Thu. Oct 6th, 2022
Xiaomi stores close in France: behind the scenes of a fiasco


6 of the 7 Xiaomi stores still in operation in France have suddenly closed. It was an activity under franchise, but the manager was under receivership. explanations.

When it arrived in France in 2018, the Chinese brand Xiaomi was very ambitious. New entrants typically start small, partnering with well-established resellers. Xiaomi had the nerve to open physical stores from its first day on French territory, when no one knew about it. It was in Paris, boulevard de Sébastopol, that the first Mi Store was born, before being followed by several establishments (some even had time to close). A strategy identical to that of other European countries, which have also seen Xiaomi arrive from nowhere, with stores on the main streets.

Xiaomi has always considered its strategy a masterstroke, which immediately placed it at Apple’s level from the point of view of visibility (its stores, moreover, were inspired by those of the Californian). However, there is an important difference between Apple Stores and Mi Stores: the first belong to Apple, the others are franchises and do not commit Xiaomi in anything. Like our colleagues from phoneandroid, 6 of the 7 stores still in business in 2022 just suddenly closed. We spoke to several employees, all waiting to be fired.

Xiaomi Shutdown
The mysterious message published in the accounts of the stores on the day of closing. // Font : instagram

Two managers, one syndicate

What happened ? Unfortunately, our information on the subject remains incomplete, due to phone numbers ringing in the dark or people who do not want to express themselves on the subject. However, little by little we are beginning to understand what happened.

In 2018, Xiaomi partnered with iHealth Labs Europe. The proof: all the emails or receipts published by the Mi Store boutiques were signed by the company, which presented itself as the “Xiaomi France Official Partner for Mi Stores”. iHealth Labs Europe had also allowed itself some liberties that Xiaomi did not like, such as offering refunds against paid subscriptions or selling some of its own products on Mi Stores. The ties between the two companies have never been very strong, gradually leading to a divorce in January 2021.

Tell me Xiaomi
Since February 2021, Tell Me sign Xiaomi Store communication. // Source: Numerama screenshot

What happened at that time is quite complicated to explain. If we have understood correctly, iHealth Labs Europe has been left with only one store: the one on the Champs-Élysées (the one that does not close). The rest of his business was sold to Tell Me, a new company created for the occasion. Since February 2021, Tell Me started to sign the store newsletter. We haven’t been able to reach its managers, but multiple sources tell us it was founded by former Mi Store employees who didn’t want to see their stores go under because of iHealth. This young shoot has therefore taken over the activity of the Xiaomi Store in France, still under franchise.

A year and a half later, in July 2022, Tell Me has been placed in suspension of payments. In its sentence, the company explains that it is in litigation with iHealth, that it is demanding money from it (and that it should have paid the rent). One would have thought that Xiaomi France, which is doing well in France, would resume activity, but no buyer has come forward. As a result, Tell Me suddenly closed six of its seven stores and placed affected employees on financial layoff.

The end of Xiaomi stores?

It is not the first time that a Xiaomi store has closed in France, confirming that the franchise model for a high-tech brand is not easy to set up. In Opéra (Paris), another company that iHealth also tried in the Mi Store, before giving up. We had been informed of the existence of tensions around the existence of this competing store, without knowing its nature.

Is Xiaomi’s physical model doomed to disappear? Not necessarily, because the stores can always be busy. We are particularly surprised by this announcement that by early summer the Sebastopol boutique had been completely renovated. It seems that everything happened very quickly, and even the employees did not expect this fate.

Contacted, Xiaomi France explains to us that it has “ taking note of the decision of the Court of Justice of Créteil, which places the Tell Me company, administrator of the Xiaomi Store in France, in forced liquidation, Xiaomi is working to quickly resume its normal activities “. It remains to be seen what Xiaomi calls “normal activities”and whether stores will ever reopen.

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This article was translated from this source written by

By SABER

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