After defrauding more than 1,000 people, the agency operating company was wiped out!

When it comes to the term "agent operation", opinions among industry insiders are polarized. Some sellers believe that agent operation is a shortcut to boost online sales and can help them earn millions a month; but in the eyes of a large number of sellers, the term "agent operation" is often associated with fraud or scams, and is very convoluted.

Looking at the cross-border e-commerce industry, there are not many conscientious online agency companies. A large number of these agencies are just building luxurious buildings to entertain guests, but in the end the buildings collapse.

On March 15, Sanyi Supply Chain Group Co., Ltd. (hereinafter referred to as "Sanyi") and Henan Baiyao Information Technology Co., Ltd. (hereinafter referred to as "Baiyao"), two Henan-based operating companies, were busted by the police for suspected fraud. After hundreds of people were arrested, some victims came forward and more related inside stories were exposed.

"Before the backdoor listing of Weixinyou, Sanyi defrauded more than 1,000 people of over 300 million yuan in payments. After the orders were completed, they refused to withdraw the money and have not paid back a penny for nearly a year," a seller began to speak out for the previous case. Such voices continued to emerge, and some insiders revealed the inside story of Sanyi's fraud: the National Foreign Trade Platform collected money; the self-operated platform Starday created false orders; and the backdoor listing also required agency operations...

Another well-known company, Baiyao, is even more full of tricks. It used information such as the company's participation in public welfare and inspections by relevant leaders to fabricate a positive image of the company. It has no products, but uses high profits as bait and relies on rhetoric to confuse users into signing e-commerce hosting contracts. The amount involved in Baiyao's case is as high as 200 million yuan.

The agency operators are doing very well. Are they just looking for quick money? Are the agency operators really that bad?

Soft articles are everywhere, Sanyi defrauded sellers of more than 300 million yuan

It is a recognized fact in the industry that agency operation can make money quickly. In order to make money quickly, some sellers rush into the agency operation track, and Sanyi is one of them.

Sanyi was founded in 2017 and is located in Zhengzhou, Henan. It was originally a company that mainly operated Japanese overseas warehouses and self-operated the Starday platform. Among them, the self-operated platform Starday has always used its own platform to lend money to merchants, and all risks have been grafted to merchants; the overseas warehouse platform has never been profitable; it has also invested in other industries, such as fast-moving consumer goods, real estate, film and television, etc., but the splash is not large. After seeing the ability of agency operations to make money, it switched to the agency operation track. According to statistics from the Internet and some other channels, the total amount involved in Sanyi's fraud exceeds 300 million.

Using Weixinyou as a shell company, Sanyi’s agency operation defrauded RMB 70 million

According to industry insiders, Sanyi was arrested this time because it used Weixinyou Information Technology (Zhengzhou) Co., Ltd. (hereinafter referred to as "Weixinyou") to illegally raise funds and commit online fraud using the cross-border e-commerce platform Starday. So far, nearly a thousand merchants have been affected, and the amount of money defrauded from a single merchant ranges from 20,000 to 5 million yuan, with a total amount of about 70 million yuan.

A seller revealed that he added a Starday staff member on the official account. They claimed to be the Chinese investment promotion office of Japan's Starday in Zhengzhou. They charged 1,998 yuan to provide teaching courses, saying that they would teach novices one-on-one. However, after selling the goods, the sellers were unable to log in to the backend to operate, and the staff member did not reply to messages and disappeared out of thin air.

Some sellers were relatively lucky. They spent 300 yuan for guidance and entered the Starday platform. They received orders in two weeks and made more than 7,000 yen, which was almost all of their money back. However, the sellers listened to the customer service and paid for the shipment and freight. The platform has a minimum deposit limit of 20,000 yen, which is about 1,000 yuan. On March 15, the staff of Sanyi Company was suddenly arrested and disappeared.

The above sellers have only invested a relatively small amount of money. Some sellers reported that there are many sellers who have invested hundreds of thousands or even millions of yuan. "I also work for Starday. I have invested almost one million yuan in total. Now it is all gone. I dare not tell my family because all the money was borrowed," a seller revealed.

A seller secretly felt lucky after seeing Sanyi’s collapse: “Fortunately, I made a profit last year and ran away. Later, I checked Sanyi’s company information and found that their company was still recruiting people.”

However, the signs of trouble at Sanyi did not appear this year.

The National Foreign Trade Platform collected money, the Starday platform created fake orders, and Sanyi defrauded over 300 million yuan in payments

As early as 2022, Sanyi had been filed, but due to issues such as illegal fund-raising, it has not been determined. According to the timeline, Sanyi's national foreign trade platform had already collapsed in 2022, and began to use Weixinyou as a shell company around April of that year. Before that, Sanyi mainly used its own national foreign trade website and cross-border e-commerce platform Starday to cooperate with fraud. Some sellers even revealed that the amount of fraud involved in Sanyi had reached 300 million at that time.

"Sanyi used fake foreign trade orders on its Starday cross-border e-commerce platform to deceive customers into participating in reverse purchasing, promising one-to-one real orders and defrauding more than 1,000 people of more than 300 million yuan in payments. After the order was completed, no cash was provided and no money was returned for nearly a year. A case has been filed," a seller said on a social platform in September 2022.

Coincidentally, there are also sellers who say: Quanmin Foreign Trade has collapsed, and it has been more than two months since I could withdraw cash. The goods are fake purchasing products, and the funds are used for other purposes. It is a typical contract fraud. I was defrauded of 590,000 yuan. A seller commented below: "I played for a year and quit decisively. This thing is ridiculous. There are thousands of bicycles a day. Why do Japanese love riding bicycles so much?"

On a certain complaint platform, the Quanmin Foreign Trade Platform can also be seen. "The Quanmin Foreign Trade Platform under Sanyi claims to make Chinese products go abroad and make money from foreigners, but now consumers are not allowed to withdraw their investment money," a seller filed a complaint.

At that time, many sellers reported that they could no longer withdraw money from the platform. The platform also tricked investors into signing a confidentiality agreement, saying that they would get their money back after signing. However, after the investors signed the contract and put their fingerprints on it, the other party would always delay the time with various reasons and not get their money back.

At the same time, the National Foreign Trade Platform has begun to erase user traces. At the top of the website, click on the user name and enter the user center, and you can no longer see the user's real-name information. Even if the investor's real-name authentication has been completed, they still cannot query their name and other information, and the website cannot find any contracts.

Starday platform becomes a money-making tool, with hundreds of suitcases delivered every day during the epidemic

Initially, Sanyi promoted its foreign trade business on all major websites, with soft articles one after another. There were countless articles such as "There are constant scams in mutual financial management, and the national foreign trade model has become the first choice for financial management users", "Financial management is slightly declining, and investors are transforming to a new foreign trade model for steady income growth", and at the end of each article, the topic would change and brag about a financial management: national foreign trade financial management, a new model with an expected annualized return of 15%.

The company's business process is that users pay money to the National Foreign Trade Platform, and the platform uses the user's funds to purchase goods and ship them abroad. The goods will be listed and sold on the Japanese e-commerce platform Starday, and the sales profit of the products will be returned to the National Foreign Trade. After 30 days, the funds and profits of the purchase will be returned to the user, and the user will receive 1.2% of the profit and principal of the product price.

At the same time, the platform also promises that users do not need to participate in purchasing goods on behalf of others, nor do they need to bear the risk of selling goods abroad. All expenses incurred during the period will be borne by the platform, such as tariffs, transportation, warehousing, etc. Users only need to wait for the end of the product sales cycle to collect costs and profits.

Sanyi claims that its platform is a new investment option for “earning profits with peace of mind”, but is this really the case?

It is understood that after users transfer money to the National Foreign Trade Platform, they will not receive an invoice or see a purchase order, which means that the funds are unsupervised and the information is not transparent.

Although Quanmin Foreign Trade publishes payment notices every day and publishes relevant information about the marketing and delivery of products on the Japanese Starday platform, and hundreds of suitcases were delivered every day during the epidemic, some sellers found something different. The inventory of the only product of the same model on the Starday platform has remained unchanged, and there are only a few comments, the last of which was in 2019.

Some sellers questioned this, but Starday said that there is a convenience store, but the business has not yet been launched. If the online business inventory is not moved and the offline business has not been launched, why do they have to send suitcases to the Starday platform every day?

According to the announcement of National Foreign Trade, the number of goods sent to Starday every day is as high as 10,000 pieces, and this is during the epidemic. The unchanged inventory is equivalent to unsalable goods, delivery and distribution have been uninterrupted during the epidemic, and the number of goods has been increasing. Some sellers have discovered various unreasonable behaviors of National Foreign Trade.

At the same time, many sellers also have doubts about the Starday platform. According to the platform's introduction, Starday has 5 million registered users, has cultivated 200,000 gold medal sellers, and has a full range of products on the platform, including clothing, home appliances, pet supplies, children's toys, daily groceries, etc.

But according to the data in July 2022, Starday has only 6.3K monthly active users across the entire platform, which is enough to show how much water there is in it and how it can support hundreds of thousands of sellers.

Baiyao’s fraud amounted to 200 million yuan, and the high profits were the bait

Public information shows that "Baiyao Cross-border E-commerce Service Provider" is affiliated to Henan Baiyao Information Technology Co., Ltd., which was established in 2016. The company's official website claims that it has been deeply engaged in cross-border e-commerce services for 10 years. It originated in Yiwu, China, and entered the Henan market in 2017. In 2019, its turnover exceeded 400 million yuan. The address is located in Changtong E-commerce Park, Zhengdong New District, Zhengzhou, Henan. On February 25, 2023, the company was enforced by the local court for failing to perform legal obligations on time.

Net profit of 450,000 yuan in 2 years, Baiyao cheated a group of people in this way

"On March 15, all the staff of Baiyao Company lost contact. It was not until I received a call from the police that I learned that Baiyao Company was shut down by the police for suspected fraud, but all my money was still in it," said the seller Xiao Li.

After seeing Baiyao’s promotion on the short video platform, Xiao Li was very excited and immediately added the contact information of the relevant business personnel. The business personnel sent Xiao Li relevant information such as the company’s participation in public welfare, leadership inspections, etc. to build a positive image of the company.

At the same time, they also used rhetoric to emphasize the popularity of a certain platform overseas. In the business person’s circle of friends, you can also see pictures and videos of the source of goods, shipping pictures, stores and warehouses. Xiao Li was deceived step by step and spent nearly 200,000 yuan. Baiyao Company guaranteed that the seller’s net profit for 2 years would be 450,000 yuan.

With only a set of rhetoric and a false image created by friends, Xiao Li, who had never seen the so-called online store and goods of the salesperson, fell into the trap set by Baiyao. Xiao Li had never doubted the sales screenshots and goods videos, but the thunderbolt on March 15 made Xiao Li see the truth of the matter.

Like Xiao Li, seller Xiao A was also attracted by the promotion of "Bai Yao Cross-border E-commerce" on the short video platform, so he added the customer service staff on WeChat and invested 100,000 yuan to let the other party operate an overseas warehouse on his behalf. The other party boasted about the company's history and purpose. At the same time, Bai Yao promised to guarantee the net profit of seller Xiao A.

At the end of August 2022, seller Xiao A invested in a store, with an overseas warehouse costing RMB 100,000 for operation and management. Baiyao guaranteed a net profit of RMB 450,000. When the two-year contract expired, his profit was exactly the same as Xiao Li's.

When asked about the company's store operations, Baiyao claimed that the company operated more than 1,000 stores, and the net profit of the stores was between 25% and 40%. If we convert more than 65,000 US dollars into RMB, it would be about 400,000 yuan. The salesperson said that basically one order can be placed every 10 days. When the seller Xiao A asked whether the goods needed to be shipped, the Baiyao salesperson said that the company provides a one-stop managed store service. At the same time, they also shared chat screenshots of other customers placing orders. It only took 9 days from the beginning of cooperation, registering a store to placing an order.

However, the overseas warehouse was not as profitable as Baiyao's sales staff initially claimed, but rather unsatisfactory. Under the persuasion of the sales staff, the seller Xiao A continued to invest money and upgrade the warehouse, and invested about 1.5 million in total.

According to seller Xiao A, Baiyao Company has an operation group with 6 operators, who will post in the group every day who has placed multiple orders and how much they sold. Later, the operation of seller Xiao A's overseas warehouse became worse and worse, and the sales staff began to persuade Xiao A to increase traffic and upgrade Xiao A to an overseas warehouse of 200,000.

Even so, the sales of seller Xiao A were still not ideal. Sometimes they said the goods were out of stock, and sometimes other problems arose. Xiao A kept transferring money to them, about 50,000 each time. Until March 15, seller Xiao A found that all the staff of this company had lost contact. But Xiao A still had about 800,000 in payment for goods and franchise fees.

Baiyao has reached cooperation with Starday Japanese e-commerce platform under Sanyi

In Baiyao's public introduction, we can see that Baiyao reached a cooperation with Sanyi's Starday platform in 2021 to enter Japan's cross-border e-commerce. Baiyao said that thanks to Starday's traffic support and Baiyao's high-quality supply chain, Baiyao's turnover on the Starday platform exceeded 3 million yen in the first month.

The two parties continued to cooperate in 2022 and stated that they would start a new e-commerce model. The powerful combination of the two fraudulent companies ultimately did not produce any fruitful results.

At the same time, in Baiyao's corporate development history, we can also see Baiyao's exaggeration of its own achievements: it has served more than 4,000 students, operated more than 400 stores, and its cooperative warehouses have exceeded 10,000 square meters, including 8,000 square meters in Yiwu, 1,400 square meters in Zhengzhou, and 900 square meters in overseas warehouses, but the water content in this remains to be examined.

Is the agency operation just for making quick money? The fact is not so

In the market, whether it is a cross-border e-commerce platform or an independent website, there are indeed many companies doing agency operations. To be honest, the agency operation business is very complicated, and many of them are marketing-type companies. Early communication is very convenient, but sometimes in order to promote project cooperation, they will ignore the essence of the matter.

Many bad agency cooperation models are held through the sales meeting model, that is, a meeting is held in a hotel, and then various promises are made, and finally a lot of orders are forced. Some sellers may cooperate half-heartedly for the sake of face. "Basically, they go with the mentality of seeing it, and finally cooperate unknowingly," a seller reported.

Through false promises and falsified performance, some illegal agents have induced cross-border sellers to open stores and charged high service fees, leaving countless sellers with nothing. Some agent operation models have even begun to upgrade, and for some prospective sellers who want to enter the industry but are hesitant, they usually offer the dual temptation of "training + sales guarantee" to reap double benefits.

For some veteran sellers, the risks and benefits of both parties are quite unequal. The risks are basically borne by the sellers, who need to stock up, pay marketing expenses, and pay service fees to the agency. In the end, if the store is successful, it's fine, but if it's not, it will be a huge loss.

So many sellers think that the agency operation is "cutting leeks", but not all agency operations are like this. Existence is reasonable, and the existence of agency operations is also in line with the logic of the essence of business. The entry of cross-border big sellers such as Anker into the agency operation track also indirectly confirms this point.

Putting aside the controversy among insiders, the agency operation industry actually contains many down-to-earth people. One seller said, "My two stores are run by agency operations. Currently, the stores are profitable and both parties win." There are also factory operators who said that the cooperation model between the company and the agency operation is based on the sales profit sharing, which is split in half between the agency operation company and the factory, and the two sides have been cooperating in a friendly manner for many years.

Given the differences between agents and sellers, it is wise to make a clear distinction between the interests of both parties if they want to go further. Sellers just want to run their stores normally and make money, while agents want to make their own money through services. Only when both parties cooperate under the premise of established commercial interests can they achieve long-term success.

The current agency operation market can be described as a mixed bag. It will take some time and accumulation for it to be standardized in the future, and it also requires the optimization of the cooperation model between the two parties. It is said that one rat spoils the whole barrel. The removal of the two rats, Sanyi and Baiyao, will undoubtedly bring new vitality and opportunities to the development of the cross-border e-commerce industry.

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Samick

Baiyao