By | Zhuang Shuai

The Häagen-Dazs logo is staying in China. The people running many of its stores, however, are about to change.

General Mills has agreed to transfer the mainland China store and gift business of its premium ice cream brand to a local investor consortium that includes Ningji, reflecting a broader trend of multinational consumer companies leaning on local partners to navigate a more competitive Chinese market.

On June 2, global food giant General Mills announced that it would sell Häagen-Dazs’ brick-and-mortar store business and gift business in Chinese mainland to an investor consortium that includes Ningji.What was being handed over were Häagen-Dazs’ company-owned and franchised offline stores, along with the holiday gift products sold in those stores—such as limited-edition festive ice-cream gift hampers.

The buyer was Ningji, a fresh-squeezed lemon tea brand that got its start on the streets of Changsha five years ago.

General Mills’ Light-asset Strategy

Many people might find this puzzling: Häagen-Dazs as a brand is clearly still doing fine—so why hand the stores over to someone else?

In fact, Häagen-Dazs has long been running two business lines in parallel in China.

The first is the one most familiar to the general public: its store business—those beautifully designed Häagen-Dazs dessert shops located in shopping malls.

This is a capital-intensive model that requires paying steep rents and bearing the pressure of staff wages and declining foot traffic.

According to store data displayed in Häagen-Dazs’ official mini-program as of the end of May 2026, Häagen-Dazs had more than 550 stores in China in 2019, but by the end of May 2026 only 171 remained—shrinking by nearly 70% in seven years.

The drop in foot traffic is the direct reason behind the contraction of its store network.

Based on internal data from General Mills and industry monitoring, foot traffic at Häagen-Dazs stores has posted double-digit percentage declines for multiple consecutive quarters. Revenue has been shrinking, while rent and labor costs are rigid—directly pushing a large number of stores into the red.

General Mills Chairman and CEO Jeff Harmening was also blunt on the earnings call, pointing to structural issues with the store model: declining foot traffic, high fixed costs, and low margins. By the end of 2025, a sizable share of directly operated stores were running on razor-thin profits—or even losses.

The other business line is retail, which has not only continued to grow but also delivers strong profitability.

Retail here does not mean ice cream sold to customers inside the stores. It refers to packaged products sold through offline supermarkets and convenience stores; e-commerce platforms such as Tmall and JD.com; and instant retail channels such as Meituan and Taobao Flash Sales. These products follow a light-asset FMCG playbook, relying on General Mills’ global supply chain and distribution capabilities. There is no need to open and operate stores, operating costs are far lower, and margins are actually better.

According to multiple media reports, from June 2025 to April 2026, the Häagen-Dazs brand in China achieved dual growth in retail-channel sales performance and market share. In offline modern trade channels tracked by NielsenIQ, it also posted high double-digit sales growth.

Executives in General Mills’ international division had previously disclosed that, excluding the drag from the store business, the company’s net sales in China actually recorded positive growth.

It should be noted that General Mills’ financial reports do not separately disclose the respective profit margins of its mainland China store business and its retail business, and it is difficult for external analysts to precisely split costs and profits between the two.

However, judging from the data above and executives’ public remarks, it has become an industry consensus—corroborated from multiple angles—that the store business is significantly less profitable than the retail business.

So what General Mills did was a shrewd carve-out.

They carved out the store business—high costs, thin margins, and the daily grind of fighting local rivals for foot traffic and storefront locations—and handed it off to Ningji, which understands the China market better. Meanwhile, they kept the higher-margin retail and foodservice business firmly in their own hands—more standardized, more scalable, and better suited to a global supply chain. That is the fundamental reason General Mills was willing to let go of the stores, but not the retail business.

For General Mills, the math behind this deal was straightforward: ditch the burden, keep the cash cow.

Ningji’s Ambition and Anxiety

Why would a brand that sells hand-squeezed lemon tea suddenly take over a network of premium ice cream stores?

First, look at where Ningji stood.

The brand got its start in Changsha in 2021. Riding a differentiated positioning and an internet-driven playbook, it opened more than 3,000 stores in three years and secured investment from ByteDance, Shunwei Capital, and Tencent. But by May 2026, the number of operating stores had fallen back to 1,799—far from the 5,000-store target it once touted—and its most recent funding round remained stuck in early 2022.

A single category has a ceiling; franchise growth was losing steam; and as capital cooled, Ningji needed a new narrative and a new growth curve.

Taking over Häagen-Dazs stores happened to fill three of the things it lacked most.

First: storefronts in core prime commercial districts.

Most of Ningji’s stores are located along streets, in residential communities, or in lower-tier retail districts, which makes it hard for the brand to secure ground-floor space in prime malls in top-tier cities. The 200+ stores left behind by Häagen-Dazs, however, are precisely in core locations in cities such as Beijing, Shanghai, Guangzhou, and Chengdu. Through this partnership, Ningji has essentially obtained a fast-track pass into these coveted “golden” storefronts.

Second is brand value.

Ningji’s average spend per customer is RMB 15 to 25, putting it firmly in the affordable range. Häagen-Dazs, by contrast, is a premium brand with a history of more than 60 years, with average spend per customer above RMB 50. Operating the two brands together allows Ningji to move upmarket and reach a higher-quality customer base, while also giving its own brand image a lift by association.

Third is the expansion of its product portfolio.

Combining tea beverages with ice cream has already become a major industry trend—Heytea and CHAGEE are both doing it. For Ningji, it would be very difficult to build a premium ice cream line from scratch relying solely on its own R&D. But Häagen-Dazs brings a ready-made product system and proven formulas, which is far faster than Ningji developing everything in-house.

Looking further ahead, Ningji’s founder has long talked about an “N-brand strategy,” aiming to build a beverage management group rather than remaining just a lemon-tea business.

Securing Häagen-Dazs is the most critical move under that strategy.

Challenges and Opportunities 

It sounds appealing, but taking over a business with an aging brand and a shrinking store footprint is no small challenge. Ningji will have to contend with three major hurdles: brand positioning clashes, supply-chain coordination, and external competition.

The first key tension is the clash in brand positioning.

Häagen-Dazs’s core asset is its premium image. From its founding in 1961, to its acquisition by Pillsbury in 1983, and then being brought under General Mills together with Pillsbury in 2001, what it built in consumers’ minds worldwide was always an upscale, refined brand—one that feels right for gifting and for dates.

Lemonji, by contrast, is built on being affordable, high-frequency, and internet-native. If Lemonji were to apply its playbook to Häagen-Dazs wholesale—say, slashing prices, running constant promotions, or doing a string of influencer co-branded launches—it could dilute the most valuable thing Häagen-Dazs has: its brand premium. But if it simply sticks with the old model, it won’t address the root cause of store losses either.

There’s also a very practical challenge: the supply chain.

At present, most ingredients used in Häagen-Dazs stores still rely on imports. If Lemonji switches to local suppliers to cut costs, can it maintain the same taste and quality? That’s a major uncertainty.

On top of that, because General Mills still retains Häagen-Dazs’s retail business, this means the same brand is being run in two places: supermarket shelves sell boxed ice cream operated by General Mills, while specialty stores sell made-to-order ice cream operated by Lemonji.

Two systems, two teams, two operating logics—how do you ensure prices don’t undercut each other and brand positioning doesn’t clash? From a brand-management standpoint, that’s an extremely difficult coordination task.

External competition also leaves little room to catch one’s breath.

China’s ice cream market had already reached RMB 210 billion in 2025, and it was still growing at more than 5% per year.

But the main driver of that growth wasn’t premium-priced ice cream.

According to data from “Mashangying,” an offline FMCG retail tracking agency, from May to June in 2023 through 2025, ice cream in the RMB 3–5 price band ranked No. 1 in sales volume for three consecutive years, with sales-value shares of 45.41%, 44.92%, and 45.97%, respectively; meanwhile, the sales-value share of higher-priced products above RMB 12 declined year by year, from 5.99% in 2023 to 3.95% in 2025.

Häagen-Dazs sits squarely in that squeezed premium segment. It isn’t as cheap as Mixue Bingcheng—cheap enough to buy without thinking—nor does it have the novelty and handcrafted feel of some emerging Italian-style gelato brands. Being caught in the middle is the most dangerous position.

Of course, opportunities exist at the same time.

What Lemonji does well is digital operations, converting delivery-platform traffic, and social-media ad placement—precisely the areas where Häagen-Dazs historically hasn’t performed strongly enough. If integration is handled well, we may see Häagen-Dazs stores become smaller and lighter—shifting from dine-in heavy formats to primarily takeout and ready-to-eat; the product line expanding from pure ice cream to blended ice-beverage formats; and the membership program becoming more active, rather than only coming to mind once a year when it sells mooncakes for Mid-Autumn Festival.

Not Merely a Change of Hands

Zoom out a bit, and this deal is not simply the transfer of a brand; it signals a shift in how Chinese and foreign consumer brands work together.

Over the past two decades, the standard playbook for multinationals entering China was end-to-end control—brand, capital, and management all in one.

In recent years, Starbucks sold a majority stake in its China business to Boyu Capital; McDonald’s China brought in CITIC and Carlyle; and DQ was also looking for local partners. Collectively, foreign giants were doing the same thing: retreating to the brand and supply chain, and handing over store operations—where heavy-duty localization is required.

Ningji’s partnership with Häagen-Dazs goes a step further than the cases above: it isn’t an equity deal, but a brand licensing arrangement. General Mills still owns the Häagen-Dazs brand; it has simply granted Ningji exclusive operating rights for the China store business. It’s a lighter, more flexible model—but it also demands a higher level of trust and coordination from both sides.

Experience shows that arrangements like this—where the brand owner and the operator are separate—have often failed due to clashes over interests and philosophy. Ultimately, whether this deal succeeds or not will be judged by what Ningji delivers next. Whatever the outcome, one thing is becoming increasingly clear: in China’s retail and consumer market, the leading players are changing.

Multinational giants are no longer the hands-on operators determined to control everything; instead, they are shifting toward an enabling role behind the scenes. Local brands, too, are no longer mere followers—they are stepping into the spotlight, taking over the stores of marquee names, and reinterpreting these familiar brands in their own way.