The Daily Fresh Building in Wangjing Small Street has been empty. On August 22, a reporter from Beijing Business Daily visited and found that the company's address shown in the daily fresh financial report was difficult to find, and the property agent was soliciting rents. According to the property agent, Daily Fresh still owes it a total of about one million yuan in rent for more than three months. At the same time, the reporter interviewed the internal staff of Daily Youxian and learned that one year after the lightning explosion, since July this year, the executives of Daily Youxian have been in a state of disappearance, and some of the remaining employees have also left one after another. At present, Daily Fresh is seeking digital transformation, but after abandoning its main business, it is difficult to say whether Daily Fresh will be revived or acquired after abandoning its main business and losing more than 99% of its market value.
Executives have disappeared, and the headquarters has been rented out
Building A of Vanke Times Center, Wangjing Street, Chaoyang District, Beijing, was once the office headquarters of Daily Youxian. On August 22, a reporter from Beijing Business Daily visited the site and saw that the rose-red door sign of "Daily Fresh" at the entrance of the building had been removed, the second and fifth floors had been leased out, and the third and fourth floors were currently being leased.
"At its peak, this building accommodates nearly 2,000 employees every day." According to the relevant staff of Beijing Yuanxing Real Estate Brokerage Co., Ltd., the property leasing agent of the building, Daily Youxian reached a five-year fixed contract with it in 2021, and after moving into the building in the second half of 2021, Daily Youxian Company exclusively occupied all floors of the office building.
"In the middle of last year, Daily Youxian moved to a single house of more than 2,000 square meters near the departure of Shunyi Greenland, and the company exploded before the decoration was completed, and later moved to a nearby office of about 200 square meters." The above-mentioned staff said that after the end of this year, Daily Youxian completely moved from Building A of Vanke Times Center, and owed a total of millions of yuan in rent for more than three months.
In the latest financial report for 2022 released by Daily Youxian in August this year, a reporter from Beijing Business Daily saw that its office address was still written in Vanke Times Center located in Wangjing Small Street.
Wan Ying (pseudonym) worked for Daily Fresh for more than a year and left in the middle of this year. According to him, in June and July this year, the executives of Daily Youxian appeared to be "out of contact", "After the company's lightning explosion last year, the president and others were still in contact, and I have been helping them deal with some cooperation matters." It wasn't until June or July that executives completely lost contact. Now, together with procurement reimbursement and arrears of wages and compensation, Daily Fresh owes me a total of more than 200,000 yuan."
Wan Ying said that compared with the amount owed to the supplier, the above amount is still a small amount. "At present, the few suppliers I connect with alone have nearly one million yuan in arrears in the hands of Daily Fresh, and there has been no progress from last year to this year." Wan Ying said helplessly.
"From the end of 2022, the above (Daily Fresh executive) always said, 'It's good to finish the New Year'." Wan Ying said that many employees like him have survived the New Year because of this sentence. But in fact, until July this year, Daily Fresh did not wait for any financing, and the promise eventually became an empty phrase.
In June this year, after not being able to contact the VP (vice president), Wan Ying still chose to leave. "Now there should only be a few people in the finance and financing department left in the entire daily fresh, and there are no other employees." Wan Ying said.
Throw nearly half of the "life-saving money" and transform the digital marketing map to survive
At the beginning of August this year, Daily Youxian finally waited for a "life-saving money". In the announcement issued by Daily Fresh, the company signed two share purchase agreements with two investment institutions, which will subscribe for a total of 5.4 billion Daily Fresh Class B ordinary shares at a cost of US$27 million, or approximately RMB 194 million. According to the announcement, the investors were "Vigorous Global Capital Inc." and "HF (China) Business Management Co., Limited", which subscribed for a total of 5.4 billion shares of Daily Fresh Daily, accounting for 88.1% of the total number of shares issued by Daily Fresh Daily.
According to the financing announcement, the two investors have agreed to transfer all the corresponding voting rights of these shares to Xu Zheng, chairman and CEO of Daily Fresh. According to the data released by the financial report, as of June 30, 2023, the largest shareholder of Daily Fresh was "Freshking Limited", holding 68.89 million ordinary shares of Daily Fresh with a shareholding ratio of 9.4%. And Xu Zheng is precisely the only director of the company.
However, Daily Youxian, which has received an investment of 194 million yuan, does not seem to be able to breathe. According to the 2022 financial report data released by Daily Fresh in August, as of December 31, 2022, the cash and cash equivalents and restricted cash held by Daily Fresh were 48.96 million yuan. During the same period, Daily Fresh had accounts payable of $1.3 billion. In the earnings report, Daily Fresh said that the company is currently planning a debt restructuring, but there is no guarantee that the potential debt restructuring will be completed if or when.
Under such circumstances, the front foot received a $27 million financing from Daily Fresh, and the back foot spent nearly half of the financing to purchase all of the common shares of "Mejoy Infinite Limited" held by its shareholders for $12 million in cash. According to the official announcement, "Mejoy Infinite Limited", founded in 2018, is a digital marketing solution provider incorporated in Hong Kong, focusing on overseas advertisers such as service tools, games and cross-border e-commerce. Daily Fresh said that after completing the share purchase business acquisition agreement, the company will begin to provide customized digital marketing solutions and services.
In the view of Zhuang Shuai, an expert in the retail e-commerce industry and founder of Bailian Consulting, it is not unexpected that Daily Fresh chose the transformation direction of digital marketing, "The choice of digital marketing direction is because the rapid development of Daily Fresh relies on digital marketing, so it has deep accumulation in the team, experience and methodology." In fact, Xu Zheng, who graduated from the Department of Mathematics at the University of Science and Technology of China, has always attached great importance to data. According to Daily People, for a long time, his circle of friends signatures were "data-driven."
"As a third-party service industry, the digital marketing business industry is very fragmented, although fierce, but the market space is large, and it is asset-light, the investment is small and easy to profit, which is a good choice for Daily Fresh." Zhuang Shuai said.
Profit or luxury, the fresh food circle is difficult to tolerate?
Although the market prospects are not bad, for Daily Fresh, whether it can regain the trust of investors depends on the actual landing of the follow-up business.
According to the data disclosed in the financial report, the business situation of Daily Fresh in recent years is not optimistic. According to the daily fresh financial report data, the company's revenue in 2019-2021 was 6.00 billion yuan, 6.13 billion yuan and 6.95 billion yuan respectively; The net loss was RMB2.909 billion, RMB1.649 billion and RMB3.85 billion respectively. By 2022, Daily Youxian's revenue in 2022 plummeted to 2.76 billion yuan, a year-on-year decrease of more than 60%. At the same time, the net loss of Daily Fresh in 2022 reached 1.52 billion yuan, and the total current liabilities were 1.68 billion yuan.
It is worth mentioning that before the thunderstorm in 2022, the daily fresh with worrying performance has begun to try to transform. In addition to the front warehouse, Daily Fresh also began to deploy offline "smart vegetable farms" in 2021, according to the business introduction, the "smart vegetable market" business includes obtaining the right to operate the vegetable market, operating the vegetable market and carrying out digital transformation, and connecting the offline business of the traditional vegetable market to the online. According to officials, through the "smart vegetable farm" business, the company can collect rent, platform service fees and commissions according to the GMV of the merchant's e-commerce business.
However, in March this year, Daily Fresh completely terminated its smart fresh market business and retail cloud business. At this point, the second growth curve of Daily Fresh with high hopes has also stalled.
"The market for third-party digital marketing is large, but the competition is also fierce, so it is important to find a differentiating advantage." In addition, Zhuang Shuai said that compared with the heavy asset investment of the front warehouse, in terms of cost, it is easier to control the cost of light assets such as digital marketing. "For example, if you set up a digital marketing team of 10 or fewer people and serve brand merchants or traditional retailers on JD.com, Tmall, and Douyin platforms, you can have income."
"By June and July of this year, there were only a few people left in the company who were involved in finance and financing-related business." Wan Ying revealed that Xu Zheng's "inaction" also made many employees feel helpless. "If you owe money, you owe money, but you don't even give a minimum attitude, and Xu Zheng's reputation in the fresh circle is very poor." Wan Ying told the Beijing Business Daily reporter that after leaving Daily Youxian, many colleagues around her have gone to other platforms with fresh food business, such as Dingdong to buy vegetables and Meituan. "I myself am currently supplying fresh food business to JD.com, Hema and other related platforms."
"For Daily Fresh, it is possible to continue to exist in the market in the future through a 'small but beautiful' approach, but it may also be acquired." Zhuang Shuai said. According to Wande stock data, up to now, the daily quotation of fresh food is $1.14 per share, with a total market value of $9.2831 million, which is down 99% from the market value of $3.2 billion at the time of IPO.
In response to the change of office address mentioned in the article and the problems mentioned by Wan Ying, such as arrears, missing executives, and arrears of property fees, a reporter from Beijing Business Daily has sent an interview outline to Wan Ying through the email address in the daily fresh financial report, but has not received a response as of press time.
Beijing Business Daily reporter He Qian Qiao Xinyi