Survival is not easy! A well-known export supplier in Shenzhen announced its dissolution, and the former large factory with 10,000 employees collapsed!

This year is extremely cold, and how to survive has become a difficult problem that every company cannot avoid.

According to online news reports in recent days , another announcement of the dissolution of an export trading company has been widely circulated in the circle of friends of cross-border e-commerce people. As a well-known old company with decades of operation, its ending has also caused many people in the industry to sigh.

The company that announced its closure is the well-known electrical appliance manufacturer - Willima Electrical Appliance Manufacturing (Shenzhen) Co., Ltd.

The announcement shows that due to the losses in the past few years and the lack of new orders, the company's business is currently stagnant, and the company's shareholders have decided to dissolve the company on August 31.

The company showed great humanity in employee compensation. The company said it would pay compensation to employees who joined the company after 2008 in accordance with the law, which should be expressed as N+1, which is the way the employer terminates the labor contract.

At the same time, employees who joined the company before 2008 will have the opportunity to obtain more financial compensation, and employees who sign the agreement in advance on the 29th or 30th will receive cash rewards.

According to public information, Shenzhen Weilima is an old factory with a history of about 40 years , mainly engaged in the manufacturing of household appliances and small household appliances.

At its peak, the company had more than 2,000 employees and produced more than 20,000 electric irons per day , with an annual output of about 10 million pieces . Its products were exported to more than 50 countries around the world, including the United States, Germany, the United Kingdom, Canada, Japan, South Korea , etc.

The company's founder, Cai Longwei, was once the "King of Hong Kong Home Appliances". Optimistic about the prospects of small home appliances, he invested in and established five factories in the mainland. However, as the brand influence was not as strong as those in Europe, the United States, Japan and South Korea, and the cost-effectiveness was not as good as local brands, all five factories have now been closed.

On almost the same date, a well-known old factory in Dongguan, Aigo Electric, also issued a notice of closure and announced the termination of labor contracts with all employees.

Its closure notice stated that because the company has invested heavily in its transformation to new products in recent years, and the outbreak of the COVID-19 pandemic has had a huge impact on export-oriented companies, the company has suffered serious losses for many consecutive years and is struggling to continue.

Although the company's management tried every possible way to seek support from various parties and struggled for several months, it still could not reverse the decline. The company has completely stopped production and business.

In terms of employee compensation, the factory specifically mentioned that employee dormitories can be accommodated until September 7, 2022.

It is understood that this factory is also a well-established factory with a history of 30 to 40 years. At its peak, the number of employees even reached more than 20,000, and it was once one of the most important DVD and audio manufacturers in Dongguan. Faced with the changes of the times, the factory also tried to transform and make laptops, tablets and bicycles.

However, under the impact of the continuous upgrading of smartphones, sales of tablet computers and laptops have also been difficult to break through. Since then, revenue has begun to decline and even losses have begun to occur.

In recent years, affected by many factors such as the epidemic, chip shortages, and rising prices of components, Aigo's operations have become increasingly difficult.

Looking back at the experiences of these two companies, they have similar development processes:

On the one hand, the same old factories that have been established for many years have achieved good results in the period of adapting to the development of the times. However, in the stage of changing times and technological upgrading, they failed to seize the opportunity of transformation in time , and their performance began to decline, and even years of losses were difficult to reverse;

On the other hand, both companies are factories engaged in export and foreign trade. Due to the impact of the epidemic in recent years , domestic epidemic prevention has been strictly controlled, and demand for foreign orders has declined . The companies have lacked sources of income, which has accelerated their pace of bankruptcy.

The current situation of foreign trade factories is also a mirror for many foreign trade people and cross-border people. At present, the entire cross-border e-commerce industry, both upstream and downstream, is facing considerable difficulties.

When cross-border e-commerce took off, all companies in the industry chain invested heavily. Importers, cross-border sellers and brand companies increased their leverage through financing, and suppliers at all levels also advanced large amounts of money to accelerate production. When growth could not be sustained, when overseas demand declined, sellers and brands were banned by the platform, and companies at every level were hurt.

According to incomplete statistics, more than 1,000 factories in the cross-border e-commerce industry alone went bankrupt in April 2022, and by May, nearly 3,000 factories had closed down . It is estimated that a total of 4,000 to 5,000 factories have closed down.

Although the industry has encountered huge challenges, overall, the export industry still maintains its growth momentum . Data shows that in the first seven months of this year, China's total import and export of goods was 23.6 trillion yuan, a year-on-year increase of 10.4%, and exports were 13.37 trillion yuan, an increase of 14.7%.

Ps: The content of this article is compiled by the Foreign Trade Cross-border Research Center and Foreign Cross-border E-commerce Cross-border House, Haixi.com, Hugo.com, etc. Please indicate the source when reprinting.