Can’t bear it anymore! Another Amazon best seller is officially delisted

In recent years, the cross-border e-commerce industry has undergone tremendous changes. Countless once-prosperous sellers have fallen into operational crises, with revenue and profits declining year after year, and have been forced to withdraw from the capital market.

Amazon's best-selling Mujia furniture officially delisted

Recently, there was news that Mujia Home Furnishing, a best-selling product on Amazon, was officially delisted.

The National Equities Exchange and Quotations Co., Ltd. has decided to officially terminate the listing of Mujia Home Furnishing shares.

Earlier in May of this year , Zhejiang Mujia Home Furnishing Co., Ltd. (hereinafter referred to as Mujia Home Furnishing) issued a stock suspension announcement and proactively applied to the National Equities Exchange and Quotation Company to terminate its listing. The stock will be suspended from May 27, 2024.

Mujia Furniture stated that based on the current industry development trends and the company's current operating conditions, in order to further improve the company's decision-making efficiency, reduce operating costs, effectively integrate internal and external resources of the company, focus on the company's own operations and development, and better maximize the interests of the company and all shareholders, after careful consideration, the company intends to apply for the company's shares to be delisted from the National Equities Exchange and Quotations.  

After the termination of listing, the company will continue to strengthen its operational management capabilities and professional technical level, continue to standardize operations in accordance with relevant laws and regulations, continue to improve the corporate governance structure, improve the internal control system, continue to focus on its core business, continue to strengthen its operational management capabilities, and enhance the market competitiveness of the company's products and the company's sustainable operating capabilities.

How did Mujia Home Furnishings, a best-selling brand on Amazon, go from its heyday to its current situation?

It is understood that Zhejiang Mujia Home Furnishing was established in 2004. After years of development, it has become a mature cross-border e-commerce company. Its main products include home textiles such as curtains, cushions, bedding, tablecloths, etc. The products are mainly aimed at consumers in many overseas countries such as the United States, Europe, and Japan.

Mujia home furnishing products mainly adopt the "independent brand R&D and design + own production" model, complete production and manufacturing domestically, and are sent to overseas warehouses after passing quality inspection and warehousing, and then sold through mainstream cross-border e-commerce platforms such as Amazon and Wayfair.

Mujia Home Furnishing's own brand Deconovo already has multiple hot-selling product links on Amazon with more than 10,000 reviews, and some links even have more than 50,000 reviews. The average monthly sales volume basically reaches thousands of pieces, and consumers' evaluation of the products is also very good.

Before 2014, Mujia Home Furnishing had been mainly engaged in general trade, mainly providing OEM production for overseas home textile merchants. Later, it transformed into cross-border exports and successfully went public in less than three years.

In 2016, Mujia Furniture’s annual operating income increased to 113 million yuan.

In March 2017, Mujia Home Furnishing was listed on the New Third Board, becoming one of the early listed companies in the cross-border e-commerce industry.

After Mujia Home Furnishing went public, its performance began to grow rapidly.

However, in 2021, Mujia Home Furnishing's performance began to fluctuate, with net profit falling by more than 92%.

In 2021, Mujia Home Furnishing's operating income was approximately 550 million yuan, an increase of 10.49% over the same period last year. The net profit attributable to shareholders of the listed company was 3.67 million yuan, a decrease of 92.41% compared with the same period last year.

This year, Mujia Furniture's operating profit fell sharply, which was to a certain extent attributed to the fact that the growth of operating income in 2021 slowed down due to factors such as the epidemic. At the same time, costs such as shipping costs, raw materials, energy consumption costs and Amazon platform fees increased significantly compared with the previous year, resulting in a decline in net profit in 2021.

In 2022, Mujia Furniture achieved operating income of 581 million yuan, a year-on-year increase of 5.76%, and the net loss attributable to shareholders of the listed company was 14.9 million yuan, a year-on-year decrease of 505.94%.

As for the reasons for the sharp decline in net profit, the company attributed it to "the increase in costs due to fluctuations in shipping costs and rising raw material prices, as well as the proactive price reduction of long-term inventory, which led to a decrease in gross profit margin."

In 2023, Mujia Home Furnishing's revenue began to decline, and its losses further expanded year-on-year. In 2023, Mujia Home Furnishing achieved operating income of 568 million yuan, a year-on-year decrease of 2.15%, and the net loss attributable to the shareholders of the listed company reached 63.5 million yuan.

In its business analysis, Mujia Home Furnishing mentioned that among the items with large cost changes, management expenses amounted to 31.86 million yuan, an increase of 31.16% compared with the same period last year, mainly due to the increase in employee salaries and inventory scrapping and damage in this period. Therefore, there may be problems in inventory management.

The leading home furnishing brand suffered losses of over 100 million yuan!

Mujia Home Furnishings was delisted due to business crisis, and many listed home furnishing companies are also having a hard time. Among them, Markor Home Furnishings and Qumei Home Furnishings have suffered the most obvious losses.

In the first half of this year, Meek Home Furnishing expects to lose 170 million to 250 million yuan, and Qumei Home Furnishing expects to lose 110 million to 150 million yuan.

Founded in 1990, Markor Home Furnishing is a leading enterprise in the home furnishing industry. It was listed on the Shanghai Stock Exchange on November 27, 2000. Markor Home Furnishing mainly operates the entire home furnishing industry chain business, including channel brands Markor Home Furnishing, ART, ART West District, Markor Home Furnishing sub-brands Rehome and Jonathan Charles, etc. Its brand products cover solid wood finished furniture, sofas, home accessories, sleeping supplies, custom cabinets, etc.

In the international market, Markor Home Furnishing owns four overseas furniture companies, namely Caracole, ART, Jonathan Charles and Rowe, with a sales network covering five continents and more than 60 countries and regions around the world.

As one of the earliest listed companies in the home furnishing industry, Meek Home Furnishing has remained profitable since its listing . However , in 2022 and 2023, the company suffered losses for two consecutive years for the first time.

Meek Home Furnishing has mentioned more than once in its financial reports that weak market demand and intensified competition have led to high marketing costs, causing the company to suffer losses.

Another leading home furnishing company, Qumei Home Furnishing , was founded in April 1993. It is a large home furnishing group integrating design, R&D, production and sales, with products covering the full range from hard furnishings, finished products, customization to soft furnishings.

On April 22, 2015, Qumei Home Furnishing was officially listed on the Shanghai Stock Exchange with the stock code 603818. In the year of listing, Qumei Home Furnishing's overseas revenue was 8.53 million yuan, accounting for only 0.68% of the total revenue.

On September 27, 2018, Qumei acquired Ekornes, a Norwegian national treasure-level listed company, and became a dual-listed company, which has since accelerated the advancement of Qumei's internationalization strategy.

By 2023, Qumei Home Furnishing's overseas revenue will reach 2.801 billion yuan, accounting for nearly 70% of its total revenue.

Regarding the main reasons for the company's performance loss, Qumei Home Furnishing explained that overseas business was affected by the increase in interest rates on interest-bearing liabilities, resulting in increased financial expenses, and the decline in Ekornes AS's revenue affected net profit.

In recent years, the home furnishing industry has faced considerable challenges, and many major home furnishing companies have been facing continued losses. How to better cope with market crises is an important issue that all these companies have to deal with.

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