On October 15, 2020, MINISO Group Holding Limited (“Famous Products”) was successfully listed on the New York Stock Exchange.
On March 31, 2022, Mingchuang Youpin submitted a prospectus to the Hong Kong Stock Exchange to apply for a dual-main listing of shares on the Hong Kong Main Board.
Mingchuang Youpin is a chain retail service provider with close prices. It was founded by Mr. Ye Guofu in Guangzhou, China in 2013 and has developed rapidly. In 2014, it had more than 300 stores and in 2015, it had more than 1,000 stores. As of December 31, 2021, Mingchuang Youpin has opened stores in about 100 countries and regions around the world, with more than 5,000 Mingchuang Youpin stores worldwide, including more than 3,100 Mingchuang Youpin stores in China and about 1,900 Mingchuang Youpin stores overseas. In China, this type of retail service provider also has a very people-friendly name “Shiyuandian”. Mr. Ye Guofu is also known as “Guangzhou Lao Ye” and “Shiyuandian Brother”.
Mingchuang Youpin is mainly engaged in two brands: flagship brand “Mingchuang Youpin” and trendy toy brand “TOP TOY”. According to Frost & Sullivan’s report, in 2021, the GMV of products sold online by Mingchuang Youpin stores will total about RMB 18 billion yuan, making it the world’s largest self-owned brand household comprehensive retailer. TOP TOY’s GMV reached 0.3744 billion yuan.
According to the prospectus of Mingchuang Youpin, the “Mingchuang Youpin” brand maintains a high frequency of new products and provides consumers with a wide product portfolio of more than 8,800 core SKU. Mingchuang Youpin products cover 11 major categories, including household, small electronic products, textiles, bag accessories, beauty tools, toys, makeup personal care, snacks, perfume, stationery and gifts. “TOP TOY” products are mostly IP hatched internally or jointly developed with independent design artists. As of December 31, 2021, “TOP TOY” brand products cover 8 major categories, including blind boxes, building blocks, hand-made, assembled models, collected dolls, a tour, sculptures and other fashion toys.
According to the prospectus of Mingchuang Youpin and International Financial Reporting Standards, in the past three fiscal years of fiscal year 2019, fiscal year 2020 and fiscal year 2021 (the annual deadline is June 30) and the first six months of fiscal year 2022 (June to December 2021), the operating income of Mingchuang Youpin was 9.395 billion, 8.979 billion, 9.072 billion and 5.427 billion yuan respectively, the corresponding net profits were -0.294 billion, -0.26 billion, -1.429 billion and 0.339 billion yuan respectively, turning a profit on the financial indicators in the second half of 2021.
Compared with the development of famous products, Mr. Ye Guofu’s family asset holding structure and control mode are also very worthy of attention. According to the prospectus and other public information of famous products, Mr. Ye Guofu, his spouse Ms. Yang Yunyun and founding partner Li Minxin have all set up family trusts to hold shares of famous products through family trusts and offshore company structures. The details are as follows:
In contrast to the common shareholding structure of family businesses, Mr. Ye Guofu and Mr. Yang Yunyun have set up their own family trusts, and Mr. Ye Guofu also holds about 16.59 per cent of the shares through the offshore company YGF MC Limited in addition to the trust.
In the family trust set up by Ye Guofu and Yang Yunyun, Ye Guofu is the establishment and protector of the family trust YGF Trust, controlled and through the trust by the trustee TMF(Cayman)Ltd. The representative holds a 26.79 per cent stake in the two-tier offshore company, which Yang Yunyun controls for the family trust YYYY Trust and through which the trustee TMF(Cayman)Ltd. The representative holds a 21.04 per cent stake in the two-tier offshore company.
From the author’s practical experience, the family trust set up by Ye Guofu and Yang Yunyun can at least assist the family in achieving the following wealth protection, management and inheritance purposes:
1. As a stable family wealth holding structure, the holding, management and control of its wealth can avoid the challenges brought by the changes of family internal relations and personnel situation (including emotional problems, marriage, behavior ability or inheritance events, etc.), and the stability of the structure is fully leapfrog, and its function can realize the leap of generations.
2, Ye Guofu and Yang Yunyun couple set up a family trust, the actual balance of the business, family and family members of the individual demands, the husband and wife have appropriate ownership, control, income rights and other protection.
3. Mingchuang Youpin belongs to a listed company in the United States and Hong Kong, and its assets belong to overseas assets. Holding assets through the structure of holding shares of family trust offshore companies can avoid a series of cross-border legal and tax problems between generations in the future.
4, the trust structure is responsible for the holding and reduction of the shares of the famous excellent products, with the change of the underlying assets, the family trust and its subordinate offshore companies can also be used as a platform for continuous investment management of family assets, for effective centralized management and control.
5. As a family trust holding objective assets, it will continue to serve as a security support platform for Ye Guofu and Yang Yunyun and their family members in the future, and will continue to support and protect their own and other beneficiaries’ lives, medical care, education, development, and individual diversified economic needs.
6. Other family purposes that can be achieved or supported under the trust arrangement.
Ye Guofu and Yang Yunyun started from scratch and have now become popular figures in China’s retail industry. Judging from their entrepreneurial history, they are learning and growing every step of the way. Today, if we look at the structural setting, business model, development plan and overseas dual listing arrangement of famous and excellent products, as well as the family wealth management ideas of their husband and wife, we can clearly see that they have the excellent qualities of many entrepreneurs in the Greater Bay Area. They are entrepreneurs who are both practical, landing and have foresight and in-depth thinking, and deserve admiration.
(Source: Family Generation)
