The micro-business empire collapsed, and agents became "cannon fodder": tens of thousands of IQ taxes were paid, and they hoarded goods that could not be used up for a lifetime

Source of this article: Times Finance Author: Xu Xiaoqian

Editor's note: When we talk about "good consumption," what are we talking about? The significance of the existence of the annual 315 International Consumer Rights Day is to strive to restore the original appearance of "good consumption". This March, Time Media's Consumer Report, Times Weekly, Times Finance, and New Weekly jointly launched the "HAO Consumption" feature to focus on your consumer life

Image source: Visual China

2022 is a turning point for a generation of micro-business empires, and several once brilliant groups are collapsing.

Gong Wenxiang, known as the "godfather of micro-business", announced his official withdrawal from the micro-business industry. He said that after being jointly investigated and punished by the special case teams such as the Industrial and Commercial Taxation Public Security Court, he "went bankrupt, sold houses and cars, and was penniless." The company of "micro-business godmother" Zhang Ting was also officially stamped as "suspected pyramid scheme", and the TST Ting secret series products raised by Zhang Ting and his wife were thus covered with a layer of ashes.

Times Finance found that after the decline of the micro-business brand, the agent became commercial cannon fodder, and the tens of thousands of yuan of goods hoarded had to open the fire sale mode. At the same time, more and more entrants trapped in the "sugar-coated shells" are gradually waking up and drawing the final footnote for the era of micro-business.

After two years in the industry, the 1800 yuan franchise fee has not been returned

In 2019, Zhang Jing, who had just stepped into the university campus, became an agent of a micro-business skin care product under the persuasion of friends. In order to get the quota of the third-level agent, she paid 1800 yuan for the entrance ticket.

"Watching others do agency promotion, casually sending a circle of friends for a few minutes can reach the account of hundreds of yuan, and then I was moved."

The key to weChat group's solicitation of downlines is the temptation of wealth. "When you hesitate, someone else has already acted." Inspiring copywriting in the circle of friends ignited the enthusiasm of entrepreneurs. Through the team layer by layer packaging, the once ordinary mother can easily earn 300,000 yuan a month, and a luxury car is the standard in the circle, and the storyline of overnight wealth has attracted a group of members.

According to the data released by the Internet Society of China, in the three years from 2015 to 2017, the number of employees in the domestic micro-business industry was 12.57 million, 15.35 million, and 20.18 million, and continued to increase.

Zhang Jing has to buy goods from the superior agent every other month, and the minimum price of the products with peculiar effects she shows in the circle of friends is more than 200 yuan, but the price of her purchase from the superior agent is generally only 30 yuan. "Under normal circumstances, the purchase price of agents one level higher than me is 10%-15% lower, so the price of large agents will only be lower, and the cost of a set of water milk is less than 10 yuan."

Like most low-level agents, Zhang Jing often suffers from products that cannot be sold. The single amount in the early stage can still be converted by friends and relatives, but the repurchase rate of the product is very low, and it is difficult to expect viral transmission. "At the beginning, I opened a single once a week, but then I couldn't digest it, so I could only give it to others."

Once the long-term performance volume is at the bottom, the team will persuade the agents to do the upgrade service: either by pulling down the line to earn commissions, or spend money to upgrade to a higher level of agents. Zhang Jing had to face these two choices, her superior agent had to pay an entry fee of 5,000 yuan, while the top agent's fee was more than 10,000 yuan. Under multiple considerations, Zhang Jing increased her stockpiling efforts to become a higher-level agent, upgrading from 500 yuan per month to 1,000 yuan.

In fact, just when Zhang Jing joined the ranks of micro-businessmen, the entire industry began to decline. On January 1, 2019, the E-commerce Law of the People's Republic of China was officially implemented, and micro-businesses were included in the category of e-commerce operators, and if they want to continue to operate, they need to apply for a self-employed business license or a company business license.

At the end of last year, Zhang Jing silently withdrew from micro-business, and the 1800 yuan she paid for joining the association at that time had not been recovered. In order to have beautiful performance data, the downlines developed by her have also withdrawn from the stage of micro-business.

Hoarding 50,000 yuan, low-priced sale can not find the receiver

As TST Ting secretly stood on the cusp of the storm, Zhang Ting and his business empire were also dragged into a desperate situation.

A batch of small and medium-sized agents are busy dumping goods on major platforms, the original price of 168 yuan of bird's nest mask only sold for 65 yuan, and the explosive single product water milk set dropped from the original price of 500 yuan to more than 300 yuan.

In order to reach a higher position, Huang Wei's hoarded Ting Secret series of products filled an entire shelf. "At least 50,000 yuan or more of goods, can not be used up in a lifetime!" Now all of them are sold at a loss, only two or three people have placed orders for several months, and some of them have expired in October this year, otherwise they will be treated as waste. ”

Five years ago, Huang Wei did not expect that the once fragrant food products would fall to the point of being sold cheaply on the whole network, and she had become a harvested party.

Before the TST court secretly and publicly fell into the pyramid scheme storm, Huang Wei rarely doubted its formality, and she firmly believed that there would be no problem with a bunch of star-endorsed products.

At the beginning of 2019, Darway Trading Co., Ltd., operated by Mr. and Mrs. Zhang Ting, was listed on the "List of Top 100 Excellent Enterprises in Qingpu District, Shanghai", with a tax payment of about 2.1 billion yuan, to pressure Zhongtong, Shentong and other enterprises, and won the highest tax award in Qingpu District, and the brilliant achievements of the parent company once again supported the wealth ambitions of many agents.

After the secret collapse of the TST court, the social accounts of Zhang Ting and Lin Ruiyang were still in a state of silence, and the Zhang Ting live broadcast room, which had set the first sales of Douyin live broadcast, was also suspended.

The star effect was lost, the product heat also began to cool down, and the offline activities that agents dreamed of sharing the stage with the stars were terminated. Zhang Ting once threw 60,000 yuan to give a watch to an agent. "This may be a big goal for a lot of people to join the court secret, who doesn't want to be a star's friend and squeeze into a high-end year-end party?" Huang Wei said to Times Finance.

Although there are still secret series products on major e-commerce platforms, the sales myth is difficult to reproduce, and the monthly sales of explosive products in a brand store are less than 100.

However, Times Finance found that the TST court secretly is still recruiting agents. A recruiter showed the performance requirements of the agent to Times Finance, the highest level of agent monthly sales of more than 250,000 yuan, can get 32% commission; the lowest level of agent monthly sales of less than 1200 yuan, the rebate ratio is as high as 12%.

According to the recruiter, the TST court's secret agent does not need to pay the membership fee, and the premise of opening the card is to provide personal name, mobile phone and bank account number.

"You can't make any money doing this." A number of secret agents interviewed told Times Finance. There are also doubts about the safety of product ingredients and extremely low harvesting costs, but superior agents will continue to convince them that "huge profits are common to the cosmetics industry".

In addition to the agents trapped in the difficulty of changing hands on products, the secret consumers have also become "slaughtered lambs" in the MLM chain. After falling into the haze of pyramid schemes, the black cat complaint platform had consumers reflect the abnormal delivery on the platform. "There is no manual customer service after placing an order, there is no single number, the phone is not answered, and the refund cannot be processed." "The return was processed for half a month without any progress."

As early as 2016, some consumers said that after using Ting's secret live yeast products, "bad face", Zhang Ting pointed the spearhead at consumers in his response, believing that individual consumers' own physiques were incompatible with the product. However, the risk of "bad face" never stops, with more and more agents using more novel terms "building tolerance" to explain allergic reactions to products.

WeChat banning, user dislike, is there still a tomorrow for WeChat?

The shadow of the alleged pyramid scheme did not make the micro-business empire disappear.

On February 15, Mr. and Mrs. Zhang Ting set up a new company. According to the investigation, Shanghai Shengsheng Ii Technology Co., Ltd. was registered and established with a registered capital of 30 million yuan, the chairman is Lin Jirong (Lin Ruiyang), the major shareholder is Shanghai Tingran Science and Technology Development Co., Ltd. (hereinafter referred to as "Tingran"), the shareholding ratio is 55.7%, and Zhang Shuqin (Zhang Ting) is the legal representative of Tingran.

Whether Zhang Ting and his wife plan to make a comeback again is unknown, but the micro-business group that has developed and grown up relying on the WeChat ecology and the circle of acquaintances has reached a transformation point. Some of them have shifted from reckless to formal, such as Fan Milin or McGilli, who have been mixed in the jianghu with the marketing links of micro-business, and are now being corrected one by one, naming the ace programs of each David TV, and inviting first-line stars to sit in the endorsement.

However, for the vast majority of micro-business brands, leaving the market is their ultimate fate.

In 2014, Mengjie became the earliest batch of entrants to micro-business, and once developed nearly 20 agents during the peak period. At that time, the number of WeChat users exceeded 600 million, and it was also the social software with the widest coverage area in the sinking market.

Mengjie admitted to Times Finance, "When the business is the best, the daily order volume is 30-40, and it is not difficult for the monthly sales to break 1,000, the average monthly flow can reach 40,000 yuan, and the consulting business alone is busy. ”

In less than two years, Mengjie found that the WeChat ecology fell into a state of fatigue. "Who wants to buy something on WeChat now?" When the registered salary gradually shrank from the original 20,000 yuan to less than 10,000 yuan, Mengjie withdrew from the tide of micro-business.

On the other hand, several revisions of WeChat are also constantly tightening the permissions of WeChat. In January this year, WeChat upgraded the folding function of the circle of friends, folding large paragraphs of text and similar copywriting and pictures, which undoubtedly refers to the promotion routine of micro-business nine palace grids and copy copywriting.

The network of relationships that micro-businessmen are proud of has also become a backwater. Just when the micro-businessmen tirelessly forwarded the full score template, the users who were tired of the circle of friends being swiped also closed the promotion channel of the micro-business in one direction.

Zhang Jing is still studying the Internet "Blue Ocean" project, "Now a lot of micro-business armies have begun to go to Douyin to pan for gold." "But they're hard to predict whether the old routine of continuing to count people's heads and circles of money is a wealth proverb or another trap."

(The interviewees in this article are pseudonyms)