Ice City, a brand that has become synonymous with sweet treats and a refreshing experience for millions across China and beyond.

Mixue Ice City, founded in 1997, has grown from a single store in Zhengzhou, China, to a global phenomenon with thousands of outlets. It’s a brand that has captured the hearts of consumers with its affordable yet high-quality offerings, ranging from shaved ice to milk tea, and from fruit juices to coffee. The company’s journey is a testament to the entrepreneurial spirit and the ability to adapt and innovate in a rapidly changing market.

In 2017, the founder of Mixue Ice City penned a detailed account of the company’s history, its challenges, and its vision for the future. This article, spanning over 20,000 Chinese characters, has been translated into English, offering a rare glimpse into the inner workings of a brand that has become a household name in China and is now making waves on the international stage.

Why share this story? Because it’s more than just a business narrative; it’s a human story. It’s about the brother who started it all, the sibling who joined the journey, and the team that turned a simple idea into a global brand. It’s about the lessons learned from failures, the joy of success, and the relentless pursuit of excellence.

This article is a treasure trove for anyone interested in entrepreneurship, cultural insights, or simply a good read about how a small idea can grow into a giant. It’s a story that resonates with the American dream, where hard work, determination, and a bit of luck can lead to extraordinary achievements.

So, grab a cup of your favorite beverage, settle in, and let’s dive into the world of Mixue Ice City. This is a journey of flavors, of people, and of a brand that has become a beacon of hope and inspiration for many. And remember, every great story starts with a single step, or in this case, a single scoop of ice cream.

Original Chinese Version: 蜜雪冰城背后的商业传奇：两兄弟白手起家，坐拥500亿，干出中国最大茶饮帝国

1. Where did I (the founder) come from?

1.1 Starting Small, Dreaming Big

In recent years, I’ve encountered many entrepreneurs around my age, brimming with curiosity about how we managed to open thousands of stores. When they share that they’re in their first year with about ten or so stores, I often tell them they’re quite fortunate. It took us ten years to open our first store, and now, 22 years into our entrepreneurial journey, we’ve come a long way.

It’s not uncommon for people to question our choices when they learn about our product pricing, wondering why we don’t aim for the high-end market. Similarly, when they discover we operate on a franchise model, some immediately jump to negative conclusions, associating us with scams. With the rise of internet celebrities, many well-meaning friends have sent us various popular products and brands, leading us astray at times.

These experiences have prompted me to reflect: Who are we? Where did we come from? And where are we going?

I often describe myself as the 1.5 generation of Mixue Ice Cream & Tea. My brother, Zhang Hongchao, started this business in 1997, and I joined a decade later. Fortunate to be born in this era, working alongside our team and surviving the crucial early stages with sheer determination, I’ve managed to carve out our path. This transition from my brother to me might well define the 1.5 generation.

Coming from an ordinary family background, with a hardworking brother and a grassroots team, it’s the ordinary people and their deeds that have deeply moved me over the years. As an observer in the early stages and a participant later on, I feel both the opportunity and responsibility to share our story.

Different cultures have their languages and beliefs. What keeps us going? What kind of faith is it, and what are its origins? These are questions I ponder.

The world is shaped by cause and effect, leading to diverse entities. Our current state and ideology are the results of choices made over many years. These choices, influenced by the times and our values, intertwine to form our present.

The world is diverse, and choices are not simply right or wrong. Just as different civilizations and ideologies thrive in their unique environments, our story, too, is a perspective of rights and wrongs.

A simple ice cream or a cup of tea should harbor grand dreams; an ordinary person doing seemingly insignificant tasks should have their faith. My education may be limited, and my writing skills modest, but I am willing to make the effort and start trying. Perhaps, this endeavor is another form of value.

1.2 The Payoff of Education Before the Startup

I often share with my partners: Without education, we couldn’t have left our village, there wouldn’t be the present for me and Hongchao, nor our current team. But the effects of education are not immediate; it’s like planting trees for future generations to enjoy the shade.

The stories and principles I grew up with were mostly Confucian, even though I didn’t know it then. During school holidays, my elder siblings would tell me stories that echoed what my father said. And when I saw my grandfather, he would repeat the same principles almost verbatim. Both my grandfather and father believed in the virtue of having many children, a consistent belief in our family.

Back then, these seemed like boring and outdated maxims, repeated ad nauseam. But looking back, these principles have seeped into our bones, guiding us at critical moments.

Confucianism often emphasizes humility and forbearance, which made my father a target of my mother’s lifelong criticism. Reflecting now, my father had the patience of a saint; he never resumed his education after it was interrupted by the Cultural Revolution and never took the college entrance exams again. I never heard him speak of it. It was my grandmother who felt his life was full of regrets, often shedding tears when speaking of it. But my father quietly accepted his fate, perhaps embodying the concept of fulfilling one’s duty and accepting one’s destiny.

His silence didn’t mean he lacked desires; he was the type to feel wronged but never complain. I could sense his strong determination to educate us. Our family had over 20 acres of land, and in the 90s, without advanced machinery, my parents worked the land themselves, sparing me from hard labor.

My most vivid memory is of my father teaching me to write at five or six, creating math problems for me around ten, and introducing me to English before junior high. As I did my homework, he and my mother would toil under the hot sun: weeding, spraying pesticides, fertilizing, and irrigating. The intense labor during harvests and peanut picking was as stressful as warfare.

Occasionally, I was sent to the fields as punishment when I misbehaved or didn’t want to study, to teach me the hardships of farming and the bleakness of rural life.

I can’t claim that the education we received back then was particularly effective, but without the spark of desire for education, my brother would never have gone to Zhengzhou for his studies. Without that, there would have been no street vending startup, and none of the subsequent developments. Similarly, without my father’s persistence, I could have found a thousand reasons not to continue my education, and the story would have ended there.

Contrastingly, the prevailing attitude in our village at the time leaned towards having sons drop out of school early to start working, given the common family strategy of relying on multiple sons for labor. Many thought my father was foolish for spending so much on education for all his children, especially since schooling took them away from home, making them vulnerable to bullying in the distant rural setting.

So, what I want to emphasize is that education may require a very long investment period, but it’s crucial to commit to it without expecting immediate returns. If you start calculating returns and timelines, you’ll miss the point, as the benefits of education are not always immediately visible. It’s a form of virtue that will yield rewards eventually, without demanding immediate returns from the effort put in.

Reflecting on my childhood always brings a smile to my face. The reason I write is that some of those early experiences have surprisingly provided significant assistance in my entrepreneurial journey, such as storytelling.

As my siblings studied in Shangqiu and I was the only child at home in Kaifeng, I enjoyed my parents’ undivided attention. However, material comforts were scarce, and my greatest pleasure was probably the few boxes of books we had upstairs.

I remember a magazine I particularly liked called “Youth Science,” which described a stove that heated food without flames or high temperatures. It worked by causing the water molecules inside the food to move rapidly, generating heat safely and quickly. This was my first introduction to what we now know as the microwave oven, a common household item.

Those boxes also contained various publications like “People’s Daily,” “Student Learning Newspaper,” “Selected Chinese Mythology Stories,” “Story King,” “Joke Collection,” “Award-Winning Essays,” and textbooks on history, geography, chemistry, physics, biology, and politics from middle school. Since writing known words on a small stool was not entertaining, I secretly read all these books in elementary school, repeatedly, until boredom led me to start over. Except for political texts, which I found utterly uninteresting and never finished.

The worlds within those books were unimaginably vibrant and colorful to a child from a secluded village. Thus, I was akin to a child from both urban and rural areas, benefiting from the advanced and influential edge of being at the periphery, which opened another window amidst the gloom.

However, it’s not enough just to absorb; sharing is also important. Children have a natural desire to share, and once I learned something others didn’t know, I was eager and willing to tell stories. As a result, on dark and windy nights, you could hear my mother calling for me through the streets, while I was huddled with village kids on a haystack, captivated by tales of Chang’e flying to the moon or Hou Yi shooting down the suns, not to mention the flameless, temperature-less microwave oven and the human moon landing stories that stretched our imaginations beyond the skies.

Thus, I earned the nickname “Story King.” Growing up, I found that rallying people around a common cause still involved storytelling to paint a vision and evoke emotions.

Every step taken counts, even those from the very beginning. I’m grateful for those days, thankful there was no internet or TikTok to distract me from reading. Otherwise, only a fool would choose books over instant entertainment. Or perhaps, even if I did indulge in reading, no one would listen to my stories, as a one-hour tale has but one climax, whereas TikTok can deliver a climax in just 15 seconds.

I firmly believe that children who love to read and share will not have bad luck.

1.3 The Philosophical Foundations of Success: From Fate to Hard Work

In this chapter, I’d like to address a commonly misunderstood concept: “Fate, Luck, and Geomancy” (一命二运三风水). At first glance, it might seem steeped in superstition, but I intend to share a more pragmatic interpretation.

Fate is the set of conditions we’re born into, immutable and unique to each individual’s life journey. While we can’t choose our origins or family, accepting our starting point doesn’t mean conceding defeat. Not every well-born individual ends up successful without effort—as seen in the case of billionaire Li Ka-shing’s sons—highlighting that a privileged start doesn’t guarantee an easy path.

Luck, or Fortune, is about action (運). It represents our capacity to adapt and adjust based on current realities, striving for resilience rather than defeat. It’s a personal endeavor, underscoring the belief that we hold the reins of our destiny through effort, not through seeking divine intervention or hoping for a stroke of luck.

Geomancy refers to the environmental and temporal context we find ourselves in. Many attribute their success to being products of their environment and era, like Lei Jun suggesting that “even a pig can fly in a strong wind.” While the era can facilitate opportunities, true success remains rare, highlighting that it’s preparation, not just timing, that aligns with opportunity. The era might offer the wind, but it’s our readiness and inner strength that allow us to soar.

Reflecting on my brother’s journey, his fate might not have seemed favorable, with predictions of hardship, yet his relentless pursuit and adaptation (“运”) have defined his path. As for the “geomancy” of his future, that’s a story for another chapter.

To summarize my thoughts thus far:

1. Uniqueness of Experience: Every life journey is unique and shaped by its era. Regardless of past struggles, it’s our proactive and passionate approach to the future that matters. It’s never too late to strive for improvement.
2. Education as Investment: Like R&D, educational investment doesn’t guarantee success but not investing guarantees none. My father’s determination to educate us despite societal skepticism is a testament to the power of unwavering commitment to education.
3. The Utility of Confucianism: Far from being outdated, Confucian principles have influenced not only our family values but also the broader cultural ethos across Asia, contributing significantly to the success of many within the “Confucian sphere.”
4. The Virtue of Helping Others: Assistance and kindness, especially in helping others grow and learn, are investments that yield long-term rewards, embodying the spirit of contributing to a larger community.
5. Curiosity and Sharing: A genuine interest in learning and sharing knowledge enriches not only oneself but also those around us. My brother, as a mentor to many, exemplifies this principle.
6. Embracing Life’s Challenges: The hardships of early life, rather than being a curse, can forge resilience and gratitude for the present, proving that adversity can lead to greater diligence and frugality.
7. No Substitute for Hard Work: The philosophy of hard work, as demonstrated by both my brother and figures like Kazuo Inamori, is essential. Knowledge of Inamori’s philosophies came later, but their essence of relentless effort was already a guiding principle.
8. The Fortune of the Diligent: Hard work and seriousness may attract initial hardships as a form of testing, but they also build a resilience that can withstand and overcome future challenges.

Each principle underscores a belief in the power of personal agency, the importance of adaptability, and the value of a supportive community. These foundations not only guide our entrepreneurial journey but also reflect a broader philosophy of life that embraces both its challenges and its opportunities.

2. The beginning of Mixue Ice City

2.1 The cold drink shop in my memory

In 1997, as I was transitioning from elementary to middle school and approaching adolescence, my curiosity about the world beyond our small town began to deepen. News from my brother, who was in Zhengzhou, was always a source of excitement for me. I admired him immensely, believing that his knowledge and capabilities would surely lead him to great success in the big city. The thought filled me with pride and excitement for the future, where I envisioned visiting him and exploring the provincial capital together.

One spring day, which month I can’t recall, I overheard a cousin who had returned from Zhengzhou mention that my brother was planning to open a cold drink shop. He had asked her to convey a message to our parents, hoping they could scrape together some money to support his venture. At the time, my understanding of what a cold drink shop could be was wildly off mark. Having read about “thermal printing” in magazines, I mistakenly thought he was venturing into some high-tech printing business. The realization that he intended to sell chilled beverages instead, something entirely new to me, was both a surprise and a delight. Given my childhood longing for ice cream and soda—luxuries I rarely enjoyed—the idea of visiting his shop in Zhengzhou filled me with eager anticipation.

In August of that summer, my father and I visited Zhengzhou, where my brother met us at the train station and took us to his shop located at the entrance of Bai Miao Farmers Market on Dongfeng Road and Wenhua Road. The area has since been redeveloped into a technology market, erasing any physical trace of my brother’s early entrepreneurial efforts. His shop was a modest two-square-meter space, equipped with a freezer, a desk with a shaved ice machine, a small cutting board, and various utensils. The compact area was just enough for two people to work inside, cooled by a small plastic fan overhead. A tape player connected to a makeshift amplifier played pop music through a loudspeaker outside, adding a lively atmosphere to the tiny establishment.

My brother quickly prepared two drinks for us, which we enjoyed under a tree nearby. Though I’ve since forgotten the exact flavors, they were possibly mint or orange, and undoubtedly the most delicious beverages I had ever tasted, likely enhanced by the novelty of having actual ice cubes in them—a rarity in my prior experiences with chilled drinks.

It was only years later that I learned this shop wasn’t my brother’s first venture. He had recently moved to this location from his original shop in Jinshui Road, Yan Zhuang, an area now known as Zhengzhou’s Manhattan Business District. Back then, Yan Zhuang was a bustling urban village, a vibrant setting for my brother’s entrepreneurial beginnings.

The decision to focus on shaved ice emerged as my brother approached graduation, contemplating a stable, long-term venture beyond the various part-time jobs he had undertaken. Recalling the shaved ice stalls along a street near the sports stadium in Shangqiu, where he attended school, inspired him. These stalls served shaved ice topped with syrup, raisins, crushed peanuts, hawthorn strips, and seasonal fruits—a refreshing treat that was both drinkable and edible, yet surprisingly absent in Zhengzhou during his studies there.

In preparation, he returned to Shangqiu to closely observe and study the techniques used by these stalls. With a strong academic background in physics, chemistry, and biology, and excellent practical skills, he was confident in his ability to replicate their process. After experimenting at home and earning high praise from our grandmother for his first creation, he was emboldened to introduce shaved ice to Zhengzhou.

To fund this venture, our grandmother, acting as an angel investor and the first product tester, generously provided her savings. She even sewed a hidden pocket inside my brother’s underwear to safely carry the 3,000 RMB to Zhengzhou, protecting it from potential theft. This meticulous planning and her unwavering support were instrumental in getting the business off the ground.

Upon arriving in Zhengzhou, my brother’s first step was to deposit the now sweat-soaked money, a testament to his nervous anticipation, into a bank. The search for a suitable location led him to Yan Zhuang in Zhengzhou’s eastern suburbs, an area known for its bustling urban village atmosphere. He settled on a semi-outdoor spot in front of a rental house, securing a small but visible space for his stall.

Equipment acquisition was a blend of second-hand purchases and DIY ingenuity. A used freezer, a homemade shaved ice machine constructed from an electric motor and custom-welded components, and a tabletop repurposed from his rental home constituted the initial setup. The sound system, an essential part of creating an inviting ambiance, was crafted from parts bought at Zhongzhou Electronics Market and assembled within an old radio casing, ingeniously adapted to fit new speakers with the help of a burning coal to enlarge the holes.

This story of Mixue Ice Cream City’s origins highlights not just entrepreneurial spirit but also the importance of creativity, resourcefulness, and community support. My brother’s journey from conceptualizing the idea in Shangqiu to establishing his first shaved ice stall in Zhengzhou encapsulates the essence of innovation—turning simple concepts into a business reality through sheer determination and a hands-on approach.

2.2 The Birth of “Hanliu Shaved Ice”: A Story of Perseverance and Innovation

The journey of “Hanliu Shaved Ice” began with my brother’s hands-on approach to assembling a makeshift amplifier from components like transformers, integrated circuits, and diodes, all sourced from Zhongzhou Market—a hub for electronic parts near the train station. His knack for electronics, honed through assembling radios from scratch since middle school, made this task seem relatively straightforward for him.

The diversity of homemade syrups—ranging from strawberry to other fruits—was a testament to his dedication. He meticulously prepared each syrup by dicing fruits, mixing them with sugar, and simmering the concoction until it reached the desired thickness. These syrups were then bottled and transported to the shop, illustrating his commitment to quality and self-reliance.

Why go to the lengths of creating his own equipment and ingredients? Primarily, it was a matter of economics. With a starting capital of just 3,000 RMB, covering rent, utilities, signage, equipment, and raw materials left little room for additional expenses. Moreover, the concept of a supply chain for such niche products was virtually nonexistent at the time; if he didn’t make it himself, he simply couldn’t have it.

His rental room transformed into a makeshift kitchen, with pots, pans, and a coal stove lined up for nightly syrup production. By day, he managed sales and production solo; by night, he cleaned up and prepared syrups for the next day. This rigorous schedule mirrored the intense study periods of his past, leaving him with only three to four hours of rest each night.

Communication between him and my sister, who was working in Luoyang, was limited to late-night calls, highlighting the isolation and relentless work ethic he maintained. Despite the hardships, his shop, branded with the bold sign “Hanliu Shaved Ice,” became a beacon of refreshment in the sweltering heat, with only a small plastic fan for cooling.

Operating single-handedly, my brother’s passion and dedication were palpable. Despite the physical toll—evidenced by his salt-stained shirts and the sheer volume of sweat he described with a mix of humor and pride—his drive was fueled by the tangible results of his labor. Pricing his products between fifty cents to a dollar and a half, he managed to earn significantly more than the average wage at the time, clearing nearly a thousand RMB a month after expenses, a considerable sum compared to my sister’s 200 RMB salary.

His motivation wasn’t driven by grandiose dreams but by pragmatic goals: earning money, contributing to our family’s finances, and aspiring for a home by the age of 30 to provide for our parents. This story of “Hanliu Shaved Ice” isn’t just about the birth of a business; it’s a narrative of passion, hard work, and the joy derived from achieving self-set milestones, no matter how modest they may seem.

Reflecting on my brother’s journey through the lens of today’s entrepreneurial narratives, one might say he embodied the archetype of an entrepreneur “bearing hardship with a deep-seated grudge,” a term popularized by Jack Ma. However, it wasn’t so much about harboring any resentment as it was about immersing oneself in the intense demands of startup life—a state both he and I, through my own business ventures, came to understand and thrive in. It’s akin to parenting: to outsiders, the late nights, diaper changes, and overall exhaustion might seem daunting, yet for those living it, there’s an inherent balance of joy and challenge.

I recall an instance when we were transporting ice from the Nanyang Road meat factory. The ice wasn’t the manageable cubes produced by modern ice machines but massive blocks measuring approximately 1.2 meters in length, 60 cm in width, and 30 cm in thickness. My brother, skilled with a blade, halved two of these giant blocks to load onto our bicycles. Despite the precarious balance and the rush of traffic, it was on our way back that he stumbled and fell, struggling under the sun and amidst moving vehicles to resecure the ice, which by then had begun to melt significantly. This episode, while stressing the physical demands of his daily routine, also highlights the sheer determination and resilience required to keep the business afloat.

Such was the reality of early entrepreneurship: a constant battle against limitations, where the absence of modern conveniences meant improvising solutions—from concocting syrups to fabricating equipment. The concept of venture capital or seed funding was foreign, emphasizing a DIY ethos born of necessity rather than choice.

Handling these ice blocks without gloves led to joint inflammation in his fingers, a lingering testament to the physical toll of his commitment. The choice to use large ice blocks was out of necessity; smaller cubes and ice machines were simply not available, mirroring the need to self-manufacture syrups and equipment due to a lack of available resources.

My brother’s story is a vivid illustration of entrepreneurial grit, showing that the path to achieving one’s dreams is paved with not just innovation and persistence but also a willingness to endure and overcome the myriad challenges that come with building something from the ground up. Every day was a step closer to his goals, fueled by the satisfaction of progress and the tangible rewards of hard work.

2.3 The Resilience of a Startup: Surviving Early Challenges

The journey of my brother’s shaved ice venture in 1997, “Hanliu Shaved Ice,” encapsulates the oft-quoted entrepreneurial adage of “nine out of ten startups fail.” In its inaugural year, the business faced three critical survival challenges, illustrating the precarious nature of early-stage ventures.

The initial foray was in Yan Zhuang, a bustling urban village along Jinshui Road, where he set up shop under the awning of a photo studio. Despite an initial surge in business owing to the high foot traffic, the novelty soon wore off. The realization dawned that while the area seemed lively, the customer base was limited and repetitive, comprised mainly of the same group of residents with limited disposable income. This demographic could indulge occasionally but was not sustainable for frequent, non-essential purchases like specialty drinks. After a promising start, sales dwindled, and the venture quickly became unprofitable, leading to the closure of this first location—a victim of its site selection.

Not deterred by the initial setback, my brother relocated his operations, though the specifics of this second location remain less documented. Proximity to schools initially promised a steady stream of customers, but the arrival of summer vacation and subsequent road construction severely diminished foot traffic, sealing the fate of this venture as well. This second failure underscored the harsh realities of dependency on location and timing, elements often beyond an entrepreneur’s control.

Despite these setbacks, my brother’s approach to business—a minimal investment in non-permanent fixtures and an aversion to costly renovations—mitigated financial losses, allowing for agility and adaptability. This strategy paid off with the move to his third location near the Henan University of Economics and Law and opposite the then-bustling Henan Science and Technology Market. This spot benefited from a diverse clientele, including students and young professionals, leading to a revival in business.

By the autumn of that year, my brother had managed not only to recover but also to save a few thousand RMB, a testament to his resilience and the incremental success of his shaved ice offerings. The product itself—a combination of finely shaved ice topped with fruit syrups, preserved seasonal fruits or canned fruits, garnished with raisins, nuts, and hawthorn strips—remained a simple yet appealing treat that drew customers despite the earlier challenges.

My brother’s early experiences with “Hanliu Shaved Ice” exemplify the quintessential entrepreneurial journey of navigating through uncertainty, learning from failures, and persisting in the face of adversity. It’s a narrative that underscores the importance of resilience, flexibility, and the will to persevere—a reminder that the path to success is often paved with trials and errors, each one a stepping stone towards eventual achievement.

Autumn is a season of desolation, when a single bout of rain can bring a chill to the air. As the weather turned, so too did the fortunes of our little shop in the White Temple community, finding itself beleaguered by the harsh seasonal changes.

Faced with no other choice, as winter loomed — a season that must be endured regardless of its severity — my brother pooled together our resources. This included the savings from our frugality at the shop, a small sum my sister had managed to save from her wages, and a little money from selling the autumn harvest back home. Together, we scraped together ten thousand yuan. With this, my brother partnered with a fruit vendor he knew to start selling oranges.

However, this venture into selling oranges didn’t turn out to be profitable. The partnership had been straightforward: my brother, with his gift of the gab, took charge of sales, while the vendor and his wife handled the inventory and cash. Despite feeling like business was good, by the spring of the following year, there was little profit to share. The vendor’s wife claimed there was no profit made, and with that, it was decided — no more partnerships in the new year. So, this brief foray into selling oranges yielded nothing but experience.

Thus, by 1997, our entrepreneurial journey had seen three different ventures across three different locations. The first at Yan Village failed due to location, the second on Cuihua Road due to both location and timing, and the third at White Temple due to interpersonal issues come winter.

In the spring of 1998, as the weather warmed, we shifted focus from fruit to cold beverages, a transition that went relatively smoothly without the disruptions of relocations or roadworks. By autumn, my brother decided to lease the shop to a Fujianese jeweler and ventured into selling candied hawthorns instead.

Choosing Hefei over any other location for selling candied hawthorns was a decision that even he couldn’t fully explain. He just had a hunch that Hefei offered a promising market with better economic conditions and a populace fond of sweets. Before heading to Hefei, he even designed special packaging for the candied hawthorns, opting for a premium approach: a white bag branded “Zhang’s Candied Hawthorns,” with each treat first wrapped in glutinous rice paper, then placed in a plastic box, and finally packaged in a plastic bag.

Reality, however, was less kind. Unfamiliar with Hefei and struggling to find a good location, we soon discovered that the city’s damp winter weather was unsuitable for candied hawthorns. The sugar coating would quickly absorb moisture and melt, ruining their appearance. After a winter of effort and no earnings, we returned to Zhengzhou in the spring of 1999, defeated and penniless.

This story imparts a lesson about the importance of sticking to familiar territories. Venturing too far from home can lead to unforeseen challenges. Yet, it also reflects a human contradiction: we are inherently restless. In difficult times, we wonder if the grass might be greener elsewhere; and in good times, we dream of conquering distant lands. This duality compels us to explore, even when it leads us into the unknown.

2.4 The first Mixue Bingcheng(蜜雪冰城) store is called Mixue Bingcheng(密雪冰城)

In the spring of 1999, we returned to Zhengzhou, hoping to continue our endeavors at our shop on Dongfeng Road in the White Temple area. However, our plans were thwarted by redevelopment.

The technology market across the street was thriving, unable to meet the growing demand for computers and lifestyle improvements, leading to the demolition of the White Temple market. This area later became the new site for the technology market, eventually giving rise to the Cyber Digital Plaza we see today.

With no choice but to move, we relocated to a spot near our current company, on the southeast corner of the intersection at Wen Hua Road and Bo Song, next to the entrance of the Coal Hospital (though not in the building that stands there now). By then, we had gained some experience and confidence, taking over a larger storefront of about 60 square meters, where we set up six or seven folding tables.

As the consumer environment evolved, so did our products. We upgraded from cup-served shaved ice to dish-served snow ice and introduced a variety of fancy offerings, such as banana boats, milkshakes, and trendy sodas and floats containing bubbles and ice cream scoops. With both the product and the ambiance enhanced, we changed the shop’s name to Mixue Ice City.

Why Mixue? Because we poured sweet syrup over finely shaved ice that resembled snow, creating a delightfully sweet experience. And why Ice City? Because we offered a rich variety of about a hundred types of ice treats, likely making us the most specialized ice dessert shop in Henan Province.

The name Mixue Ice City was coined by my eldest brother, a well-read scholar who enjoys playing with words. There’s a photo of the original Mixue Ice City shop (I’ll collect and upload it later), but the sign mistakenly read “Mi” (密) instead of “Mi” (蜜), due to a misinterpretation by the sign maker. Changing the sign was expensive, so when the sign maker offered a discount of 200 yuan to keep it as is, my brother agreed to save money.

So, to be precise, the first Mixue Ice City shop was actually called “Mi” (密) Xue Ice City.

The business was thriving to the point where a loyal customer insisted on franchising, leading to the opening of a Mixue Ice City branch in Jiaozuo, named Tianwai Tian Mixue Ice City.

Everything was progressing steadily, but my restless brother couldn’t sit still. When the opportunity arose to take over an adjacent shop, he seized it.

He and an employee, Yatao, spent two nights without sleep, demolishing the dividing wall with hammers and sheer determination. After 48 hours without rest, they smoothed over the remnants of the wall with cement and lime, added more tables and chairs, and extended the original counter by a meter, creating an impressively long bar decorated with the Mixue Ice City logo.

I helped by attaching decorative green vines and other ornaments he bought from the Yellow River Food City to the walls. Watching the shop become increasingly cozy and popular was truly satisfying.

My brother figured that by the end of the spring break, if things went well, we could save a significant amount of money by 2000, making the dream of a successful life and marrying well not seem so far-fetched.

But as you might guess, the spring of 2000 brought a new municipal initiative encouraging schools and institutions to tear down walls and open up green spaces, which meant our newly established large shop was on the chopping block again.

Enduring such trials builds resilience, or in his case, armor. Even as we faced the demolition of our shop, he remained calm, perhaps not wanting to worry the family.

2.5 Low price strategy comes from empathy

In today’s digital age, many affectionately jest that Mixue Ice City is the savior of girls from humble backgrounds. This perception stems from the founder’s own origins in poverty. Growing up in challenging circumstances, facing disdain, working and studying hard, enduring heartbreak, and surviving demolitions—these were the labels that could easily describe my brother’s past. Perhaps it was these hardships that made him particularly empathetic towards his customers, understanding that life wasn’t easy for them either.

At the store on Wenlao Road and Cultural Road, the pricing strategy was aggressive in its affordability: burgers for three yuan, fries for 1.5 yuan, Yangzhou fried rice for 2.5 yuan, spicy and sour potato shreds and cabbage for 1.5 yuan, and meat dishes for five or six yuan.

Was it profitable? Yes, it was.

As an engineer-minded individual, my brother was adept at calculations. However, his focus was never on how to extract more money from customers’ pockets. Instead, he concentrated on how to lower prices to the extreme, aiming to win over more customers through affordability.

For example, when we priced our promotional burgers at three yuan, my brother would meticulously calculate the cost of two slices of bread, a piece of chicken breast, the homemade batter, the oil, and even the packaging. Overheads like electricity and labor were not factored into the cost. His principle was to operate on volume, spreading the fixed costs as thinly as possible.

This principle applied to our Chinese dishes as well. Precise amounts of potatoes, oil, and side ingredients—ensuring all were of higher quality and quantity than competitors—allowed us to calculate a precise cost. A minimal profit margin was then added to arrive at our selling price.

Why opt for such low profit margins?

Back then, without any formal business education or understanding of concepts like the “lipstick effect,” my brother was simply driven by a recognition of the struggles faced by students and others from modest backgrounds. In a time when urbanization in China was not as widespread as today, many of our customers had rural roots. Moving to big cities added financial strain to their families. Young men, eager to impress potential partners, would present a facade of affluence while skimping on meals to save money for their romantic pursuits.

The overwhelming customer support and positive reviews were the best validation for my brother’s approach of sacrificing personal gain for customer satisfaction.

When our Chinese dishes gained popularity, the neighboring restaurant closed down due to our significantly higher turnover rate. This success wasn’t due to large-scale procurement to reduce costs, as we only operated one store. Offering high quality at low prices was a deliberate choice to earn a modest income by making sacrifices.

Maintaining low profit margins required high efficiency.

Firstly, the team’s workday stretched nearly twenty hours. Employees like Chen Ping, Xiaohua, Yanzi, and Yatao lived in the store, sleeping on mats after closing. They were all hardworking individuals from humble backgrounds who shared a family-like bond and spirit of perseverance.

Secondly, a high volume of meals served and quick turnover were key. With the same revenue, we would serve two to three times more dishes than similar restaurants. My brother, acting as the head chef, and his team were trained to prepare several dishes each.

Compared to today’s kitchen environments, our back kitchen was cramped and lacked amenities like air conditioning. Working near the fryer in summer felt like enduring temperatures over 50 degrees Celsius, but we adapted.

Even with suboptimal equipment, we persevered through hardships. I recall a particularly heart-wrenching incident when Chen Ping’s hair got caught in an ice shaver, pulling a patch of scalp off. Despite the pain, she insisted on continuing work after briefly crying, refusing to go to the hospital. Such incidents left us with mixed feelings.

The journey of entrepreneurship was fraught with challenges, but our collective effort to prioritize customer satisfaction over profit eventually won their loyalty.

This approach laid the foundation for Mixue’s ethos, difficult to describe in words. Many argue that with society’s increasing wealth and consumer upgrades, the model of high quality at low prices is outdated.

Whether or not this model still holds, one must ponder: Do customers really have more money to spare? Are women’s closets lacking in clothing?

Today, many focus on business models and strategies aimed at maximizing profits—at the expense of customers, employees, and investors—without considering how to give back more to the consumers and earn their loyalty through genuine value.

3. The rise of Mixue Ice City

3.1 The birth of the second hot product

In July 2008, due to the majority of our franchise stores not making it to that year’s spring, the number of stores still in operation was quite limited. This allowed me to spend less time on store visits and more time focusing on our own shop.

Our last shop was located in the staircase entrance of the East Gate of the Yingbin Market. So, when summer arrived that year, unlike other campus stores, we didn’t close for the summer break. After all, closing the doors meant idleness for me, which wasn’t preferable.

At the time, our primary product was ice cream. However, as the weather warmed up past May, customers started to find ice cream a bit too rich and heavy. What they craved during the summer were refreshing beverages to quench their thirst and beat the heat. We didn’t have a systematic solution for our franchise stores at that point, but my brother’s store at Dongfeng Road took the lead by introducing iced porridge and fruit juices.

Following the lead of the main store and our second store, all our franchisees introduced iced porridge. At three yuan a bowl, it had a relatively high average transaction value, which we, as franchisees, appreciated. However, this higher price point meant that iced porridge wasn’t exactly flying off the shelves, with sales hovering around a hundred or so bowls per day at each franchise.

What we really needed was another blockbuster product, similar to ice cream.

In June, my brother revisited a fruit juice recipe he had created ten years ago at the start of our business venture, producing two flavors: orange and green apple. He then placed these juices in a machine that could either rotate or spray, equipped with its own cooling system, so that the juice came out chilled. Served in the commonly used 8-ounce red cola cups, and priced at just one yuan per cup, these refreshing and affordable drinks became quite popular, gradually matching the sales volume of our ice cream.

At that time, my brother had bought a second-hand juice machine for 1500 yuan. I too wanted to introduce this iced fruit juice to my store but hesitated to spend 1500 yuan on equipment, delaying the decision until July.

By July, with students on holiday and the weather extremely hot, the demand for ice cream dwindled. Pushed to the brink, I scoured the second-hand market and stumbled upon a used Dongbei brand juice machine with dual mixing tanks. I bit the bullet and purchased it.

My brother had also shared the juice recipe with our central kitchen, which began producing the concentrated juice base. This allowed us to distribute the base to our stores, where it could be mixed with water and poured into the juice machine for immediate sale.

My Dongbei juice machine served both orange and green apple flavors. Thanks to the recipe’s suitability for the current market and our unique position in Yingbin Market, offering good value with decent-sized cups, sales took off immediately upon launch.

However, it quickly became apparent that 80% of our customers preferred the orange flavor, with very few opting for green apple. Often, we’d go through three or four tanks of orange juice while the green apple barely moved. Slow sales meant the juice would gradually lose its fragrance and flavor, worsening over time.

At the time, I personally wasn’t fond of the green apple flavor either, and I started to ponder whether we could come up with another hit product to rival the popularity of the orange juice.

Coincidentally, my brother had been in business for over a decade, and his basement was a treasure trove of various items acquired throughout his entrepreneurial journey. One day, when our main warehouse was overflowing, we had to move some crispy cones to his basement for storage. During that visit, I stumbled upon a half-box of Nestle pure coffee powder.

We had been running our ice cream chain for over a year by then, and coffee was a product he had sold at Super Ice Castle the year before. Super Ice Castle had discontinued its coffee line in the latter half of 2007, but I personally had a liking for the three-in-one coffee he used to sell. So, I took that half-box of coffee powder back to my shop.

One sweaty day in July, I decided to experiment in the shop. I measured out a pot of water, added sugar to match the sweetness of our juices, mixed in some non-dairy creamer to a concentration similar to milk tea, and finally added a generous scoop of pure coffee powder.

After stirring, it turned out quite delicious! I ended up drinking three cups myself. So, I emptied, cleaned, and repurposed the juice machine that had been used for peach flavor, filled it with my coffee concoction, and hand-wrote a label for it: Cappuccino Coffee, one yuan per cup.

At that time, I had no idea how a real cappuccino was made; I was just charmed by the romantic and catchy name, inspired by a song by Elva Hsiao titled “Love is like a Cappuccino.”

To my surprise, it became an instant hit. The one-yuan-per-cup cappuccino iced coffee was incredibly appealing to students. Soon, I was making batch after batch of iced coffee, selling over a dozen pots a day, and tallying up to 800 cups in a single evening!

Looking back, I might have been the highest-selling coffee brand in the entire Henan market a decade ago. At that time, Starbucks hadn’t entered Henan, and the coffee sold at McDonald’s and KFC was hardly a hit. The immediate success of our product was due to its genuinely good taste. The sweetened, milky, three-in-one blend was universally palatable. Plus, at one yuan per cup, it was a no-lose deal, offering a chance to taste the cappuccino sung about in the song.

Luckily, from July through to winter, no one questioned the authenticity of my cappuccino. Perhaps taste is subjective, and satisfaction is paramount. My serving method was quite simple: an 8-ounce paper cup with a straw, no lid.

The iced coffee remained our best-selling summer item until 2011.

3.2 Establish a partnership system and introduce professional managers

The family discord was, in essence, a predicament stemming from the small-scale, family-run nature of our business. When everyone is from a similar small-world background, petty conflicts can easily arise. It was during this time we all realized it was crucial for the company to take a step forward. We needed to broaden our horizons and bring in more capable, visionary individuals to help transform Mixue Ice City from a simple workshop into a more formal company.

The family understood and supported this idea, agreeing that bringing in professional managers for a more corporate operation would be fairer and more transparent than relying solely on family members. At that time, we were unfamiliar with recruitment agencies, so we began to look for suitable candidates within our own networks.

Fortunately, Tao Ge (then in charge of purchasing) had a classmate with the surname Zhang, who lived in Shanghai and worked in sales at a sizable flooring manufacturing company. He was familiar with markets across the country and had experience leading large teams, and he was known for his ambition. He also had relatives who owned one of our franchise stores, so we got in touch with him.

After several discussions, he was eager to join us. So, he resigned from his job in Shanghai and bravely moved to Zhengzhou to become part of Mixue Ice City.

To better motivate everyone, my brother redesigned the equity structure, shifting from sole proprietorship to a partnership among four of us. He made Zhang the major shareholder, with himself and Tao Ge at equal shares, and I was ranked third. Thus, the four-person partnership was established.

By the spring of 2009, with Zhang onboard, we immediately began addressing some fundamental but previously overlooked aspects of the business. Firstly, Zhang led us to a designer for a logo upgrade. Our old logo, an ice cream vector image my brother found online, would likely face copyright issues today. Although it was carefully chosen and served us well, it was too narrow in scope. Zhang believed our next step should involve focusing on the tea drink market, necessitating a new logo that could represent the sweetness of Mixue Ice City beyond just ice cream.

He found a studio called Shang Hai Design, and a designer there named Zhang created a satisfactory logo for us. Money was tight, so we bargained hard, opting for just a logo without any additional applications. The fee was 800 yuan, and we used that logo for the next ten years, until 2018.

Next, we tackled the company culture, a concept we were previously unaware of. Zhang quickly established a set of values suitable for us, which we adhered to for three years:

• Pursuit: Not the first, then be the only!
• Vision: Support entrepreneurship and create jobs!
• Mission: To create a high-quality price revolution that benefits the masses!
• Core values: Keep promises; consistency between words and actions.

He also initiated the design of our first website, executed by Jue Shi Design Studio. We became friends with the designer, Mr. Liu. The website was beautiful, filled with a sweet ambiance, and featured Joe Hisaishi’s “Castle in the Sky” as background music.

Lastly, he reorganized and divided the team, setting up departments for franchising, operations, planning, finance, and distribution, giving shape to a small but structured company. The logo Zhang designed for us was used for a decade.

Importantly, he brought advanced market experience from the south. By then, Shanghai’s tea drink market was quite mature, so we added tea drinks to Mixue Ice City’s offerings, starting our exploration in this new category.

In summary, Zhang brought many advanced business concepts to Mixue Ice City, including broadening my own perspectives. I owe him thanks for my first trips to trade shows in Shanghai and market explorations in Guangdong, Guangxi, and Hunan.

Mixue Ice City gradually took on the appearance of a more structured company, and things began to operate more smoothly.

3.3 Three years of training on the front line

Following the arrival of Director Zhang and his sweeping reforms, our company began to tread a path of normal development. The shareholders, including myself, established a simple division of labor.

My brother stepped back from the company’s day-to-day affairs, handing over full responsibility to Director Zhang, and returned to managing our family’s Mixue Ice City home-style restaurant. Tao was in charge of procurement, logistics, and public relations. Director Zhang handled company strategy, development, and franchise recruitment. My role was centered on marketing, promotion, and maintaining store operations.

Our office was located in Antai Wenyuan, a residential area at the intersection of Culture Road and Sanquan Road. The space, initially purchased by my brother for personal use, was temporarily repurposed as our office.

For the next two to three years, February to May became our peak season for franchise recruitment. During these months, our sixth-floor office in the residential complex was bustling with visitors and contract signings, with 90% of the year’s new stores opening in this period.

A significant challenge at the time was dealing with visitors being stopped by the residential security or getting lost within the complex. I often had to descend six flights of stairs to meet clients at the entrance, leading to sore legs during busy periods.

This experience solidified my determination to purchase a proper office space in the future to prevent our clients from being inconvenienced by security checks and navigation issues.

After the May Day peak, inquiries and signings dwindled, and by July, new store openings ceased. This allowed us to focus on visiting existing stores, though at that time, our approach lacked a systematic process. We relied on personal observation and advice, often returning months later to find no improvements. Our reluctance to impose fines, even in the face of egregious issues, meant that our management approach was ineffective. Over time, we learned that financial penalties, though controversial, were the most effective means of ensuring compliance.

Reflecting on this period, I understand that some of our clients might still harbor resentments, but we discovered that a combination of compassion and decisive action was the most effective management strategy.

With a limited number of stores, I spent downtime assisting at my own shop in the Yingbin Market. I enjoyed working in the store, never tiring of the long hours. My girlfriend, who had left the company, joined me in working there, along with A’Miao, now our procurement officer. Our team’s stability ensured error-free meal preparation.

At that time, the company’s capacity for support was limited, prompting franchisees to innovate independently with seasonal offerings. I experimented with new products like milk tea in the winter of 2008, hot coffee and date milk in 2009, and candied haw and matcha milk tea in 2010. My efforts extended beyond winter, including a variety of juices, coconut milk, and almond dew, with successful experiments being scaled up for broader promotion by the company.

My shop served as a testing ground and direct-sales outlet, effectively doubling as a research and development arm. In a startup, everyone must contribute to innovation.

To maximize sales, I took it upon myself to design promotional materials, learning CorelDraw for flyers and Photoshop for posters. Self-taught, I used these tools primarily to highlight product names and prices, prioritizing speed and flexibility in design over aesthetic perfection.

This DIY approach to design proved advantageous: rapid response to product development, clear and straightforward messaging, easy error correction, and the acquisition of a new skill set, enriching my perspective and embodying my father’s belief that learning new skills is always beneficial.

3.4 The illusion of becoming a high-end brand

By 2010, we had been running the Mixue Ice City franchise chain for three years. The roles of the shareholders had become clearer, and although the company’s growth wasn’t rapid, we were steadily moving forward, having survived the most critical period and even managing to save a little.

My own shop, after various experiments, found its stars in ice cream and coffee, drawing a continuous stream of customers daily. With the addition of two more staff members, I no longer needed to be constantly present at the shop.

So, the question arose: How could I channel my abundant energy?

Around that time, under the leadership of Mr. Zhang, we had begun to broaden our horizons beyond Zhengzhou, exploring other cities including Hangzhou and Shanghai.

In Hangzhou, we encountered two exceptional brands, “MiGuo” and “GuoMai,” both of which offered exquisitely crafted products. Their items were not cheap, priced between 8 to 16 yuan, featuring fresh fruits like kumquats, lemons, and passion fruit, delivering a burst of freshness that made them incredibly popular. GuoMai even made its way to Zhengzhou, opening shops near the Zhengzhou University and Dongfeng Road, attracting our keen attention despite their slow start.

Then, in Shanghai, we discovered a brand with a bright yellow sign and store decoration, a cute cartoon logo, and a catchy name: Happy Lemon. This brand extensively used fresh lemon in their product lineup.

Back in Zhengzhou, a similar brand to Happy Lemon emerged, called “ShiShi TangYu,” offering products priced between 4 to 15 yuan. With its stylish decor and courteous staff, the store always had a queue at the door, making our humble team green with envy. We could spend hours outside, estimating its monthly sales in the hundreds of thousands, with such a high average transaction value leading to a speculated pure profit of 200,000 yuan!

The arrival of the American ice cream brand DQ in Zhengzhou, with its first store in Wanda Plaza and the second at Guangcai East Gate, further stirred our aspirations. Their spacious and bright stores, unique flavors (including the iconic Blizzard that wouldn’t spill if turned upside down), and their pricing strategy — 5 to 25 yuan — attracted a fashionable crowd, leaving us in awe.

In stark contrast, our own business seemed rudimentary: one yuan for an ice cream or a cup of fruit juice or iced coffee, with no creativity in product presentation; our shops were small and shabby, decorated only with posters; operated by couples with no sense of service; located in dirty, chaotic temporary structures or near farmers’ markets; catering mostly to students, seldom attracting trendy young adults. In summary, our business felt low-end, with meager profits, and we felt like we were merely scraping by.

Embarrassed to even mention we ran an ice cream franchise, we decided to create a high-end brand, anticipating the upcoming consumer upgrade (though the term “consumer upgrade” wasn’t in use at that time, that was essentially what we were aiming for). We dreamed of having a lavish shop, attracting beautiful customers, and boasting about our venture with pride.

A significant motivation to pursue a high-end brand was an invitation from Zhengzhou’s most fashionable shopping mall, Da Shanghai City, to open a store. However, upon learning about our pricing, they declined, fearing we would lower the mall’s standards (a sentiment that remains ten years later).

Faced with the glossy appeal of other stores and the humble appearance of our own, we felt a strong sense of inferiority.

Encouraged by the other two shareholders who entrusted me with this task, believing in my capabilities, I took on the challenge. My criterion for a high-end location was a young, urban gathering spot, but Zhengzhou lacked the fast-fashion malls of today, except for Da Shanghai City, which initially rejected us. So, I chose the corner of Wenhua Road and Jianxue Street, near Zhengzhou’s wealthiest schools, Zhengzhou Experimental High School and Zhengzhou No. 9 High School. The area was already home to several expensive tea brands, including ShiShi TangYu. The students from these schools, being locals, had spending power several times higher than our original customer base.

Seeking high consumer spending and a prestigious store appearance, we knew we needed a skilled designer. However, constrained by our social circles, we couldn’t find a designer as outstanding as those available today. We settled for an interior decorator skilled in rendering images. We shared our vision and photos of brands we admired, like GuoMai and Happy Lemon, with him. He quickly produced promotional images that, while derivative, still looked decent and showed clear inspiration from the two brands. Back then, the tea drink market wasn’t as vibrant as it is today, so our homage to these brands was somewhat inevitable.

As for designing a high-end product line, I had no experience but trusted my instincts as a food enthusiast. I drafted a menu inspired by GuoMai and ShiShi TangYu, spending days outside ShiShi TangYu with a DSLR camera, observing and even sending someone to work there to learn.

The secret revealed to us was eye-opening: their tea was weighed with an electronic scale to the gram, water measured to the milliliter, and many syrups and milks measured precisely in small cups. My ignorance in tea beverage standards at the time was profound; these practices were basic knowledge that we lacked.

Being somewhat proficient in ice cream, I wanted to continue offering high-end ice cream at my shop. To achieve authenticity, I even went undercover at DQ to learn how to make their Blizzard.

With back-of-house operations and design blueprints finalized, and a detailed menu of preparation methods and series ready, construction on the shop began swiftly. Based on the menu I drafted, I listed all necessary ingredients, packaging, and other materials for purchase. Our purchasing standard was to buy only the best and most expensive ingredients available, preferring cold chain logistics over ambient temperature storage, fresh fruits over jams, and using Campina’s milk base for ice cream rather than our previous powder. We even invested in a high-quality ice cream machine from Taylor, USA. Indeed, we aimed for high standards with a clear conscience. Soon after, the shop opened.

The business was booming at launch, with significant gross profits, bolstering my confidence and making me feel like I was on the verge of moving from an underdog to a successful entrepreneur. However, this excitement was short-lived as business eventually began to decline, stabilizing at a level that still allowed for a decent profit.

Shortly after, a new brand from Guangxi called DaWei Beverage opened nearby, specializing in fresh mango smoothies. At that time, our high-end shop primarily used citrus fruits, avoiding mangoes, so DaWei quickly garnered a loyal following, diminishing my customer base and pushing my profits towards the breakeven point.

Nonetheless, the shop was a success. With my previous experience in opening several shops and now this high-end venture, I became the most experienced person in our company regarding store openings. With great power comes great responsibility. In the following six months, I opened more stores directly than my brother had ever done.

First was my brother’s alma mater—Henan University of Economics and Law, which we secured a 100 square meter space in after a bidding process following its merger in 2011. Initially, all shareholders discussed the shop’s design together, but perhaps due to my outspoken nature during these discussions, the task of opening this store fell to me.

Previously, the largest Mixue Ice City shop I had opened was less than ten square meters, and the high-end shop was about forty square meters. Suddenly facing a 100 square meter space was daunting, but retreat was not an option. After extensive discussions with designer Zhang Hui, we successfully launched the store at the university.

After the launch of the store at Henan University of Economics and Law, it became an instant hit among students. Being owned by an alumnus and featuring a two-story layout with an elegant ambiance and affordable prices, it wasn’t long before it saw overwhelming daily crowds, proving the sweet success of operating a large store within a university campus.

This success was followed by openings at the Aviation Institute, the School of Economics and Trade, and Zhengzhou University. These stores, all large in scale, experienced full houses upon their openings, significantly outperforming the revenue of the high-end Jianxue Street store.

Gradually, the high-end store began to feel like more of a burden. During that period, I was dividing my energy between launching new direct-sales stores and my undercover work at DQ, leading to less frequent visits to the Jianxue Street store and a natural decline in its business. Coupled with three months of unprofitable holidays each year and a landlord who wouldn’t miss a single month’s rent, I decided to close the shop.

In September 2011, after enduring a difficult two-month summer holiday and facing a rent increase from the landlord, I resolved to shut down the Jianxue Street store. Closing it was swift; in just one day, the store was emptied. Our finance team meticulously calculated the investment return from its operation between 2009 and 2011, concluding that over two and a half years, the store had made a total profit of 6100 yuan—a figure I remember distinctly.

While we didn’t make a significant cash profit, the experience was invaluable. High-end business was not as easy as anticipated. I admit to my shortcomings, but through this venture, I gained insights into the challenges of operating a premium brand, insights I believe could be beneficial to other entrepreneurs.

First, is the move to high-end driven by broad customer demand or personal vanity? In retrospect, our own vanity played a significant role, and in justifying it, we assumed a growing demand for premium products, believing that consumer upgrades would naturally lead to higher spending.

However, true consumer upgrades involve improving product quality and experience, not necessarily prices. As naive operators, our initial thought was to raise prices to enhance prestige.

Second, the folly of wishful pricing. In the jewelry industry, it’s common to display items ten times more expensive than the average sale to set a prestige level and raise price expectations. However, this strategy doesn’t apply to frequent-purchase items like ice cream and bubble tea, where consumers seek quick, straightforward transactions.

Third, premium branding means catering to a discerning clientele, demanding high costs across all aspects—from decor and equipment to staff qualifications and materials—leading to high gross profits but low net profits after covering all expenses.

Fourth, the operator’s capability and understanding matter. What works for others might not suit one’s own background. Recognizing and accepting one’s limitations is crucial.

Although the high-end store failed, the experience of starting a new store from scratch was enriching, making future ventures smoother and more thoughtful.

Learning and evolving are continuous processes, and the lessons from that store have been invaluable, shaping my approach to business and laying a solid foundation for future operations.

The journey, including its detours, counts every step of the way. For me, having walked this path is my greatest value. The experiences gained from opening various stores prepared me well for the challenges after 2012.

While high-end success may be effortless for some, for others, it remains a beautiful fantasy. Perhaps, in business as in life, finding what suits you best is most important. Embrace who you are and live authentically, rather than envying what you cannot be.

4. What is the goal of Mixue Ice City?

4.1 Bad results from the first unannounced visit

When my brother casually suggested we inspect our stores, I sensed there might be issues, but I couldn’t fathom their severity.

We quickly arranged for a Toyota Coaster minibus and set off with a team of senior managers from various departments, totaling about a dozen people. Our journey began heading north, and crossing the Yellow River Bridge was a moment of excitement. I boasted to my colleagues about a franchisee’s store we were about to visit. This particular franchisee, a diligent and attractive young woman, had been running her store near a school in Anyang for many years, making it a benchmark in the region.

Upon arrival, the bustling scene of students inside the shop was heartening, suggesting good business. I proudly pointed out to my colleagues how much the store had evolved over the years. Originally located by a roadside in Anyang, earning a few hundred yuan a day was considered good business back then.

However, my confidence was shattered the moment we stepped into the kitchen. The contrast between the shop’s cleanliness and the kitchen’s condition was stark. The floor was sticky to the point of nearly pulling off our shoes, a clear sign of neglect and syrup spillages not cleaned for a long time. The floor was also grimy, indicating it hadn’t been cleaned in days, possibly longer. Cleaning supplies were strewn about carelessly, showing a complete disregard for food safety practices.

The most shocking discovery was a massive red plastic barrel near the sink, capable of holding about 200 kilograms of water — akin to the large garbage bins seen in residential areas. It contained a diluted syrup for making lemon water, which given its volume, was unlikely to stay fresh. Upon tasting, the syrup had a sour and spoiled flavor, but something else felt off. Upon inquiry, I learned the franchisee had concocted their own ratio for convenience.

Even more infuriating was their handling of lemons. Instead of slicing them according to our standards and muddling them in cups, they were mashing them in a 20-kilogram water bucket with a rolling pin. After mashing, they filtered the lemon juice into a five-liter jug, dehydrated the remnants, and stored the lemon pieces in another bucket for future use. The proportions and quantities used at the front counter for preparing meals were baffling and deviated entirely from our company standards.

In essence, aside from doing good business, this store had reinvented its food preparation standards, diverging completely from company protocols. We were all shocked. This was a store I had been proud of, a model of success in Anyang, run by a young and beautiful post-80s lady. If my pride and joy operated in this manner, what would we find in the other stores?

After our visit to Huanghua, we decided not to continue north as initially planned, given the similar conditions expected beyond the Yellow River. Instead, we turned our attention southward, aiming to inspect stores beyond the Yangtze River. Our journey took us through Jining in Shandong, where we found the situation to be similar, if not worse. In Shandong, a region with a high concentration of brands, not only were the hygiene standards poor, but many stores were also struggling with their business.

The mood among us was somber, the lowest point being when a colleague called out to me as “President Zhang”. In a moment of frustration, I snapped back, asking not to be addressed as such, feeling unworthy of the title.

Throughout the journey, we pondered over what had led to the current state of disarray. It’s often said that failure is the mother of success, but success can also breed failure. Years of smooth sailing had made us complacent, arrogant, and overly ambitious, leading us to overlook our flaws and set unrealistic goals.

I realized it was time for us to get back to basics, to remember where we came from and think carefully about where we were heading. Despite continuous growth, we had been caught up in day-to-day operations and hadn’t taken the time to reflect as a team. We decided to find a quiet place for serious reflection and discussion, to sort out our issues and reconnect with our original mission.

In the early days, we used to engage in outdoor team-building activities, but had neglected such practices during our rapid expansion. It was time to revive the disciplines of teamwork, goal-setting, and hard work, and to remember the struggles that brought us here. We arranged for a comprehensive outdoor training session in Baligou, Xinxiang, north of Zhengzhou, which included wilderness treks, mountain climbing, and staying in rural farmhouses. The idea seemed promising.

The first weekend back, we set off early for Baligou. In hindsight, I was not fully satisfied with the training. It was supposed to be rigorous, but the execution was lenient and didn’t meet our expectations. Nonetheless, it was a valuable experience.

After completing our training at the base of the mountain, we embarked on a climb towards the peak of the Taihang Mountains, a journey of about 30 kilometers. Our destination was a thousand-year-old village. The path became increasingly treacherous, and by the time we reached a cliff known locally as “Upper Baligou”, we were exhausted but happy, the physical strain temporarily relieving our accumulated anxieties. We supported each other and finally reached the mountaintop as night fell.

The ancient village at the summit was incredibly austere. Guoliang Village, famous online for its cliffside roads, was nearby, but the conditions here were even more primitive, lacking even those basic roads. We saw an old, rusted steel cable used by villagers to haul tractors up the mountain in pieces, a testament to the hardiness and ingenuity of the Chinese people in overcoming adverse conditions.

That night, we stayed in a stone farmhouse at the mountaintop, enjoying the peace, the stars, and the sounds of summer insects. The homemade noodles prepared by a local auntie were devoured by everyone, soup and all. We felt guilty for slaughtering a sheep, but the broth was unlike anything we’d ever tasted, incredibly delicious and fresh.

That night, within the walls of an old house plastered with newspapers yet still drafty, we held our discussion, engaging in self-criticism and critique until the roosters began to crow. We resolved to halt the signing of new stores, taking a moment to “tie our shoelaces” properly, focusing not on growth for the sake of growth but on improving our operations for natural expansion. We reminded ourselves of the saying not to forget why we started on this journey and not to move so fast that our souls couldn’t keep up. During this meeting, the chairman and I encountered some minor disagreements, particularly on whether our own staff should open their own stores. Despite airing our views, we reached no definitive conclusion, but this discussion brought our team closer, enhancing our understanding of one another. Though external conditions were harsh, our clarity and resolve grew stronger, leading to a particularly restful night’s sleep on crowded beds.

The following morning, we engaged in team-building exercises on the grass and, guided by our coach, each folded a paper airplane, inscribing our wishes before releasing them from the Taihang Mountains’ cliffs. My wish was simple: “To make the world a better place through our actions, to protect our employees, the company, and society, and to continue striving for 100 years.”

Spring 2016 marked the year we themed “Taking Root,” recognizing the need to slow down after years of rapid expansion had led us to stumble. We aimed to proceed more cautiously, ensuring our “souls” could keep pace with our steps. Consequently, we drastically reduced the number of new store openings, prioritizing operational improvements and profitability over expansion.

We shifted into a lower gear, focusing on maintaining and enhancing our existing direct stores and raising the bar for franchisee selection to decrease the number of new openings. This allowed us to devote energy to team consolidation and skill enhancement.

We set no firm targets for the year’s performance, opting for a conservative approach after the previous year’s setbacks. However, this adjustment proved to be an overcorrection.

The first to be affected was morale. Our team, accustomed to rapid progress, struggled with the sudden halt, impacting their growth and promotion opportunities. Previously, a few months’ work could lead to a managerial position in a new store. The slowdown in expansion meant prolonged periods without promotion opportunities. Our failure to effectively improve operational standards or provide adequate training further exacerbated the situation, leading to a decline in sales, morale, and team spirit.

Other departments also suffered, especially after a year of recruiting eager new employees ready to make their mark. The lack of opportunities for these employees to prove themselves led to a loss of direction and worsening internal atmosphere.

I was particularly frustrated, feeling responsible for the downturn and finding it hard to motivate the team. Doubts about the company’s future direction and personal growth opportunities began to surface internally. The slow pace of promotions and raises, compared to previous years, only added to the team’s demoralization and financial strain. It was during this precarious time that competitors began to poach our staff.

The most significant blow came when a promising Ningbo brand entered Henan, enticing one of our esteemed mid-level managers to leave. His departure, followed by a group of colleagues from the marketing operations department and a close associate from the franchising department, shook the company to its core.

It was later revealed that the successful poaching was not only due to our own low morale but also the attractive offer made by the competitor: a company car, stock options, and promises of dividends. After the two teams joined the competitor, they quickly launched aggressive marketing campaigns against us. Our franchisees nationwide received phone calls inviting them to switch allegiance. A few actually did change their signage, while others faced direct competition as the rival brand opened stores nearby, offering similar product ranges, targeting the same demographic, and engaging in vigorous promotional activities. This put our franchisees in a state of anxiety.

The battle even extended to slogans filled with provocation, aiming to undercut our lemonade sales with aggressive rhetoric. This new challenge caused further instability within our ranks; a small portion began to waver, while others worried about the company’s future. Many sought me out for reassurance, but I lacked the energy to address their concerns effectively. This only seemed to fuel the atmosphere of doubt, leading to more departures.

However, I wasn’t worried about the company’s fate. I believe that greater challenges only strengthen our resolve. I’ve never been convinced that attacking others can build a successful brand, nor do I believe that those who compromise their values in haste can achieve greatness. The competitor’s WeChat public account, filled with aggressive recruitment posts and exaggerated claims of success, raised doubts about their stability and integrity. My concern was not with the actions of others, but with our own path forward: when would we start to improve?

This period underscored the importance of resilience and the need to focus on our core values and operational excellence. The external pressure was a test of our team’s cohesion and commitment to our foundational principles. Despite the turbulence, the situation served as a catalyst for introspection and reaffirmed the necessity of maintaining a positive, forward-looking perspective amidst adversity.

4.2 Matcha, popular all over the world, originated from China

In 2016, despite the challenges and troubles we faced, the journey had to continue, and the meetings had to be held. So, on March 10th that spring, we convened the Second Annual Entrepreneurs’ Conference at the Henan Provincial People’s Hall. The theme was “Matcha of the World, Originating from China.”

After the launch of our matcha products in 2015, which saw lukewarm sales, my brother was not entirely pleased with my decision to have Sora Aoi endorse our matcha. Being a thorough individual, he conducted extensive research and concluded with a fact: Matcha did not originate in Japan but in China. Moreover, the largest current producer of matcha is not Japan but still China. He questioned why we should concede the standard of good matcha to Japan when it was a precious commodity of our own ancestors.

As early as the Sui and Tang dynasties, our ancestors consumed tea in its eaten form, matcha, which was later introduced to Japan during the Tang dynasty. There, it flourished and even developed into a unique Japanese tea ceremony. The Japanese love for matcha is profound, incorporating it not just in beverages but also in various foods and desserts. Today, the longevity of the Japanese people, which is among the highest in the world, might very well be linked to their frequent consumption of matcha.

In China, the method of tea consumption gradually shifted to brewing tea after the Song dynasty. However, this method extracts a relatively low amount of nutrients from the tea leaves, and a significant amount of fiber is wasted as tea dregs.

We decided to re-launch our previously underperforming matcha ice cream with a revised formula. At that conference, we invited 2,400 franchisees and store managers, each receiving two packs of matcha ice cream powder. Although we didn’t manage to make matcha widely popular thereafter, it undeniably laid the groundwork for its surge in popularity over the following two years.

The highlight of the meeting was my brother’s keynote speech, focusing on returning to the product and craftsmanship. The founder’s return always instills great confidence and motivation among everyone. He introduced the newly established R&D center and brought the R&D team members on stage. These young faces, mostly born in the 1990s, were introduced one by one, with my brother donning an apron, embodying the standard attire of a store employee. During the meet-and-greet, the youngest member, Li Da, made a memorable statement: “Some say we are awakened not by alarms, but by our dreams. I’d say, it’s not alarms that wake us; it’s because we never slept.” This paid homage to all the young contributors who had put their efforts into the Mixue platform.

My brother’s insight into business operations and future product line planning filled our franchisees with confidence and moved the suppliers and service providers present. With 2,400 people listening in silence, the hall was filled with hope for the future amidst the chilly spring air.

That meeting also marked the official unveiling of our new branding strategy, with Teacher Xiao Wei’s trendy and fashionable brand planning and upgrade earning continuous applause. It was there I first introduced the new head of our brand building department, Da Long.

Despite the pressures and troubles in my work, I couldn’t change my nature of boasting on stage about the next decade. Boasting is just the surface; it’s the unwavering confidence through the fog that really matters.

This was also the first time we invited an international supplier to speak. A representative from a Dutch company took the stage, elevating the excitement due to his impressive height and looks! Another big winner was LeTV; we awarded so many LeTV televisions it was as if they cost us nothing. The banners outside the venue were the result of several days and nights of hard work by our partners.

In summary, the conference was unprecedented in its grandeur, meeting our expectations with a sense of ceremony that was absolutely top-notch.

This encapsulates us: always living with joy and pain, highs and lows, self-doubt yet firmness, and flamboyance even in despondency.

From the launch of our lemon water in 2013 to 2016, we experienced three consecutive years without any new blockbuster hits. Upon my brother’s return to R&D, he led a tireless effort with a few development partners, and finally, our product range began to expand. However, this growth introduced a new set of challenges: previously, the dilemma had been a scarcity of noteworthy products versus an expanding store network. Now, the issue had shifted to the rapid turnover of new products versus the outdated operational capabilities of our stores.

Tensions frequently arose between the logistical support and the front-end operations, with both sides finding the situation unbearable. The R&D team, aware of the company’s lack of appealing products for consumers, worked day and night to launch new items. This necessitated marketing campaigns, updates to the store product mix manuals, and placed new demands on production for raw materials, leading to a situation where marketing efforts couldn’t penetrate deeply. Store kitchens had to update their recipe manuals twice a month or more, and factories faced new production challenges, leading to frequent errors.

Describing these issues now, I can do so rationally, but at the time, the clash between my front-end perspective and my brother’s back-end view was intense. Faced with various problems, it was difficult for me to calmly listen to their reasons and explanations, and it felt like we were on the brink of conflict once again. However, I want to outline the situation as it was then.

During his time away, my brother had visited many places. The more he saw, the more he realized the extent of our disadvantages compared to successful brands. Upon his return to R&D, his primary goal was to address our divergence from mainstream tea brands, not just in terms of products but across systemic issues as a whole.

He wanted to solve these problems thoroughly, taking the opportunity to lead the company through a complete transformation. Those in the front end who had grown accustomed to the previous pace experienced a sense of tear: distinguishing between two similarly named syrups, painstakingly preparing tapioca pearls, mastering various manual ingredient scooping techniques, and constantly adjusting to new operation and ratio tables, among other challenges.

The front end’s struggle was compounded by our network of 2,000 franchise stores. Originating from a grassroots brand, these stores were not founded on rigorous or systematic training. The franchisees, coming from a grassroots background themselves, hired staff who could be trained in a day or two, making everyone particularly accustomed to traditional, straightforward, and fast operational methods. The shift to more complex processes, akin to those of brands like Coco, was understandably overwhelming.

In this conflict, no one was at fault because the intention to improve gradually was positive. Yet, everyone bore some responsibility because each person viewed the issues from the perspective of their department or team. My mistake was not seeing the future trends of the tea chain industry or consumer demand as clearly as my brother did. I was too focused on our immediate disadvantages, thinking we couldn’t achieve more. This approach was short-sighted, focusing on the present without considering the future; it was an excuse for our lack of capability rather than an effort to understand and meet customer needs.

4.3 Youth is for fighting

As 2016 came to a close, looking back on the year felt like having ridden a roller coaster ten thousand times. It was precisely through the ups and downs of gains and losses that we forged a stronger resolve.

Having a dream to pursue, everything along the way becomes nourishment. “Merry Christmas, everyone has worked hard. In 10 years’ time, on Christmas, let’s share sweetness with at least one billion people, a nutritious sweetness,” I wrote in a WeChat message on Christmas 2016.

Then, in a blink, it was 2017. A younger entrepreneur once asked me how we managed to open over a thousand stores after he had been in business for two years. I told him earnestly that we spent the first ten years opening just one store. It took us 17 years to reach over a thousand stores, a result of stumbling through and accumulating experiences.

From 1997 to 2017, Mixue Bingcheng turned 20, marking two decades since my brother started his entrepreneurial journey. It had also been ten years since I opened the first franchise store in 2007. Just the decade I experienced was filled with so many events, witnessing the rise and fall of countless brands, from peers like Microphone, Four Seasons Flower, Typhoon Shelter, to Seven Cups Tea, to household names of a generation like Nokia and Xinfei Appliances. We too faced numerous near-death moments but managed to survive. Staying in the game is the most significant achievement.

By 2017, we had endured the pain of overexpansion and the wounds caused by halted growth. These experiences seemed predestined, and undergoing them was better than not. Encountering challenges earlier rather than later turned out to be beneficial, allowing us to take a more relaxed view of our development pace. In 2017, we decided to proceed at a moderate speed, with a normal mindset, just steadily moving forward.