Founded in 2013, Pinpin PICOOC is one of the earliest start-up companies to become smart hardware. Its first body fat scale became a detonation model, and it continuously obtained three rounds of financing in one year (including 2014 6 Tencent and Jingdong’s $21 million B round investment, and PICOOC has become a star startup company in the technology circle.
However, there was a sudden news that PICOOC was being collected by several suppliers and each of them owed a few million yuan. This has caused a lot of heated debate in the industry. Afterwards, PICOOC CEO Zhang Yue WeChat rumored that its supplier Shenzhen Weilong Technology Co., Ltd. had a lot of quality problems and delayed delivery problems, which caused PICOOCC's production capacity to be affected and caused major losses, and the two parties did not reconcile their accounts. In the case of the supplier, the supplier began to invoice the dunning.
Of course, this is not the end. Zhang Yue’s response has been questioned by many insiders. In the end, what's wrong? We might as well listen to what Weilong Technology is saying.
Lei Fengnet came to Weilong Technology Office today and accommodated a number of factories in a four-and-five-story old factory. Weilong's production lines and offices are located on the first and second floors respectively. Although it has reached the working time, it is surprising that there are only about 20 employees in the hundreds of square meters of factory buildings and can feel the declining of the Shenzhen manufacturing industry. After seeing Zhang Ruilong, general manager of Weilong Technologies, Lei Feng asked several questions.
It is understood that Weilong Technologies and Youpin have started cooperation at the end of 2014, mainly providing plastic cases to the latter. Since the beginning of last year, they have also increased the orders for hardware pieces. Prior to this incident, there was no big difference between the two parties. . However, Zhang Yue announced yesterday that Weilong technology goods quality problems and delayed delivery problems exist?
Surprisingly, Zhang Ruilong bluntly said, "Quality issues have been fined according to product requirements."
However, Zhang Ruilong did not regard Zhang Yue's quality problem. "We have all done according to the requirements of the product. There is no difference in production line operation from the past. The plastics industry itself does not have a clear standard."
Weilong privately issued invoices to PICOOC?Zhang Yue’s previous information provided to Lei Feng Network showed that Weilong did not confirm the reconciliation with PICOOC, and issued 11 invoices to the latter. The invoice has been sent back to Weilong Technology and the settlement can be settled after the reconciliation is completed.
Reconciliation is a standard financial process, and making such a request is reasonable.
Lei Fengnet learned that in the past, Weilong and PICOOC were both reconciled through QQ or mail. The 11 invoices issued this time were in May, June and July, totaling more than one million yuan, and according to the usual practice. And the latter sent the corresponding information.
However, after PICOOC made a request for on-site verification to Weilong, Weilong science and technology staff had come to Beijing several times to coordinate, but all had no results.
“Actually, the reconciliation is very simple. We recently went to Beijing twice to deal with this matter on purchase orders, delivery notes and prepayment orders. But they have been evading the matter for two or three hours. They dragged on for several months.â€
How much does PICOOC default?
PICOOC sent suppliers a notice of payment at the end of June, but now Weilong Technology has not received this part of the payment.
Zhang Ruilong told Lei Fengnet that PICOOC’s outstanding payment for Weilong Technology was not only in May, June and July, but the money that had been reconciled between March and April had not yet been received. In addition, last year’s Mold costs and remodeling fees.
"Now the factory is unable to function normally. We also have suppliers to collect money. Now employees have not yet paid for two or three months."
Zhang Ruilong looked helpless. "Many employees have seen the company's current situation go away."
Because last year's cooperation between the two parties has been relatively smooth, Wei Long Technology did not pursue too tight a mold fee. However, by July, the total amount of various funds has reached 2.8 million yuan, which is not enough for a family. The big factory is a huge sum of money.
Zhang Ruilong disclosed that if the final lawsuit is followed, the factory may not survive.
PICOOC capital chain breaks?Although the negotiations between the two sides are still in a stalemate, the fact that PICOOC is in arrears in payments has basically been confirmed. To be fair , according to the logic of an ordinary person, it is hard to imagine that a company that has raised 21 million U.S. dollars will fall into the dilemma of arrears of payment in just two years. What else is hidden here?
An industry insider revealed an unknown secret to Lei Fengnet. In fact, PICOOC only invested RMB 21 million in the B-round financing, instead of PICOOC’s externally declared US$ 21 million. This seems to have opened the truth of the matter.
It is not new for a venture company to falsely report the amount of financing, but consider carefully the difference between 21 million U.S. dollars and 21 million U.S. dollars.
Although the entire smart body fat scale market shipments did not decline, but after the emergence of Yunmai, the price of body fat scale brands almost all dropped to 100 yuan online and offline, the profit of the product is minimal or even loss.
PICOOC body fat scale (source Jingdong Mall)
Yunmai body fat scale (source Jingdong Mall)
Wang Mai, the founder and CEO of Yunmai, told Lei Fengwang (search for "Lei Feng Net" public concern) that if the BOM cost and R&D costs are taken into account, the one-hundred-yuan body fat scale is hardly profitable on hardware.
Therefore, if we calculate the financing amount of RMB 21 million, and subtract the normal operating cost for each month, how many of these 21 million will remain after more than 20 months?
Postscript: At present, PICOOC has stopped all orders of Weilong Technology, and Weilong Technology is also making every effort to recover all the money. At the last minute of the interview, Zhang Ruilong informed Weilong Technology about the situation, because the cost of labor, rent and other costs have been rising, and the profit of the factory is less than 5%, which is also the status quo of Shenzhen's manufacturing industry. Of course, for the smart hardware companies, they have also encountered unprecedented difficulties. At the same time when each brand is playing a price war, the company is operating at almost zero profit. After the investors' money is burned, it will be a mourning.
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