Dave Smith
5 min read
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It may surprise you to learn that the world’s largest fast-food chain isn’t an American staple like McDonald’s or Starbucks. It’s actually Mixue, an ice cream and boba shop founded in 1997 that has exploded in popularity in China and throughout Asia. Zhang Hongchao was a university student when he created the first Mixue stall; now he’s a billionaire.
McDonald’s was founded 85 years ago in San Bernardino, Calif. It’s the world’s second-largest private employer—behind only Walmart, No. 1 on the Fortune 500 again this year—and has over 40,000 locations worldwide.
Yet, McDonald’s still falls behind one company in terms of footprint: Mixue Ice Cream & Tea.
Mixue, as of March, is currently the world’s largest fast-food chain by store locations, with over 46,000 sites across Asia, Australia, the Middle East, and South America. Roughly 40,000 of its total locations exist in mainland China, meaning the company has even more room to run globally. And the company’s performed well since its March debut on Hong Kong’s stock exchange, soaring from its opening price of $290 HKD per share to $584.50 HKD as of Monday morning.
Zhang Hongchao probably didn’t expect to be the founder of such a behemoth when he opened his first street-food stall 28 years ago.
Zhang was attending the Henan University of Economics and Law when he had the idea to open a food stall, mainly to sell beverages like cold drinks and shaved ice. He asked his grandmother to borrow 3,000 yuan—around $362 back then, or $417 today—to open up a small stall on the streets of Zhengzhou, the capital of China’s Henan province and a major international transport hub.
The stall was successful, even early on. According to a lengthy profile about Mixue in China’s state-run outlet Sina News, Zhang was able to sell products worth up to 1.5 yuan for more than 100 yuan; in other words, he could make a drink that cost around 21 cents and sell it for more than $14.
Unfortunately, Zhang’s inexperience, and the rapid modernization of Zhengzhou, would become obstacles. The villages of Zhengzhou were constantly subject to demolition efforts as the area grew more urban, which resulted in Zhang’s store getting demolished three times in a single year, according to Sina News. And he learned the hard way how difficult it is to sell cold treats during the winter season, which forced him to sell mandarin oranges for extra cash.
Despite the setbacks, Zhang kept at it. He bought more machines, added more sugary drinks to his menu, and notably introduced a soft-serve ice cream cone for just 1 yuan, or roughly 14 cents, which solidified the brand among budget-conscious consumers.
