Beware Tianlala: Valuable Lessons from Mixue's Failure

Over the last three years, the market for tea-based beverages and desserts in Indonesia has been enlivened once again by the presence of Tianlala, which has expanded rapidly across various cities. The market’s enthusiasm for this brand is evident from the swift opening of new outlets and high consumer interest, particularly among young people and the urban middle class. However, this phenomenon has also raised concerns that cannot be ignored. The public still remembers how Mixue, which previously experienced very aggressive growth, is now facing market realities in the form of the closure of several outlets due to overexpansion and saturation. This situation serves as an important mirror for Tianlala, that rapid growth is not a guarantee of sustainability. From the perspective of modern business strategy, this phenomenon can be explained through the concept of premature scaling, as written by Tom Eisenmann in the book Why Startups Fail: A New Roadmap for Entrepreneurial Success (2021). Many companies fail not because they lack a market, but because they grow too quickly before their business model is truly mature. Early expansion often overlooks in-depth validation of economic indicators, operational efficiency, and consistency of customer experience. In the context of Tianlala, this risk will emerge when outlets are opened en masse without ensuring that each one can achieve healthy and sustainable profitability. In the highly competitive contemporary beverage industry, differentiation is the key factor. If Tianlala only relies on competitive pricing or follows viral flavour trends, those advantages will be easily imitated by competitors. Without a strong and unique positioning, the business will be trapped in price wars or a red ocean, ultimately eroding profit margins and weakening financial foundations. Additionally, financial management often becomes a weak point in aggressive expansion. Opening new outlets requires significant investment, from location rental costs and operations to human resources. If expansion is not accompanied by strong cash flow planning, financial pressure will increase, especially when outlet performance does not meet expectations.