Amazon announced its closure on the eve of Prime Day, and all employees were fired!

In today's rapidly changing market, even once-popular brands may face severe challenges.

Amazon's best-selling Care/of announces closure

Recently, Amazon's big-selling brand Care/of announced its closure on the eve of Prime Day and all its employees were fired.

(Image source: Care/of official website)

It is understood that Care/of's brand website has been closed. In the official website announcement, Care/of said: "We explored the possibility of keeping the brand alive, but the outcome was failure."

Care/of is a well-known nutritional supplement brand on Amazon, founded in New York, USA in 2016. Care/of is one of the first companies to customize personalized nutrition plans for the public, mainly tailoring vitamin packages for consumers to meet the target group's needs for healthy eating.

Unlike other conventional sales models, before purchasing Care/of products, consumers will first fill out a health survey, which will help the brand understand the consumer's living, eating and taking habits, and clarify the consumer's specific needs. Care/of will use algorithms to match the appropriate vitamins and other nutritional supplements to customize personalized products.

Care/of mainly provides nutritional tablets such as vitamins, nutritional instant powders, plant protein powders and other products, which are provided in 30-day quantities and users can purchase them in any combination they like.

With its innovative ideas, Care/of has aroused widespread discussion and attention in the health and nutrition industry and won a large number of loyal customers.

Since Care/of was founded, the revenue from its main business has basically doubled every two months, making Care/of a top seller on Amazon.

According to statistics, more than 5 million users have filled out Care/of's questionnaire, and the brand has tens of thousands of members who subscribe on a monthly basis.

Care/of will also continue to launch new products based on user needs, update the content of the questionnaire in conjunction with new products, and create an APP where users can record their average daily vitamin intake and read related health-related content.

While gaining market recognition, Care/of has also attracted the attention of capital.

In November 2016, Care/of received $3 million in seed round financing, led by Juxtapos, followed by Tusk Ventures and Andy Dunn.

In August 2017, Care/of received more than 10 million US dollars in Series A financing, led by Goodwater Capital, followed by Juxtapose, RRE Ventures, and Tusk Ventures.

In August 2018, Care/of received US$29 million in Series B financing, led by Goldman Sachs Investment Partners, with participation from Goodwater Capital, Juxtapose, RRE Ventures and others.

After receiving investment from Goldman Sachs in 2018, Care/of was valued at US$160 million.

In December 2019, Care/of received a new round of financing of US$40 million, and the investors were not disclosed.

In November 2020, global pharmaceutical giant Bayer announced the acquisition of approximately 70% of Care/of's shares. Bayer wanted to unlock new revenue channels through the acquisition to expand its business in the nutritional health field. At that time, Care/of's valuation reached US$225 million.

Why did Care/of, which was once so popular, end up going out of business?

In recent years, as market competition intensified and consumer demands and preferences continued to change, Care/of's personalized nutrition product customization service also lost its appeal. In-depth analysis shows that this is also because Care/of's product innovation has not kept up with the pace of the market.

On the other hand, Care/of’s marketing promotion may not have achieved the desired effect. Care/of’s marketing failed to effectively reach its target customers, resulting in a decline in market share.

Meanwhile, Care/of's parent company Bayer is also in deep trouble.

Bayer's full-year revenue in 2023 was 47.637 billion euros, a decrease of 6.1% from 50.739 billion euros in the previous year. Its full-year net loss in 2023 reached 2.941 billion euros, and its performance was under pressure.

Since acquiring Monsanto Company in 2018, Bayer has been facing multiple lawsuits in the United States over product safety issues, which has cost it a huge amount of money. In 2020 alone, it cost about $11 billion.

According to Bayer's annual report, of a total of about 167,000 claims, about 113,000 have been settled or were ineligible for various reasons. Bayer has currently set aside $6.3 billion for glyphosate litigation expenses, but there are still about 54,000 cases pending.

Bayer's Chief Financial Officer and board member Wolfgang Nickl said that litigation is a very large expense and that without the litigation, Bayer would generate an average of about 5 billion euros (about 5.4 billion U.S. dollars) in cash flow each year.

In order to save itself and resolve the company's financial crisis, Bayer had to take measures to reduce costs and increase efficiency, and began to suspend plans to split the consumer health or crop science divisions, focusing on resolving litigation issues, reducing debt and improving the company's performance.

As a result, Bayer decided to stop further investment in Care/of, a move that exacerbated Care/of's predicament.

Amidst the crises, Care/of has seen declining product sales and revenues.

At the same time, new personalized nutrition brands continue to emerge on the market, which also has an impact on Care/of.

Ultimately, the once high-profile brand was forced to cease operations and laid off 143 employees by July 3.

The cold wind is blowing! Many big Amazon brands can’t stand it anymore

Since the beginning of this year, big brands have continued to lay off employees, close down and go bankrupt on the Amazon platform.

In April 2024, Amazon's well-known power meter and indoor fitness bike brand Stages Cycling announced the cessation of operations and laid off all employees.

All products in Stages Cycling’s brand store on Amazon are shown as unavailable for sale.

The brand is quite famous in the field of professional cycling equipment. Its full range of outdoor bicycle power meters and indoor fitness equipment have been popular all over the world and are highly sought after by cycling enthusiasts.

Stages Cycling's cessation of operations is directly related to its long-term overdue payments.

The company's dispute with Giant Bicycles, a bicycle company headquartered in Taiwan Province of China, has been going on for a long time. From June 2022 to January 2024, Stages Cycling owed Giant Bicycles a number of payments including power meters, fitness bicycles, product parts, storage fees, freight fees, etc., with a total of 161 unpaid invoices.

Giant Bicycles is launching a lawsuit against Stages Cycling, demanding it pay approximately NT$454 million in unpaid invoices.

In April 2024, BowFlex, a well-known Amazon fitness equipment seller, filed for bankruptcy.

According to the bankruptcy protection documents filed by BowFlex, BowFlex plans to lay off 200 employees and enter Chapter 11 bankruptcy reorganization.

The company's bankruptcy is related to the sharp decline in product demand. In recent years, the growth momentum of the BowFlex brand has gradually faded, and the company's operations have also been directly affected.

At the same time, BowFlex also sold its remaining assets, and Johnson Healthcare, a listed company in Taiwan Province of China, has confirmed that it will acquire the company for only US$37.5 million.

In May 2024, Amazon's well-known shoe brand Shoes For Crews filed for bankruptcy protection in the Delaware Bankruptcy Court under Chapter 11 of the U.S. Bankruptcy Code.

As the pioneer of anti-slip shoes in the United States, Shoes for Crews was founded in 1984. For more than 40 years since its establishment, Shoes for Crews has been committed to the development of anti-slip shoes and is a leading seller in the anti-slip shoe category on platforms such as Amazon and Walmart. Taking Amazon as an example, black anti-slip shoes are very popular, with product prices ranging from US$50 to US$70, and popular items have more than 2,000 reviews, or even tens of thousands.

The debt problem is undoubtedly the most serious reason for its bankruptcy. According to statistics, Shoes for Crews has debts ranging from 500 million to 1 billion US dollars, among which the debts of the top ten creditors total more than 20.5 million US dollars.

The closure and bankruptcy of so many big Amazon brands is also a warning to other companies. In the ever-changing market, it is necessary to adjust operating strategies in a timely manner and find more effective profit models.

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