Massive Chinese E-commerce Collapse: Intense Pressure from Pinduoduo Takes Its Toll

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Recently, the e-commerce industry in China is experiencing a wave of closures. These e-commerce businesses, already compressed by the 'low-price' trend promoted by various platforms last year, are now closing one after another. Recently, major shopping platforms have also imitated e-commerce giant Pinduoduo by introducing the 'refund only' feature, starting another nightmare for businesses.
'Refund only' means users can get a refund without returning the goods, an after-sales mechanism first introduced by Pinduoduo in 2021. Pinduoduo claimed that the intention behind implementing this rule was to enhance user experience, promote ordering, conduct survival of the fittest among businesses, and increase profits for businesses through increased order volume, offsetting after-sales costs, forming a positive cycle. However, in the process of implementation, it has become a tool for many unscrupulous buyers to cheat, engaging in 'zero-cost purchases' and causing considerable distress to platform merchants.
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