Beginning in the second half of this year, layoffs, shutting down the city, defaulting on payment, etc. have become keywords for the old players in community group buying. After Tongcheng Life declared bankruptcy, Shihui Group, which is also one of the “oldest three groups”, seemed to have embarked on the same path as it.
A few days ago, some media reported that the Shihui Mission might close all grid warehouses in Hunan in the next two to three weeks, and it is expected to close all its operations in Changsha City, its base camp by the end of the year.
In response to this, the Shihui Group responded to the media saying that the Hunan region is indeed making business adjustments, but this is a normal survival of the fittest, and there is no complete shutdown.
However, some of its suppliers and some former employees revealed to the “Finance World” Weekly that Shihui Group is also facing the situation that suppliers have come to “debt collection” one after another, and several employees have been “violently laid off” by the company.
“I just arrived at the company in the morning and was notified of my dismissal in the afternoon. I was also forced to sign a voluntary resignation agreement. 80% of my salary in November was not paid.” A former Shihui group employee told Caijing Tianxia angrily. weekly. Some employees said that the layoffs of the Shihui Group have been ongoing. The company’s initial staff of tens of thousands of people has now been reduced to less than 1,000 people.
As early as August this year, there was news that the Shihui Group began to withdraw from cities and lay off workers on a large scale, shutting down the business in 21 city circles across the country, leaving only the 5 core metropolitan areas with profitability. More than a month ago, a former Shihui Group employee also told the “Financial World” weekly that Shihui Group is trying to survive and is waiting for “life-saving money”-it is said that it may usher in January 2022 A capital injection.
However, before the money was in place, the severe winter of the Shihui Mission was sad.
Angry employees and suppliers
In December, many Shihui group employees received a sudden resignation agreement. This makes them very angry.
In early June 2021, Xiao Zhang, who has just joined the Shihui Group, is responsible for managing product scheduling in the Commodity Department of Jinan City Circle. Xiao Zhang told Caijing World Weekly that on December 17, when he went to work at the company, as usual, the head of the department told him: “The 20th company will lay off employees.”
On December 20, Xiao Zhang came to the company. He found that even HR had applied for resignation and was no longer in the company. He said that afterward, he received an electronically signed resignation agreement from the company, which forced the employees to sign.
“If we sign, according to this agreement, we resigned due to personal reasons, and the December salary will be delayed until February of the following year. But the company said that if we don’t sign, we won’t get the November salary.” Xiao Zhang said that most employees, including him, refused to sign this resignation agreement. Immediately, these employees were kicked out of the company’s nail group.
He told the “Finance World” weekly that the company’s current practices “make employees very angry.” Combined with the changes in the company’s performance this year, in his view, this is “step by step disintegration of our employees’ trust in the company. The business of the Jinan city circle has been abandoned by the company.”
Xiao Zhang revealed that since August, the business in the Northeast region and the business in the Qingdao city circle have been outsourced by the company. By October, the company began to emphasize to them that “life is not easy”, which greatly reduced their performance.
Xiao Zhang said that, in fact, the benefits of Jinan City have been declining since the month he joined this year. “In June, the turnover of Jinan City Circle could reach about three or four million yuan a day, and in October it was only more than 400,000 yuan; in November, it shrank to only more than 200,000 yuan.”
According to Xiao Zhang, at the time of his resignation, the Jinan city circle had accumulated nearly four to five million yuan in payment from suppliers. As far as he knows, in addition to the other four urban areas, Shihui Group has defaulted at least more than 20 million yuan in payment from suppliers.
A group of suppliers also complained at the same time that they also found that in December, the return time of the Ten Hui Group was delayed longer and longer. Previously, they had withdrawn cash on the platform and would have cashback within 48 hours; now some suppliers have withdrawn cash for nearly a week and still have not successfully cashed back.
Lao Liu, a Shanghai supplier, decided to withdraw from the Shihui Mission platform a few days ago. Including a deposit of 10,000 yuan, he still has about 160,000 yuan on the platform that cannot be successfully withdrawn. On December 24, he found an Hangzhou operator who was in charge of the payment to urge him to refund, but was told that “currently, the payment is also called to the merchant before the cooperation”. Old Liu said angrily that this made him “very incomprehensible.”
In April 2021, Shihui Group announced that it had completed a D round of financing of US$750 million. It was at that time that Lao Liu chose to join the business of Shihui Group Free Shipping Mall to provide him with beauty products. The “Finance World” weekly learned that the free shipping mall is a new business launched by Shihui Group in July 2020, and the supplier will directly ship to the delivery address designated by the user.
Lao Liu said that he realized that the development of the Shihui Group had encountered difficulties in September this year. At that time, Shihui Group began to “retreat” its business in many regions in China. The business in Guangdong, Fujian, Zhejiang, Shanghai, and Northeast China was gradually shut down. Only Jinan was left in Shandong.
However, the business person in charge of Free Shipping Mall told the suppliers that the company “layoffs are for better development, and strategic retreat is also to find a better direction. Free Shipping Mall is still the company’s focus of future development.” This remark also gave Lao Liu at the time reassurance.
But what he never expected is that the company has not been able to settle accounts for him so far. In desperation, Old Liu could only withdraw from the platform and decided to come to “debt collection”.
Fujian supplier Liu Mei said that some of her suppliers have already withdrawn from the Shihui Mission platform. Liu Mei is responsible for docking with Shihui Mission employees and handling the finishing work. She said that the docking group between herself and the Shihui Group used to be seven or eight people, so far there are only 4 people left in the group, of which only two are employees of the Shihui Group, “all of them are newcomers.”
At the same time, what bothered her was that several orders between the company and the former purchasing staff of Shihuituan were not entered into the system. Currently, the people connecting with Shihuituan are new employees and told her that they could not solve the problem. “Maybe these will become bad debts in the end.” Liu Mei sighed.
Can Changsha still hold it?
Source: Tribune South Africa
The Ten Hui Group started in Changsha and is now trapped in Changsha.
Changsha is the birthplace of community group buying and the “core battlefield.” In the “Old Three Groups”, the base camps of the Prosperity Optimal Group and the Shihui Group are all here.
Founded in 2018, Shihui Group started as fresh fruit. In August 2019, it merged with the early community group buying platform “I You You”, which was deeply cultivated in Changsha, to focus on the second and third-tier city markets, and from this, it became a community group purchase. The top three places on the track, together with Xingsheng Optimum, and living on the same journey, are called the “oldest three groups”. By April 2020, its GMV exceeded 650 million yuan, and its daily order peak exceeded 1.6 million orders.
How important is the Changsha market to the Shihui Group? Many former employees told the “Finance World” weekly that Changsha is the “core place” of the Shihui Group. If Changsha “loses” and withdraws from the Hunan base camp, it means that the Shihui Group is also “finished”.
But now, the business in the Hunan area of Shihui Group is also in danger.
A former employee told the “World of Finance and Economics” weekly that all service stations of the Shihui Mission in Liuyang, Hunan Province have been closed, and the service station bosses are reluctant to do it because “the order is small and the money is at a loss”; Time has also changed from “within 3 days” before to “3 to 7 days” now.
According to News Websites in South Africa, former employees of the Shihui Group, the business turnover in the Changsha area reached more than 20 million yuan a day in June, which has shrunk to more than 500,000 yuan.
Read More Here: Vintage Culture