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Make room Starbucks and McDonald's. China's Mixue and other brands win fans in Southeast Asia

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HONG KONG (AP) — Chinese food and beverage brands are gaining ground across Southeast Asia, offering alternatives to big name American chains and expanding Beijing’s commercial and cultural influence in neighboring economies.

The Chinese beverage giant Mixue Group has become the world’s largest F&B chain by number of outlets, overtaking Starbucks and McDonald’s.

The company, whose brand name Mixue Bingcheng means “Honey Snow Ice City,” in Chinese, is capitalizing on the region-wide sweet tooth with affordable offerings of ice cream, coffee and bubble tea drinks.

“Even on social media like TikTok and others, there is a joke that any empty shophouse would soon turn into a Mixue store,” Rahma Yuliana said, referring to a popular saying in Indonesia, where Mixue has more than 2,600 outlets.

The single mother, who runs an online business, takes her daughter for afterschool treats that won't drain her wallet, such as a cup of brown sugar milk tea that costs $1.10, about one-third cheaper than similar offerings by rival Taiwanese tea chain Chatime. An ice cream sells for as little as 50 cents, undercutting McDonald’s.

As of September, Mixue Group had over 45,000 stores carrying its Mixue tea drinks, ice creams and Lucky Cup coffee products, more than the store numbers of Starbucks and McDonald’s, industry analysts reported. About 40,000 of those are in China.

More broadly, by December, Chinese F&B brands had opened over 6,100 outlets in Southeast Asia, Singapore-headquartered research firm Momentum Works reported. India and Vietnam account for roughly two-thirds, while there are relatively more Chinese brands in Singapore and Malaysia, which have sizable Chinese-speaking populations.

Nearly all of Mixue's stores are franchises that the company supplies with ingredients for drinks like Creamy Mango Boba, Mango Oats Jasmine Tea and Coconut Jelly Milk Tea.

Apart from Mixue, other market stars include hotpot giant Haidilao, Fish With You sauerkraut fish restaurants, and well-known beverage brands such as Luckin Coffee, Heytea and Chagee.

Mixue's shares have doubled from their IPO price since their March 3 trading debut in Hong Kong.

Momentum Works CEO Jianggan Li said Chinese businesses are actively seeking new growth in Southeast Asia after facing fierce competition in their home market.

The push by food and drink retailers has raised awareness that China has more to offer than just cheap electronics.

The companies are well-equipped, using automation to enhance their efficiency, and adept at online marketing, Li said. Big Western brands sometimes take a long time to find local partners and develop long-term plans. The Chinese F&B companies are “much more impatient," he said.