Delisting! Another cross-border company falls silently

The development of cross-border e-commerce is ever-changing. As time goes by, some small sellers have gradually grown into big sellers, while some big sellers have been gradually eliminated by the times and fallen from the altar.

Recently, Global Easy Shopping was ruled to be bankrupt and liquidated, and the Taiyuan Intermediate People's Court issued a "Civil Ruling" to seal up all the assets of Shenzhen Global. Coincidentally, the once cross-border listed company also fell quietly.

Yesterday, Shenzhen cross-border company Wanfang Network was officially delisted.

On December 10, Wanfang Network was officially delisted.

The reason for termination is failure to disclose the annual report or semi-annual report within the prescribed time limit, and the annual report or semi-annual report is still not disclosed within 2 months from the date of expiration .

The editor learned that 2022 is approaching, and Wanfang Network's 2020 financial report has not yet been disclosed. In this regard, Wanfang Network previously explained that ST Wanfang was originally scheduled to disclose its 2020 annual report on the National Small and Medium Enterprise Equity Transfer System Information Disclosure Platform on April 30, 2021. Due to the company's tight funds, it is unable to pay the advance payment to the accounting firm , and the auditors have not yet entered the site. It is expected that the 2020 annual report will not be disclosed on schedule.

Due to severe losses, Wanfang Network ’s revenue for 2020 has not yet been released. In this regard, Wanfang Network and the company’s responsible persons also received fine notices.

It was not until Wanfang Network was delisted that many sellers realized that there was a listed company in the cross-border circle called Wanfang Network. When did Wanfang Network go public? What products does it mainly sell? How much money does it lose every year to not even be able to pay the accounting firm for auditing its annual report?

After its successful listing in 2017, Wanfang Network started to suffer losses year after year

It is reported that on April 25, 2005 , Wanfang Network Co., Ltd., formerly Shenzhen Wanfang Network Information Co., Ltd., was established . It is a company focusing on cross-border e-commerce. Its main products include tablets, smart phones, laptops, smart homes and other 3C products .

Wanfang Network's products are mainly sold online. Large international third-party e-commerce platforms such as eBay, Amazon, and Aliexpress are the main sales channels, accounting for more than 90% of sales.

  On February 16, 2017 , Wanfang Network was officially listed on the National Equities Exchange and Quotations (NEEQ) , with the stock name: Wanfang Network, stock code: 870462, and a total share capital of 22,799,059 shares. The company's chairman, Li Jianwen, is the actual controller.

After Wanfang Network successfully went public, it also received 600,000 yuan in government subsidies in accordance with the requirements and regulations of the "Shenzhen Nanshan District Independent Innovation Industry Development Special Fund -Economic Development Sub-Fund Enterprise Listing Financing Incentive Project" .

The success of the IPO reflects, to a certain extent, that Wanfang Networks also had its own glorious period. " Wanfang Networks' sales areas are all over the world, and the iRULU brand independently developed and produced by the company has become an excellent brand sought after by mainstream media and mass consumers in the United States ," said Li Jianwen, chairman of Wanfang Networks . In May 2011 , the company really started to develop a host brand, with annual sales of only 500,000 US dollars , but Wanfang Networks developed rapidly, reaching more than 100 million by 2013. In 2015, Wanfang Networks began to increase investment and expansion and prepared to apply for the New Third Board .

During the listing period, Wanfang Network's operating income for 2014, 2015 and 2016 was also announced, which were RMB 211 million, RMB 253 million and RMB 280 million respectively; the net profit was RMB 11.498 million, -RMB 70.4631 million and RMB 849.25 respectively .

It is reported that Wanfang's host brand positioning is divided into high, medium and low-end, and a series of sub-brands have been established, mainly targeting the middle class such as white-collar workers and office workers. Sub-brands include white-collar business versions and other consumer groups. The positioning is a bit high . " Our own host brand is like the Toyota car in the digital world. It is not cheap, nor is it as arrogant as BMW and Mercedes-Benz. It gives people a more real feeling. "   Li Jianwen once said.

It is worth noting that since its successful listing, Wanfang Network has been on the road of consecutive years of losses in sales and net profit. Its specific financial report data in 2017, 2018, 2019 , and the first half of 2020 are as follows↓

In 2017, the revenue was 151 million, a decrease of 45.87%, and the net profit was -49.9983 million, a year-on-year decrease of 688.73%; in 2018, the revenue was 16.474 million, a decrease of 89.15%, and the net profit was -21.4826 million, a year-on-year decrease of 57.03%; in 2019, the revenue was 5.3298 million, a decrease of 57.65 % , and the net profit was -2.3089 million, a year-on-year decrease of 97.62% ; in the first half of 2020, the revenue was 1.7 million, a decrease of 51.74 %; the net profit was -1.76 million , a year-on-year decrease of 1475.03%.

Overall, although Wanfang Network 's sales in 2017 were still in the billion-level club, its net profit was negative, with a loss of nearly 50 million. In 2018, it officially fell out of the billion-level sellers echelon, with annual revenue of less than 20 million, and its revenue in 2019 was just over 5 million.

In terms of platforms, the financial report shows that from January to June 2020, Wanfang Network's revenue on Amazon was 1.0551 million, its revenue on eBay was 18,000 , and its revenue through offline and other channels was 629,700. Although Wanfang Network's revenue data on all platforms is very poor, Amazon is still its largest source of income.

However, such revenue data is indeed far behind that of many cross-border listed companies, and is even lower than that of many mid-sized sellers in the cross-border circle who quietly make money. Therefore, many sellers in the industry also have doubts about how Wanfang Network became a listed company:

A: The listed company only had such low sales in the first half of 2020 , and my sales in half a year were more than 1 million US dollars. Can I be inflated ?

B: Cross-border e-commerce sellers can earn millions of RMB in half a year , and there are many sellers who earn millions of USD per month . How did Wanfang Network manage to get to this point ?

C: I was so eager to go public , and then the data looked good, and I lost so much money that I was left with nothing ... Is this the story?

After years of losses, Wanfang Network and its chairman became dishonest persons. According to data, in February 2019, Wanfang Network was listed on the list of dishonest persons subject to enforcement by the Shenzhen Intermediate People's Court. In June 2018, Li Jianwen, the controlling shareholder and actual controller of Wanfang Network , was listed on the list of dishonest persons subject to enforcement by the Shenzhen Intermediate People's Court .

Why did Wanfang Network decline?

It did not attract much attention from cross-border sellers during its listing period, and even after its delisting, it did not cause much splash in the cross-border circle. How did Wanfang Network, which once sold billions of products, end up in such a state?

In the financial report for the first half of 2020 , Wanfang Network stated that the reason for the decline in performance was that the cross-border e-commerce industry was highly competitive, and the company's sales on the Ebay and Amazon platforms encountered certain market pressures, resulting in a decline in operating income ; and affected by the new crown pneumonia epidemic, logistics costs increased, sales were hindered, and the decline was significant.

As the saying goes, a three-foot-thick ice does not form overnight. There must be multiple factors that have led Wanfang Network to its current state. If sellers want to gain a foothold in the cross-border circle, they must have real skills. Otherwise, even listed sellers cannot avoid losses and decline.

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