Future Franchisee Selection:

1. Specify selection criteria that MINISO should prioritize in selecting future franchisees. Note the risk factors identified in Appendix 5.

2. Discuss how using these criteria can help MINISO avoid the difficulties it has experienced in countries like Australia, Canada, Germany, South Africa, and other locations. See Appendix 3 for details.

Appendix 3: Excerpts from Nikkei Asia article Source: Tan, CK. Chinese retailer Miniso shows strains in dash for global growth. Nikkei Asia. November 27, 2020. With 2,533 stores already open across China as of June, Guangzhou-based Miniso Group is counting on foreign markets to help drive future growth for its brightly lit stores which offer an eclectic range of discretionary goods from cartoon-character neck pillows to earphones and notebooks. Miniso, which is backed by Chinese internet company Tencent Holdings, has entered 80 overseas markets since venturing into Hong Kong in 2014, a year after its founding, but aims to reach 100 on the way toward raising chainwide annual sales to 100 billion yuan ($15.2 billion) by 2022. Miniso hailed its upcoming entry into Italy and Iceland and noted a flurry of openings in Spain had helped bring the total number of new store launches since the IPO to 100. Analyst Oshadhi Kumarasiri with LightStream Research in Colombo thinks Miniso can find plenty more customers like Tan. "We believe there is long-term growth potential in overseas markets through store count growth in existing geographies as well as through expansion to new countries," he wrote in a note published on Smartkarma. "The company has already proven that it is capable of profitably expanding into 80 countries across various continents," Kumarasiri said. "Furthermore, the business model used in overseas expansion is easily scalable and the company's efficient supply chain provides competitive pricing, even in overseas territories." Local press reports from South Africa, where Miniso had 19 shops, tell of store operators unable to keep their shelves filled with requested goods starting from late 2018. Store owners took Miniso to court but it ultimately sold off its South African business, along with its operations in Nigeria, Uganda and Tanzania, to Ye Guofu, Miniso's chairman and chief executive, earlier this year for the nominal sum of 7 yuan, according to the company's IPO prospectus. Its Kenyan business was sold to another buyer for 1 yuan. After disputes with its Canadian affiliate, Miniso successfully petitioned a judge there to put the unit into court-supervised restructuring last year at a time it had 48 stores in operation. In its prospectus, Miniso said its Canadian distributor "engaged in fraudulent activities and caused harm to our reputation, our business and results of operations." A group of franchisees were reported to have filed suit against the company this year. The nature of Miniso's troubles in Germany is unclear. After arriving in Berlin in 2017, new Minisos were still opening as recently as last December but by this past June, all were having closing sales or shuttered. The German business was included in the 7-yuan sale to Ye.

Appendix 5

Appendix 5: Risk Factor Excerpts from MINISOs SEC Form F-1 (originally filed Sept. 23, 2020).

Any of the following risks could have a material adverse effect on our business, financial condition and results of operations.

We primarily rely on our retail partners and distributors to expand our store network. If we are unable to expand our store network successfully, our business, results of operations would be adversely affected.

We plan to expand our store network both domestically and internationally and we primarily rely on our MINISO Retail Partners and local distributors to realize such expansion. However, we may not be able to expand our store network as we planned. The number and timing of the stores actually opened during any given period are subject to a number of risks and uncertainties. For example, we may not be able to identify MINISO Retail Partners and local distributors with sufficient resources and strong local ties to collaborate with us. If our MINISO Retail Partners and local distributors fail to operate MINISO stores successfully for whatever reasons, they may not be willing or able to renew their agreements with us. As a result, the number of MINISO stores in our store network will decrease, which would negatively affect our store expansion plan.

If we, our MINISO Retail Partners or local distributors fail to successfully operate MINISO stores, our business and results of operations would be adversely affected.

As of June 30, 2020, over 90% of MINISO stores in our global network were established and operated by our MINISO Retail Partners and local distributors. Therefore, successful operations of MINISO stores by our MINISO Retail Partners and local distributors directly affect our results of operations. However, our MINISO Retail Partners and local distributors are independent from us and we cannot control many factors that impact the profitability of their