The sudden closure of two major interior design companies in China led to a wave of protests by laid-off workers, angry customers and suppliers last month and exposed serious flaws in the country’s highly competitive online economy.
At least 22 of the 150 incidents recorded on CLB’s Strike Map in May were directly related to the bankruptcy of the Apple Group and Yihao Jiaju (一号家居) at the end of April. In many cases, it was the customers who had lost substantial deposits who were the most vocal protesters but the demonstrations were remarkably inclusive with everybody understanding they had been the victim of an overly aggressive business model.
Much like the share bike market, which saw dozens of business failures last year, online interior design platforms grew rapidly in China with little or no regulation, creating an ultra-competitive market in which business owners sought to establish dominance by expanding as quickly as possible. This of course was a very fragile business model and it took just one crack in the capital flow chain for the whole edifice to collapse.
See below for a brief summary of some of the protests at stores owned by the Apple Group and Yihao Jiaju.
Finally, a reminder that if you no longer wish to receive this newsletter please unsubscribe using the link below or send us an email to email@example.com and we will make sure your information is deleted from our database.