Heytea capitalizes on the hype around Apple Headquarters; its stores in 10 Chinese cities are to be sold
Interim Reports: A Barometer for Peering into the Second-Half Fate of Listed Companies and Even Industries
At the start of 2025, the grand scene of Trump’s return to the White House was still fresh in people’s minds, yet no one anticipated that the fate of some cross-border enterprises had already been foreshadowed by then.
Recently, as the financial reports of major listed cross-border e-commerce enterprises have been released one after another, a chilling picture has emerged: Zeshang Technology, once known as the "first cross-border stock on the New Third Board," has seen its revenue plummet to zero; Chenbei Technology, which achieved 650 million US dollars in revenue last year, has withdrawn from the market in disappointment this year; even Youshu, once a high-flyer in the industry, is now hanging by a thread...
All of this is closely linked to the volatility of global trade policies, which have led to an increasingly fragile global supply chain and rising logistics costs. Starting from March 4, the United States imposed an additional 10% tariff on Chinese goods exported to the US citing the fentanyl issue. Combined with the "reciprocal tariffs" implemented in April, the comprehensive tax rate on Chinese goods reached 54%, and for some products, it further rose to 104% on April 10. The latest policy that took effect on August 7 even included 69 countries or regions in the tariff adjustment scope, with tax rates ranging from 10% to 41%.
These tariff policies exhibit three key characteristics: First, targeted crackdowns coexist with designated exemptions. High-tech products such as smartphones, computers, and chips can be exempted by declaring under tariff code 9903.01.32, while traditional categories like clothing and home furnishings are fully under pressure. Second, the tariff superimposition effect is significant. Basic tariffs, reciprocal tariffs, and punitive tariffs form a "tax pyramid," with Chinese sellers bearing an average of 3 to 4 layers of tariffs. Third, policy volatility has increased. There have been 7 adjustments since the beginning of 2025, with the shortest window for a single policy being only 5 days, requiring enterprises to respond more quickly.
The cost pressure brought by policy adjustments is undoubtedly fatal. However, more importantly, the "immunity" of these cross-border enterprises has severely deteriorated over the past few years, leaving them vulnerable to collapse at the first sign of adversity. What profound lessons and insights can their downfall offer to current cross-border e-commerce enterprises?
01. "First Cross-Border Stock" Sees Revenue Plummet to Zero!
Recently, Zeshang Technology released its financial report, showing that from 2024 to the first half of 2025, the company’s operating revenue was zero, its core cross-border e-commerce business has completely ceased operations, its ability to continue operations is facing significant uncertainty, and it is now at risk of delisting.
According to data, Zeshang Technology was founded in 2009 and listed on the New Third Board (China National Equities Exchange and Quotations) in 2015, earning the title of the "first cross-border stock on the New Third Board." Its brand CHOIES, with its unique fashion style and extreme cost-effectiveness (priced at 10-40 US dollars), successfully entered over 100 countries and regions in North America, Europe, the Middle East, and beyond. Its flagship site CHOIES.com is an independent fast-fashion brand site, on par with Zaful under Global Easy Buy.
Since Zeshang Technology relied on China’s flexible supply chain and focused on building its self-operated independent site CHOIES—a development model quite similar to SHEIN—the two were often compared in the industry in previous years, with Zeshang once known as the "East China version of SHEIN."
Caption: Screenshot of CHOIES official website
However, its glory was short-lived. Starting from 2017, as market competition intensified and platform policies tightened, CHOIES gradually fell behind in product innovation and supply chain response speed, failing to build a brand moat, and its growth momentum slowed down.
Also starting from 2017, Zeshang Technology began to incur losses, with a loss of 4 million yuan that year. In the subsequent period from 2018 to 2022, except for a profit in 2019, it suffered losses in all other years: 18.26 million yuan, 7.31 million yuan, 3.1 million yuan, and 10.31 million yuan respectively.
During this period, the company’s sales expenses continued to rise. In 2020, sales expenses reached as high as 202 million yuan, accounting for 67.98% of operating revenue. According to this ratio, for every 10 yuan earned from sales, 7 yuan was spent on marketing—seriously eroding profit margins.
Notably, while "user acquisition costs" kept rising, conversion rates kept falling. Data reports show that the traffic costs of mainstream e-commerce platforms have increased by 47% compared with 2023, while the overall online conversion rate has dropped by 0.6 percentage points.
In September 2023, factors such as equity transfers and changes in actual controllers became the "last straw that broke the camel’s back." Frequent strategic adjustments and management changes led to a lack of continuity and stability in the company’s business, ultimately causing a significant decline in team morale and execution—with a large number of employees leaving. As of June 30, 2025, only 2 employees remained in the company.
Zeshang Technology’s continuous losses and eventual collapse were not only affected by the broader environment but also due to its own strategic mistakes.
According to its annual financial reports, external influencing factors include: the increasingly fierce competition in the cross-border e-commerce industry, prominent product homogeneity; rising raw material costs and subsequent increases in various production factor costs, squeezing profits; soaring traffic costs and declining conversion rates; and fluctuating tariffs.
A cross-border seller specializing in clothing told Xiaguang Society that if the tariff on clothing exported to the US increases by an additional 24% on top of the existing 30%, the gross profit margin will directly drop from 35% to 18%. This forces enterprises to either bear the profit shrinkage or increase prices by more than 20%—which would cause them to lose competitiveness among price-sensitive consumers.
At the same time, logistics and capital chain pressures have increased exponentially. "Sellers using the traditional direct shipping model not only have to bear the increased costs from tariff hikes but also the costs caused by longer logistics cycles. Previously, the average customs clearance time was 3 days, but now it has been extended to 7-14 days, and the inspection rate has risen from 5% to 23%," the seller revealed.
Internal influencing factors, on the other hand, include Zeshang Technology’s own operational strategy issues, misplaced investment priorities, and blind belief in user acquisition strategies.
Today, Zeshang Technology has announced a comprehensive transformation, gradually shifting its core business from clothing trade, computer software and hardware, and electronic product technology development to the new energy industry (mainly providing core component processing and manufacturing for the hydrogen equipment industry chain), leaving the cross-border e-commerce track that once brought it glory.
02. 650 Million US Dollars in Revenue Last Year, Delisted from Hong Kong Stock Exchange This Year
Zeshang Technology is not an isolated case.
On May 7, 2025, Chenbei Technology officially delisted from the Hong Kong Stock Exchange, terminating stock trading. This enterprise, which focuses on cross-border e-commerce of small household appliances, only lasted three years from listing to delisting, setting the record for the "shortest-lived" cross-border e-commerce enterprise on the Hong Kong Stock Exchange.
Chenbei Technology still expressed a hint of helplessness regarding its delisting. "Since the start of 2025, we have faced many challenges, including tense geopolitical situations and escalating tariff barriers... The changing market environment and additional tariffs are certainly pressures for us, but they are also competitive barriers—it all depends on whether we can adapt to environmental changes," the company stated bluntly in its 2024 annual report.
Public data shows that Chenbei Technology was founded in 2011 and focuses on the R&D, production, and sales of smart home devices and small smart household appliances. Its products mainly target global markets such as North America, Europe, and Asia. The company owns several well-known brands, including Levoit (home environment brand), Cosori (kitchen appliance brand), Etekcity (smart health device brand), and Pawsync (smart pet device brand).
Financial reports show that in 2024, Chenbei Technology’s operating revenue reached 652 million US dollars, a year-on-year increase of 11.5%, and its net profit attributable to the parent company was 93 million US dollars, a year-on-year increase of 20.1%.
Beneath this impressive growth rate, however, hidden risks lurked. Over the past few years, Chenbei Technology’s net profit has fluctuated significantly. This unstable performance has raised concerns among investors, leading to a long-term price-to-earnings ratio (P/E ratio) of less than 10 times for Chenbei Technology, and even instances of zero trading volume.
Furthermore, an analysis of Chenbei Technology’s performance structure reveals its heavy reliance on the North American market. In 2024, North America contributed 480 million US dollars in revenue, accounting for 73.6% of total revenue. With the Trump administration’s implementation of high tariff policies, expanding into the US market has become a "Sword of Damocles" hanging over Chenbei Technology.
Source: Chenbei Technology 2024 Annual Report
In May 2025, the US terminated the T86 small-value exemption policy. Although China and the US later announced a reduction in some tariffs, policy volatility and reversals still pose significant challenges to cross-border enterprises. Taking the kitchen appliance brand Cosori as an example, its sales in the North American market account for over 60% of its total sales. If tariffs are increased, its profit margin may be reduced by 5-8 percentage points.
At the same time, compliance requirements in different regions around the world are also among Chenbei Technology’s considerations for delisting. The EU’s Digital Markets Act imposes requirements on data localization, and California’s Consumer Privacy Act has strict regulations on user data protection. Enterprises have to invest huge sums of money to meet compliance standards.
Industry insiders point out that after delisting, Chenbei Technology will face lower information disclosure requirements and can arrange its overseas market layout more flexibly to cope with policy risks such as tariffs, compliance, and patents.
03. Even a 10-Billion-Yuan Market Value Can’t Withstand a "Ban" from Giants
The story of Youshu is even more lamentable. Founded in 2008, this cross-border e-commerce enterprise listed on the A-share market by backdoor listing through Tianze Information, and its market value once exceeded 1 billion yuan, making it an industry leader.
At its peak, Youshu’s business covered over 200 countries and regions worldwide, with more than 1 million SKUs (stock keeping units). It had over 900 stores on Amazon alone, and its annual revenue reached a maximum of 5 billion yuan.
However, this "reselling" - style of reckless growth suffered a fatal blow during Amazon’s "account ban wave" in 2021, when 284 of Youshu’s stores were shut down. Affected by this incident, over 100 million yuan of Youshu’s store funds were also frozen. In response to an inquiry from the Shenzhen Stock Exchange, Youshu admitted that "the company’s overall financial situation is deteriorating day by day, the transformation to branding has been severely hindered, and no iconic cross-border brand has been established yet."
It was also in that year that the company’s revenue plummeted from 5.027 billion yuan in 2020 to 1.764 billion yuan, entering a vicious cycle of "continuous decline." From 2020 to 2023, the cumulative loss reached 4.4 billion yuan.
Caption: Screenshot of Youshu official website
In addition to the "account ban" incident, Youshu’s own business model also accelerated its losses.
The "cast a wide net to catch more fish" distribution model was the magic weapon for Youshu’s rise, but it also laid hidden dangers. As inventory scale continued to expand, Youshu’s capital turnover efficiency declined steadily. According to its 2022 annual report, the company’s inventory turnover days reached over 151 days, far higher than the industry’s healthy level (usually 30-60 days). This means that most of the company’s funds were tied up in inventory. Once sales stagnated, a cash flow crisis would immediately occur. Moreover, for Youshu, which mainly sells clothing, consumer preferences change in multiple dimensions. An inventory cycle of up to 5 months means that the company is still selling products from the previous quarter in the current quarter—one can imagine the pressure on the sales side.
Ironically, when the company’s operations were mired in a quagmire, the three founders of Youshu reduced their shareholding from 100% to 1.23%, accurately cashing out 2.1 billion yuan and exiting. What was left behind was suspicion of fictitious revenue (96.64% provision for bad debts on accounts receivable), a black hole of fund occupation (over 95 million yuan occupied by two former actual controllers), and an emptied shell.
Finally, in February 2024, Youshu’s creditors filed for bankruptcy reorganization with the court, and a "Rosemary’s Baby" - style equity dispute began.
On May 8 this year, a dramatic scene occurred in the announcement released by ST Youshu: the newly appointed largest shareholder proposed an early reshuffle of the board of directors, but was collectively opposed by 7 current directors.
A month later, on June 20, the shareholder infighting spread to the annual general meeting. The camp of major shareholder Wang Wei, together with multiple shareholders holding more than 3% of the shares, submitted an interim proposal: to hold an early election for the 7th board of directors, nominate 7 candidates from Wang Wei’s camp to take full control; and dismiss all 7 directors from Xiao Siqing’s camp, directly accusing them of "failing to perform their duties diligently."
With external pressures and internal "palace struggles," Youshu is facing a double whammy. The "account ban wave" directly exposed the fatal flaw of the distribution model—it is difficult to accumulate loyal users and is too dependent on platforms. A little turbulence outside can almost bring the company to its knees.
04. More cross-border enterprises have encountered setbacks in the past two years
Beyond the successive delistings of Chenbei Technology, Zeshang Technology, and Youshu, more cross-border enterprises have encountered setbacks in the past two years.
Earlier, Linkage Interactive, the parent company of Newegg, officially suspended trading and delisted; Baoxin Global, a major cross-border home furnishing seller, also delisted from the New Third Board; MuJia Home Furnishing, a major Amazon seller, terminated its stock listing after two consecutive years of losses; Huading Co., Ltd. sold its cross-border business Tongtuo Technology for 700 million yuan—far less than the 2.9 billion yuan acquisition price at that time.
In addition to listed enterprises, some cross-border e-commerce enterprises preparing for listing have also withdrawn their applications one after another. According to incomplete statistics, a number of well-known enterprises, including Xiamen Dong’ang Technology, Weibang Sports Technology, Ruilian Technology, Jingchuang Technology, and Pinsheng Technology, have terminated their IPO (Initial Public Offering) or acquisition plans.
The downfall of these cross-border e-commerce leaders marks the end of the era of extensive growth in cross-border e-commerce and the beginning of the era of refined operations starting from 2025.
Changes in the broader environment are accelerators for industry reshuffling. Changes in the global trade environment, tightened platform policies, and rising traffic costs—these external factors together constitute a "storm" in the cross-border e-commerce industry. However, it should be noted that these external changes tend to eliminate enterprises with inherent flaws; truly healthy enterprises can survive the storm.
From the three typical cases in this article, it can be seen that internal strategic mistakes are the root cause of failure. Each of these enterprises’ failures was marked by obvious strategic errors: Chenbei Technology’s over-reliance on a single market, Zeshang Technology’s excessive belief in user acquisition, and Youshu’s chaotic compliance management. These problems may be concealed by growth when enterprises are in a favorable environment, but they will be exposed once the environment changes.
This wave of delistings leaves not only the "tombstones" of enterprises but also a milestone for the industry to move toward maturity. For cross-border e-commerce practitioners, this is both the worst of times and the best of times—reckless growers are exiting the stage, and enterprises with real competitiveness will gain greater development space.
References
[1] 2025 H1 Cross-Border E-Commerce Industry Report, AMZ123
[2] 2024 Global Cross-Border E-Commerce Consumer Survey Report, International Post Corporation
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