Xiaomi targets 10bn yuan revenue from 1,000 new offline stores
Chinese smartphone maker Xiaomi has pinned its hopes on offline sales with a plan to open 1,000 brick-and-mortar stores over the next three years, targeting 10 billion yuan in revenue from this channel, its founder and chief executive Lei Jun said on Wednesday.
Xiaomi aims to boost the number of its physical stores, called Mi Home, to 200 this year from 51 at the end of last year, Lei said at a forum in Yabuli in the northeastern province of Heilongjiang.
“I am confident that each of the offline stores can achieve sales of 10 million yuan [per month],” he said. That means Mi Home retail stores are expected to contribute 2 billion yuan (HK$3.39 billion) in sales per month.
Lei said 2016 was a tough year for Xiaomi as he was “confused” about how to expand into more innovative sales channel from just e-commerce.
Traditionally, running brick-and-mortar stores will inflate costs and erode profits, making it hard to offer high quality and inexpensive products to customers, Lei said. The toughest part is therefore to build new stores with high efficiency to control costs, he said.
One of the challenges for Xiaomi is that we need to make essential adjustments after rapid growth
“Unlike other chain stores, Mi Home stores are all self-operated by Xiaomi. At the end of last year, our 51 stores were able to achieve sales per square metre of 260,000 yuan,” he said.
