Xiaomi bets on switch to physical retail

Xiaomi pioneered an online flash-sales model that lifted it to dizzying heights and made it Asia’s most valuable startup, but it’s since fallen on hard times. Now it’s counting on old-fashioned retail to make a comeback, and that’s proving a much stiffer challenge, according to Bloomberg. The smartphone maker is going through a major transformation after missed targets prompted a bout of soul-searching by billionaire co-founder Lei Jun. From Harbin in the chilly northeast to glitzy eastern Shanghai, it aims to build 1,000 “Mi Homes” by 2019, about twice Apple’s global store count. Xiaomi, which has no real track record running stores or armies of sales reps, wants to set an upmarket tone for its brand by building its own signature outlets. But it’s taking on surging rental and labor costs, while rivals Huawei, Oppo and Vivo have sewn up prime locations by striking deals with hundreds of thousands of resellers.