Saturday, November 26, 2022

China’s first luxury e-commerce company “Secoo” feared to flee the headquarters

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The Daily Economic News reported that “luxury e-commerce – Seku is suspected of escaping and people are moving into empty buildings” attracted attention, and related topics appeared on Weibo on the 17th.Temple LibraryBeijingThe first to fourth floors of the headquarters are completely empty, and only the fifth floor has a few employees. Siku replied to a reporter from China-Singapore Jingwei, “Our office is only on the first floor, which is the fifth floor. At present, the office area has not decreased, and several hundred people are working normally.” But in fact the library of the temple is on the verge ofbankruptcycorner.

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According to Beijing News, on the China National Enterprise Bankruptcy and Reorganization Case Information Network, on August 10, Beijing Sekoo Trading Co., Ltd., a luxury e-commerce company affiliated with Secoo, added a high-risk bankruptcy reorganization message. The applicant is Zhao Dongping. The court of law is Beijing No. 1 Intermediate People’s Court. It’s worth noting that this is the second time Secoo has filed for bankruptcy liquidation this year. At the time, the move was perceived by the outside world as a sign that “Secoo was going bankrupt”, but it was rejected by the Secoo side. The next day, the applicant withdrew the application.

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Tianmu News reported, “Every company has its own era, and everyone has their own era. I believe that the era of high-end consumption in China has just begun. Secoo’s era of globalization has just begun.” Has happened.” In 2014, Secoo founder and CEO Li Rixue once said so.

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At that time, Secoo was not yet listed, but the number of registered members in China had grown to 2 million, annual sales exceeded 1 billion yuan, and it had gone through four rounds of financing. Secoo has made up for the industry’s weaknesses in the fields of professional evaluation, secondary circulation of luxury goods and after-sales service, and set a standard for secondary circulation of luxury goods in mainland China. The future looks very bright.

On September 22, 2017, Secoo landed on the Nasdaq in the United States and became “the first part of Chinese luxury e-commerce” to issue 8.5 million US depository shares at an issue price of $13, raising a total of $110 million. Prior to this, Secoo had received five rounds of financing of approximately US$200 million.

However, on the other side of the stock market, Secoo broke out on the first day of listing. Since then, the stock has experienced price volatility and has continued to decline since 2019. Secoo share price trend is like a smooth curve. No upward trend as of now. At press time, Secoo had a stock price of US$0.247, down 1.59%, with a market cap of US$174.51 billion.

The crisis that Siku is facing now will be seen in 2019. The financial report shows that in the first quarter of 2019, its active user growth rate was 89.6% year-on-year. In the fourth quarter of 2019, that number dropped to around 50%. In the third quarter of 2020, the growth rate was only 7.5%.

In terms of performance, from Q1 of 2019 to Q3 of 2020, Secoo Group’srevenueThe quarter-on-quarter growth rate declined to -29.26% from 46.47%. From the fourth quarter of 2019 to the fourth quarter of 2020, Secoo Group’s net profit declined for five consecutive quarters year-over-year, with the biggest decline being 397.91%. On November 9, 2021, Secoo Group released its “long overdue” 2020 financial report. According to the financial report, Secoo Group’s revenue in 2020 was 6.02 billion yuan, a decrease of 12% year-on-year; The net loss was 71.86 million yuan, which turned from profit to loss. It is reported that the annual report was to be released in May of that year, but Secoo Group delayed it for almost half a year, and was warned by Nasdaq.

On December 31, 2021, Secoo Group released its unaudited financial report for the first half of the year ended June 30, 2021. Data shows that Secoo Group’s revenue in the first half of 2021 was 1.526 billion yuan, a decrease of 34.0% year-on-year; net loss was 39.826 million yuan, and the same period in 2020 net loss was 36.598 million yuan; Adjusted net loss was 37.467 million yuan, up from the figure for the same period in 2020 was 31.507 million yuan. Furthermore, in the first half of 2021, it had 568,900 active users, down 13.6% year-on-year.

On May 13, Secoo released its 2021 annual performance report. The financial report shows that the company’s revenue in 2021 will be 3.132 billion yuan, a decrease of about 48% year-on-year; Its net loss will reach 566 million yuan, an increase of 6 times year-on-year.

In the face of Secoo’s deteriorating situation, the company’s founder, chairman and CEO Li Rixue expressed in January last year that he expected Secoo to be acquired or privatized for $230 million, according to Beijing News. Despite Li Rixue’s strong will, to date, there is no one in the market who can handle it.

Regarding the sluggish performance over the past two years, some analysts believe that Secoo’s luxury goods situation narrows its categories, the products are not rich enough, and traffic support is lacking. In addition, there are more and more channels for consumers to buy luxury goods, and their attractiveness to users is gradually decreasing.

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