After Amazon's big seller was banned, it continued to sell under a different name...

Zebao is in trouble! The parent company of Zebao was questioned by the Shenzhen Stock Exchange because of problems such as the French store being fined 38.29 million yuan for failing to pay taxes in time , irregular accounting of revenue costs and sales expenses, which resulted in an inflated main business income of 63.2207 million yuan, inaccurate capitalization of R&D expenses, which resulted in an overstatement of intangible assets and profits of 1.5951 million yuan , and inaccurate inventory accounting, which resulted in an understatement of asset impairment losses of 1.045 million yuan .

This year, Amazon's strictest account ban wave caused Zebao to suffer heavy losses, and its brands were blocked one after another. Recently, public information showed that three brand stores under Zebao, including Anjou, were also suspended by Amazon . The total number of suspended sites has reached 330, which exceeds 70% of the total number of existing sites.

After Zebao and other big sellers were banned, their peers were also very concerned about the follow-up situation of these big sellers. According to foreign media reports, after Zebao's brand was banned, it "changed its vest" and continued to sell on Amazon!

The banned brand under Zebao is now selling on Amazon under a new name

Big sellers whose accounts have been blocked by Amazon have been looking for sales strategies to reduce losses. Some sellers have actively deployed other channels, including independent websites and other platforms, after being blocked. Of course, some sellers have changed their brand names and continued to sell on Amazon ...

Yien.com learned that according to The Verge, the three brands under Zebao that were banned have returned to Amazon for sales after changing their brand names.

The three brands are RavPower, Vava and TaoTronics. After changing their names, the three brands became "Rav", "Vav" and "Taotronic" respectively. The following are screenshots of the products of these brands on Amazon's official website↓

In addition to these three brands, Dioco's brand "Choetech" was also discovered by The Verge. The following is a screenshot from Amazon's official website↓

These screenshots were saved by foreign media before they reported to Amazon, but now these products cannot be found on Amazon's official website ...

It is understood that before The Verge reported these brands to Amazon, Amazon did not know that the sellers whose accounts were blocked had changed their vests and continued to sell products on the platform. After The Verge reported to Amazon, these products were removed from the shelves again.

Amazon issued a statement in response: “ We blocked these brands, their product detail pages, and selling accounts for policy violations. Unfortunately, these sellers used a variety of tactics to evade detection in an attempt to harm honest customers, selling partners, and Amazon.

We have many proactive controls in place that block the vast majority of their attempts. If you discover that a blocked seller has regained access to Amazon, we will promptly investigate and take appropriate action, including using this method to continue to improve our proactive controls. Customers can contact Customer Service 24/7 by phone, email, and chat . ”

Amazon does not have a formal policy for circumventing bans like other platforms . Although Amazon stipulates that sellers can only have one account, this does not apply if the seller changes the brand name and continues to sell, because Amazon has deleted the seller’s previous account.

However, Amazon’s latest statement makes it very clear that once a company’s first seller account is cancelled by Amazon, the company will no longer be able to sell on Amazon.

The Verge said: " In the period between reporting these products to Amazon and the platform removing the products, we purchased each of the products listed in the picture, received the goods and confirmed their legality. While waiting to receive the goods, we found that there were even more sellers selling these banned products, but we did not report them to Amazon, and these products are still sold on Amazon today . "

Regarding The Verge's report of illegal sellers to Amazon, many foreign netizens also expressed their opinions. One netizen said: "The Verge stood on Bezos' side and crushed these companies." Another netizen said: "Please don't tell Amazon anymore. Although I don't agree with this practice, you will make many people unemployed by doing this."

Of course, there are also many netizens who support The Verge's approach. They believe that The Verge is doing a good deed.

Although netizens have two different opinions, Amazon will only have one approach, which is zero tolerance for violations! Therefore, sellers must remember that when doing business on the platform, they must abide by the relevant rules of the platform and do not try to touch the red line of the platform!

Zebao was fined 38.29 million yuan , and its main business income was falsely increased by 63.2207 million yuan

In fact, in addition to being caught up in the Amazon account suspension storm, Zebao was also questioned by the Shenzhen Stock Exchange for issues such as being fined 38.29 million yuan for its French store failing to pay taxes in a timely manner , irregular accounting of revenue costs and sales expenses, which resulted in an inflated main business revenue of 63.2207 million yuan, inaccurate capitalization of R&D expenses, which resulted in an overstatement of intangible assets and profits of 1.5951 million yuan , and inaccurate inventory accounting , which resulted in an understatement of asset impairment losses of 1.045 million yuan . Let's take a look at the general circumstances of these matters below.

1. Zebao was held accountable by the French tax authorities and needed to pay a total of 38.29 million yuan in back taxes and fines . Shenzhen Zebao Innovation Technology Co., Ltd. (hereinafter referred to as Zebao Technology), a subsidiary of Xinghui Co., Ltd., received preliminary calculation results notifications from the French tax authorities on the back taxes to be paid by French stores on December 13, 2019 and February 25, 2020, and received a tax payment notice on November 30, 2020. According to the content of the notice, Zebao Technology's French store should pay a total of 4.95 million euros (equivalent to RMB 38.29 million) in back taxes and fines . As a major event on the balance sheet date, the back taxes may have a significant impact on the company's profits, but Xinghui Co., Ltd. did not disclose the relevant matters for the first time until March 18, 2021, and the information disclosure was not timely.

2. Zebao's accounting of revenue costs and sales expenses is not standardized. Upon investigation, it was found that Zebao Technology did not correctly account for revenue costs and expenses in accordance with the requirements of the enterprise accounting standards, resulting in Xinghui Co., Ltd. 's consolidated financial statements for 2019 and the first three quarters of 2020 over-recognizing main business revenue of 25.5048 million yuan and 37.7159 million yuan, over-recognizing main business costs of 10.447 million yuan and 14.8925 million yuan, and over-recognizing sales expenses of 15.0578 million yuan and 22.8234 million yuan.

3. The capitalized amount of R&D expenses is inaccurate. Upon investigation, it was found that Zebao Technology did not strictly follow the company's accounting system that only expenses incurred after the R&D project is approved can be capitalized. On February 1, 2019, the R&D expenses incurred before the VA-HS003 R&D project was approved on March 27 were capitalized, resulting in an overstatement of intangible assets and profits disclosed in the 2019 annual report of RMB 1.5951 million and an understatement of R&D expenses of RMB 1.5951 million.

4. Inaccurate inventory accounting. Upon investigation, it was found that Zebao Technology did not calculate the net realizable value of some inventories at the end of 2019, and did not measure the relevant inventories at the lower of cost and net realizable value, resulting in an overstatement of 1.045 million yuan in inventories and profits and an understatement of 1.045 million yuan in asset impairment losses disclosed in the company's 2019 annual report.

Regarding the above issues, Zebao’s parent company stated that it will hold those responsible accountable and make rectifications.

It is reported that after the account ban, Zebao began to vigorously develop the domestic market. At present, many brands under Zebao Innovation have opened their own brand flagship stores on e-commerce platforms such as Tmall and JD.com .

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