Japanese Brands Can Grow Without Japanese Operators: Retail Expansion Models from Daiso and MUJI in the Middle East
In Dubai, Japanese restaurants run without Japanese staff are thriving. Ingredients are imported from Japan, while operations are led by local and Asian-trained teams. It is a welcome sign that Japanese culture has taken root. The same pattern appears in retail: Japanese brands that succeed in the Middle East partner with strong local operators and expand without Japanese personnel on site. This article sets out the models behind that.
Footprint in the Middle East
Daiso operates 1,107 stores overseas across 25 countries and regions (end-February 2026). MUJI operates 757 overseas stores across 27 countries and regions (end-August 2025). Their Middle East footprint is as follows.
| Brand | Operating model | Stores in the Middle East | As of |
|---|---|---|---|
| Daiso | Franchise (Lals Group / Damas Group, as of the 2018 announcement) | 93 stores in 6 countries UAE 51, Saudi Arabia 14, Qatar 12, Kuwait 8, Bahrain 4, Oman 4 |
End-Feb 2026 |
| MUJI | Exclusive franchise / licence agreement (Alshaya Group) | 18 stores in 5 countries UAE 8, Kuwait 3, Saudi Arabia 3, Bahrain 2, Qatar 2 |
End-Aug 2025 |
| MINISO | Country-level operating companies (distributors appear to predominate) | Middle East store count not disclosed (3,583 overseas in total) |
End-Dec 2025 |
Sources: official announcements by Daiso Industries, Ryohin Keikaku and MINISO Group. Fiscal year-ends differ, so the date is shown for each.
Both Rely on One Strong Local Partner per Market
Neither brand has set up its own operating entity in the Middle East. Both entrust each country to a leading local partner, and operations are run by the partner companies' own management teams.
What Makes It Work Without Japanese Operators
This does not make the Japanese side redundant. The Japanese side keeps supplying products, the brand and operating standards. The partner contributes mall space, logistics, people and a membership base. It is the same structure as a Japanese restaurant in Dubai that keeps importing its ingredients from Japan.
The value Japan provides has shifted from sending people to supplying products and brand. Even without Japanese staff on site, headquarters' products and brand support remain essential.
If you would like to assess what this means for your brand and which model fits, please contact us. Drawing on our support for more than 200 companies, we will advise on your specific situation.
MUJI's Lesson: Partner Selection Decides the Outcome
In the 1990s, MUJI struggled to retain control in London (partnering with Liberty) and in Hong Kong (a joint venture with Wing On), and withdrew from Asia in 1998. It then changed course.
- 1Partner only on terms that let MUJI lead (51% or more ownership, or a subsidiary)
- 2Confirm that each store is profitable before opening the next
- 3Negotiate sites and rents directly
MUJI re-entered Hong Kong on its own in 2001, which later led to its expansion in mainland China. Even when a franchise model is chosen in the Middle East, the contract must keep the Japanese side's approval rights over brand standards, assortment and pricing.
MINISO as a Benchmark
MINISO is headquartered in Guangzhou, China, and began with Japanese-style branding. It has stated that it would remove Japanese elements from 2022 onward. It is best viewed not as an example of a Japanese brand, but as a benchmark for how a retail model can scale.
- Scale: 8,485 stores at end-December 2025, of which 3,583 are overseas.
- Overseas operating models: Roughly 68% (2,451 stores) are run by distributors, local sales agents that take title to the goods and bear inventory risk. 700 stores are directly operated and 432 are run by Retail Partners (franchisees).
- Switching: MINISO divides overseas markets into "directly operated" and "distributor" markets, and reclassifies countries as the business matures.
- Middle East: Operators differ by country, for example Ali Ahmed Algabas Trading Est. in Saudi Arabia and BTC Fashion in Qatar. A country-by-country operator model appears to predominate in the Middle East as well.
Unlike Daiso and MUJI, MINISO flexibly switches between direct operation and distributors as a market matures.
Which Model Fits Your Brand?
The right model depends on your unit price, product turnover and how you intend to protect the brand. The Middle East examples point to four models.
| Model | Examples | Best suited for | Key contract and operating points |
|---|---|---|---|
| Exclusive franchise (one partner per country) |
Daiso with Lals / Damas; MUJI with Alshaya | Brands that cannot commit people and capital in the Middle East; mall-based retail | Country-level territory, minimum store commitments, approval rights over brand standards |
| Distributor / product supply | MINISO overseas (about two-thirds); MUJI licensed stores | Brands with strong manufacturing and sourcing that want to test demand first | Prohibition on price deviation, no sub-contracting, non-compete |
| Direct operation with local talent (with the option to switch later) |
MUJI in Hong Kong and China; MINISO directly operated stores (700 overseas) | Brands seeking long-term profit capture and strict control of brand experience | Ownership share, store-by-store profitability, sites and rents negotiated directly |
| Broad franchisee network | MINISO in mainland China (Retail Partner model) | Standardised formats that can be replicated as small stores at scale | No example confirmed in the Middle East |
Consider keeping, in the contract, the option to move from franchise to direct operation or a joint venture in markets that prove successful.
Sources (date): Daiso Industries, Global Store Network (end-Feb 2026) / Daiso Japan press release (Jan 2018) / Ryohin Keikaku Corporate Profile (end-Aug 2025) / M.H. Alshaya announcement (Jan 2013) / MINISO Group results release (31 Mar 2026)
Most Japanese brands that succeed in the Middle East entrust operations to a strong local partner under a franchise model. Daiso operates 93 stores across six GCC countries and MUJI 18 across five. The value Japan provides has shifted from sending people to supplying products and brand, provided the contract keeps control in Japanese hands. Which model fits depends on your unit price, product turnover and how you intend to protect the brand.