As the golden era of cross-border e-commerce fades, once-dominant players are confronting unprecedented challenges. Recent reports about massive layoffs at a Guangdong-based e-commerce giant have sent shockwaves through the industry, revealing deep operational troubles at a company that previously enjoyed global success.
Benefits Erode: Early Warning Signs
As early as August 2022, the company suspended various employee benefits including overtime meal allowances and perfect attendance bonuses. The firm also intensified performance reviews, conducting assessments every two months and eliminating bonuses for employees rated in the bottom tiers. While top performers could receive S-grade ratings, the mandatory 10% quota created fierce internal competition.
Further austerity measures included reducing weekends from two days to one, cutting National Day holidays from seven to four days, and slashing annual leave entitlements. These changes clearly signaled financial distress and an attempt to reduce labor costs.
Workforce Reduction: From Boom to Bust
Evidence of downsizing emerged in May when internal data showed the employee count dropped from 4,070 to 3,741 within two weeks. Most departures clustered around weekends or month-ends, suggesting coordinated layoffs rather than voluntary resignations. Industry estimates suggest the workforce may shrink from its peak of over 6,000 to approximately 1,000 employees.
Regulatory warnings about excessive layoffs reportedly slowed the process in late August, with the company offering two compensation alternatives. However, the threat of further job cuts continues to loom.
Strategic Shifts: Desperate Measures?
In response to mounting challenges, the company initiated strategic changes including establishing a "strategic reserve team" modeled after Huawei's approach. The platform operations center leader was reassigned to this new unit, with the chairman personally assuming oversight of platform operations. This sudden leadership change involved a veteran executive who had reportedly sought to leave the company.
Branch Turmoil: Nationwide Impact
The layoff wave extended beyond Guangzhou headquarters. Employees at the Changsha branch revealed plans to eliminate the entire customer service department were abandoned due to proximity to labor authorities. A Jiangxi warehouse faced closure, but workers protested the compensation terms, leading to labor bureau intervention.
On September 8, the Changsha branch announced relocation to Guangzhou headquarters by October 9, fueling speculation this move aimed to pressure employees into resigning without proper severance.
Employee Resistance: Fighting Back
Facing what they perceive as unfair treatment, growing numbers of employees are organizing collective action to protect their rights, refusing to accept deteriorating conditions without challenge.
Industry Implications: The Road Ahead
Industry analysts attribute the company's struggles primarily to management missteps. However, current policies appear designed to shift financial burdens onto employees, despite the company possessing sufficient assets to meet legal compensation requirements.
This case reflects broader challenges in cross-border e-commerce, where intensifying competition and market shifts combine with operational weaknesses. To survive, companies must prioritize operational efficiency, risk management, and equitable employee relations alongside strategic innovation.
The path forward for cross-border e-commerce demands adaptability, creativity, and genuine commitment to workforce welfare. Only enterprises embracing these principles will thrive in an increasingly competitive landscape.