Another big seller is in trouble: about 130 million yuan of funds are frozen, and nearly 1,400 employees have resigned

Another super sale gone wrong!

Today, another breaking news swept the screen: Nearly 340 Youkeshu accounts were "blocked" in batches by Amazon. As of July 6, among the restricted funds on Youkeshu's Amazon platform, the funds suspected of being frozen were about 130 million yuan.

After the accounts were blocked and funds were frozen, the number of employees at Youkeshu has dropped from nearly 2,800 at the beginning of the year to about 1,400 at present.

On the Amazon platform, where the trend of account bans is "enduring", Youkeshu, one of the four best sellers in South China, could not escape the fate of being "dead"...

Nearly 340 Youkeshu accounts were blocked by Amazon, and about 130 million yuan of funds were frozen

A lot of Amazon sellers have gone bankrupt recently. After seeing the word "dead account" , some onlookers felt calm. Until yesterday evening of July 6, an announcement from Youkeshu's parent company Tianze Information came out. The gossip hearts of many small and medium-sized sellers were ignited again, and they couldn't help but sigh: Oh my God, what happened to Youkeshu?

The editor learned from public information that as of July 6 , due to suspected violations of Amazon platform rules, Youkeshu has added about 340 blocked or frozen sites in 2021, accounting for about 30% of the average monthly number of sites with sales revenue on the Amazon platform from January to May 2021. Objectively, it has also led to a significant increase in the restricted funds on the Youkeshu Amazon platform. As of the date of disclosure of this announcement, among the restricted funds on the Amazon platform, the funds suspected of being frozen by Youkeshu are known to be about 130 million yuan.

In addition, as Amazon's e-commerce business continued to grow rapidly in early 2021 , more employees left to start their own businesses. In addition, the company has a heavy historical burden and more negative news. Since February 2021, Youkeshu 's employee turnover has become increasingly serious. The number of employees in Youkeshu has dropped from nearly 2,800 on January 1, 2021 to about 1,400 at present, including 2,300 supervisors (including deputy supervisors) and above.

There are nearly 280 staff members .

Tianze Information also stated in the announcement that due to the transformation to a high-quality product route, Youkeshu adjusted its business development direction and reduced the business and team size of the independent site accordingly. Along with the adjustment of the organizational structure, there was a serious loss of business personnel.

Youkeshu's independent website business has shrunk beyond expectations, with monthly operating income rapidly dropping from approximately RMB 45 million in January 2021 to nearly RMB 1 million in May.

On the other hand, Youkeshu began to strategically prepare inventory for the Amazon platform at the end of 2020. Given that the operating rules of the Amazon platform are the most stringent among many platforms, and the current transformation of Amazon is not as expected, the company expects that the turnover rate of stores on the Amazon platform will decline, and the corresponding inventory impairment provision ratio will also increase more than proportionately .

As mentioned above, given that Youkeshu's independent website business has shrunk severely and the Amazon business, which is the focus of its transformation, is currently not developing well, it is expected that Youkeshu's overall revenue in the first half of 2021 will drop by about 40%-60% year-on-year.

How big of an impact will Youkeshu have if your account is banned?

It is understood that since 2019, Youkeshu's cross-border e-commerce business has become the main source of income and profit for Tianze Information. In addition, Xiao Siqing, the helmsman of Youkeshu, has become the actual controller of the parent company Tianze Information .

Youkeshu, a well-known seller in the industry, "collapsed" late at night . The majority of cross-border sellers were left wondering: Can Youkeshu survive this fierce wave of account bans?

Tianze Information stated in the announcement that the above-mentioned freezing of funds, closure of stores and employee turnover will have a certain degree of adverse impact on the development of cross-border e-commerce business this year. However, given that Youkeshu's sales revenue on the Amazon platform accounted for about 28% in the first quarter of 2021 , and the independent station business is no longer the company's subsequent development focus.

The impact of the above-mentioned matters is still within controllable range.

Although Tianze Information stated that the impact of the Amazon account being blocked on the company is within controllable range, the actual situation may not be optimistic.

Data disclosed by Tianze Information in June this year showed that in 2020, the top five sales customers of Youkeshu were all overseas third-party e-commerce platforms. The relevant sales situation is listed as follows:

From this, we can see that Amazon is still the main source of Youkeshu’s operating income.

As can be seen from the above figure, in 2020, Youkeshu had 1,135 stores on the Amazon platform. However, in 2021, Youkeshu has had approximately 340 new sites blocked or frozen, and the proportion of blocked accounts is not small, indicating that this account blocking has dealt a heavy blow to the big-selling Youkeshu.

Account blocking continues, industry insiders: These sellers will be investigated

After the big seller Youkeshu also encountered an accident, a seller was filled with emotion: I feel that the biggest risk of doing business on Amazon is doing business on Amazon!

It is understood that Amazon has recently launched an unprecedented large-scale killing operation. It is rumored that a total of 200,000 accounts have been included in Amazon's "banned" blacklist. For a time, a large number of Amazon sellers fell into the fear of " Will my account still be there tomorrow? " The small card became the reason for panic for many sellers.

A service provider said that the federal committee tried to buy all bst and selling products, especially bst and ac labels to verify whether there is a card .

If yes, submit a lawyer's letter to Amazon . After Amazon receives the lawyer's letter, it will first mark the link in the background as having received the lawyer's letter and initiate an investigation . The specific investigation method is as follows:

Spot check of goods : 2 warehouses will be selected to spot check whether the goods have the cards and verify the evidence .

If no evidence is found , it means there is no substantiated evidence, and the report will be sent to the federal government .

If Amazon finds any , it will conduct a comprehensive inspection of the goods. If it finds any with the cards , it means that the federal evidence has been verified and the cards are confirmed . At this time, the seller’s store will be closed first and the store will enter an investigation period . During the investigation period , the store will be blocked , and the seller can move warehouses and withdraw money .

After investigation , it will be determined as fraud, the store will be completely frozen , and the goods and money will be confiscated .

The industry insider also said that account managers can see in the background which links have received lawyers' letters , and that a batch of links they submitted have not yet received them.

Regardless of whether the above statement is true or not, the seller must not go against the law and commit crimes. The small card cannot be kept anymore!

Amazon’s account blocking campaign continues, who will be next?

Speaking of the word "account blocking", there has always been a rumor: big selling accounts have the "protection umbrella" of the platform, so they are also immortal. Until recently, big selling accounts on Amazon died one after another, and these rumors were self-defeating. In fact, as long as you are not in compliance, no matter whether you are a big seller or a small seller, you will have no sense of security.

There are also many speculations about the reasons for this large-scale account blocking:

Some people say that these are the first three things that Amazon 's new leader will do upon taking office.

Some people say this is a stranglehold on Chinese sellers by Amazon;

Many people said that it was because the Chinese sellers themselves did not comply with the regulations, so they could not escape the fate of being "dead"...

Amid the wave of account blocking, there are many other speculations. Sellers who have violated the rules in the past are feeling uneasy. In contrast to this "gloomy" scene, those Amazon sellers who "clumsily" adhere to the platform rules day after day, not only have their accounts safe and sound, but have also benefited greatly from this account blocking operation.

“Amazon’s filthy environment should have been cleaned up long ago. To do business on Amazon, one should just do it honestly and based on one’s ability,” said a seller who claimed that he never faked orders.

"If you don't comply with the regulations, you will die. Sometimes, if you comply with the regulations, you will also die. Are the sellers whose accounts are blocked really all their fault?" The sword of blocking accounts continues to be wielded mercilessly. Industry insiders analyzed that Amazon's original environment of prevalent fake orders and fierce malicious competition also caused some sellers who wanted to comply with the regulations to slowly move towards the "forbidden zone of violations". On the road to achieving full compliance, Amazon sellers and the platform still need to work together.

Amazon’s account blocking campaign continues, who will be next?

How badly did those big sellers who have been banned have to spend the first half of this year? We might as well find the answer from their upcoming half-year revenue announcements ...

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