How Mixue used Art of War to Be No. 1 in the World

As of today (Nov 2025), in terms of store count, Mixue has 45,000 worldwide, exceeding 43,000 of McDonald's. Mixue Snow Ice City is a public-listed company in Hong Kong (not listed in China).  Its financials shows that it is a highly profitable business with 12% net profit margin.  It operates on a franchise model with low franchise fees, and zero percentage of sales. 

So, how does Mixue make money?
Their primary revenue stream is selling supplies to their franchisees. A franchisee is contractually obligated to purchase nearly everything, including ingredients (syrups, tea bases, powders), cups, straws, and even equipment, directly from Mixue. This is a brilliant and highly effective model that aligns their success with the franchisee's success, as they profit from the volume of goods sold, not from the store's top-line sales.

Therefore, while they don't charge a "percentage of sales," they capture their profit further down the supply chain.  This is the Art of War top strategy: Take the Entire Nation. 

How Mixue Ice Cream & Tea Won Without Fighting

“The skillful fighter subdues the enemy without fighting.” — Sun Tzu, Chapter 3

1. Sun Tzu Strategy #1 — “Win Through Terrain and Speed”

“He who occupies the field of battle first and awaits the enemy will be at ease.” — Art of War Ch. 6

What Mixue did:

• Focused not on Tier-1 cities (Beijing, Shanghai) where McDonald’s and Starbucks dominate, but on Tier-3, Tier-4, and even rural towns — the “empty terrain.”

• Low-cost, high-volume model made them unbeatable in smaller markets where Western chains couldn’t profit.

• Lightning-fast franchising: standardized ingredients, simple menu, small shop footprint → thousands of outlets launched each year.

Art of War principle: “Attack the enemy where he is unprepared, appear where you are not expected.”
By expanding in unseen terrains, Mixue conquered territory others ignored — “winning without fighting.”

2. Sun Tzu Strategy #2 — “Formless Strategy: Adapt Like Water”

“Water shapes its course according to the nature of the ground.”

Execution:

• Adapted product mix to local tastes — in northern China, more hot drinks; in southern China, more cold desserts.

• Allowed micro-customization for franchisees (regional toppings, price flexibility).

• Avoided rigid hierarchy — agile regional teams empowered to make quick local decisions.

🧩 Result:
While McDonald’s enforces global uniformity, Mixue flows like water, adapting form while preserving brand essence.

3. Sun Tzu Strategy #3 — “Win First, Then Fight” (Prepare Before Expansion)

“Victorious warriors win first and then go to war.”

Mixue prepared by:

• Controlling its entire supply chain — from sugar and milk factories to packaging and logistics.

• Built an in-house R&D center and training university before international expansion.

This meant when global brands faced cost spikes, Mixue already had victory secured through vertical integration.

4. Sun Tzu Strategy #4 — “Use Both Direct and Indirect Strategies”

“There are not more than two methods of attack — the direct and the indirect; yet their combinations are limitless.”

Direct: affordable pricing (¥6–10 per drink).
Indirect: cultural appeal through viral “Mixue Snow King” mascot and songs.

Instead of competing on Western “luxury lifestyle,” Mixue won hearts through cute simplicity and national pride.

5. Sun Tzu Strategy #5 — “Moral Law (Dao) Before Profit”

“The Moral Law causes the people to be in complete accord with their ruler.”

Mixue’s Dao = “Good products for everyone.”
Its mission to make ice cream and milk tea affordable for all created emotional resonance across China and Asia.

Employees and franchisees align with that Dao — making it a moral, not just a commercial, empire.