Xiaomi aims 10,000 stores targeting 50% business from retail shops

Xiaomi is aiming to have 10,000 retail stores in India as it is targeting 50 percent of its business to come from the offline route this year.
Xiaomi India businessXiaomi, which revolutionized the online sales — powered by e-commerce companies such as Amazon.com and Flipkart — is also launching a new retail format Mi Studio in India as it competes head-on with rival Samsung.

“About two years ago, we realised that while we had a 50 percent share in online sales, our offline presence was negligible. That’s when we started our offline expansion,” Xiaomi Vice-President and MD Manu Jain said.

The company has over 6,000 outlets across three formats – 75 Mi Homes experiential stores, Mi Preferred Partners retail stores and 1,000 Mi Stores in smaller towns, PTI reported.

“We aim to open over 10,000 retail stores across these four offline channels by end of year 2019. About 50 per cent of our smartphone sales is expected to come from the offline market by end of this year,” Manu Jain said.

Xiaomi is ahead of rival Samsung with 28.9 percent share of the smartphone volume in the December 2018 quarter. Samsung had 18.7 percent share with total shipment of 36.3 million units, the research firm IDC said.

Samsung has a strong presence in the offline retail market across India. Xiaomi is hopeful of maintaining its lead in India, given its aggressive stance on offline expansion.

A few Mi Homes are owned by Xiaomi and franchise-operated but the rest are under the franchise-owned and operated model. Mi Studios will be following the latter route. Xiaomi is working towards 200 Mi Studios by the end of 2019.

Mi Studios aim to offer premium brand experience in 50 top cities. “This format is an optimised version of Mi Homes replicating the same design and displaying modern minimalist interiors,” Jain said.

Xiaomi has set up the first two Mi Studios in Bengaluru and Mumbai, with an average size of 400-600 square feet.

Last year, Xiaomi said it will set up 5,000 Mi Stores across rural India by the end of 2019, a move that is expected to generate over 15,000 jobs.

Xiaomi earlier said its net profit more than tripled to 1.85 billion yuan or 275.59 million in Q4 2018. Revenue increased 27 percent to 44.4 billion yuan. Xiaomi revenue touched 174.9 billion yuan and net profit reached 8.6 billion yuan in 2018.

Xiaomi said sales from smartphones contributed 65.1 percent of Xiaomi’s revenue in Q4 2018, while other hardware generated 25.1 percent and internet services created 9.1 percent revenue.