It was revealed that Orange Heart Selection has been shut down as a whole.

Stop, news of all business, production and research staff being laid off. In fact, there have been rumors about the closure of Orange Heart Selection before. It was revealed that Orange Heart Preferred has shut down its entire offline network. It was revealed that Orange Heart Selection has been shut down in its entirety 1

Recently, some netizens broke the news on social platforms that Didi (DIDI.US)’s community group buying business Orange Heart Selection has been shut down in its entirety. Related industry and research All staff in the position were laid off.

On March 2, a Didi insider revealed to the Red Star Capital Bureau: “The production and research teams in Orange Heart Select’s Hangzhou region have almost been laid off, and the laid off workers’ unions will receive N1 compensation. "The source revealed that since the end of last year, Chengxin Youxuan has begun to gradually lay off employees. "Before the Spring Festival, Chengxin Youxuan's business, marketing and other positions were laid off, and this time it began to lay off core production and research positions." The person also said that Didi paid out year-end bonuses at the end of February, including laid-off employees.

Since the second half of last year, there have been constant reports of Orange Heart Selection shrinking its business. In early September 2021, there was news that Orange Heart Preferred had reduced the previous 9 regions and 31 provinces to 3 regions and 9 provinces. In December, Orange Heart Selection, which was originally placed on the Didi APP page, was removed from the shelves. Another former employee of Orange Heart Preferred told Red Star Capital Bureau: "In December last year, the national C-end business of Orange Heart Preferred's community group buying was shut down, and only part of Sichuan was retained."

As for Red Star Capital Bureau sought confirmation from Didi as to whether the Orange Heart Select business has been shut down as a whole. As of press time, there has been no relevant response.

Orange Heart Preferred business has shrunk

It was removed from the Didi APP page at the end of last year

Recently, some netizens posted that , Didi’s community group buying business Orange Heart Selection has been shut down as a whole, and all relevant production and research staff have been laid off. A former employee of Orange Heart Preferred told Red Star Capital Bureau: "In December last year, the national C-end business of Orange Heart Preferred's community group buying was shut down, and only part of Sichuan was retained."

In fact, , since the second half of last year, Orange Heart Preferred has been continuously reporting business contraction and layoffs of personnel.

In September 2021, Orange Heart Select was exposed to have closed multiple central warehouses and grid warehouses. As a transfer station connecting the main warehouse in Orange Heart's preferred cities and the pick-up points of offline stores, the grid warehouse undertakes the important task of sorting and distribution at the end of the platform's sinking market. It is also an important link that is different from traditional e-commerce logistics. .

This was not a positive signal. It was interpreted by the market at the time as: Orange Heart Preferred was shrinking on a large scale. Later, LatePost reported that Orange Heart Preferred had reduced the previous 9 regions and 31 provinces to 3 regions and 9 provinces.

Red Star Capital Bureau learned in an interview at the time that on September 8, 2021, Orange Heart Selection in Changzhou, Jiangsu Province had closed the group point system and announced the suspension of business operations in Changzhou. Long explanation: "The operation was stopped due to optimization and adjustments." At the same time, the Orange Heart Select Grid Warehouse located in 8 counties including Qingyuan County, Luxi County, and Tonggu County in Jiangxi Province announced the closure of the warehouse. The relevant person in charge stated in the work group that September 8 will be the last night to fulfill the contract. .

Picture comes from Douyin APP

According to public information, in Shandong region, Orange Heart Selection has closed its business in Jining City on September 7. Businesses in Linyi City were closed on September 13, and finally Jinan and Qingdao. In Jilin Province, Hainan Province, Guangdong Province, Guangxi Province, Ningxia and other places, Orange Heart Preferred is gradually withdrawing.

At that time, a person familiar with the matter told Red Star Capital Bureau that Orange Heart Preferred would shrink in batches and withdraw its positions based on city warehouse dimensions. Fourth-tier cities would be the first batch, and third-tier cities would be the second batch. The third batch will be provincial capital cities and first-tier cities, and finally the Sichuan and Chongqing markets will be retained.

According to Jiemian News, Orange Heart Selection formulated a shrinkage plan as early as June 2021. In addition to structural adjustments, there are also unavoidable layoffs. An insider close to Didi said that Orange Heart has about 8,000 employees nationwide. They can choose to stay in Orange Heart, or they can transfer to other departments. If they are unwilling to do so, they will be treated as N+1. Provide severance compensation.

The background of Orange Heart Preferred’s large-scale adjustment and contraction can also be seen from Didi’s financial report. In the third quarter of 2021, Orange Heart Preferred’s loss reached 20.8 billion yuan. At the same time, Orange Heart Select will shift its focus to wholesale business and incubate retail terminals and wholesaler trading platform - "Orange Wholesale".

The new business did not bring about a turnaround for Orange Heart Selection. Red Star Capital Bureau learned that in late December 2021, Orange Heart Selection, which was originally placed on the Didi APP page, was removed from the shelves, which also meant that the core diversion entrance of Orange Heart Selection was shut down.

The `Orange Heart Preferred Entrance’ in Didi APP

has now been removed from Didi APP

The daily order volume once exceeded 2.8 million in 3 months

It only took a year and a half from prosperity to decline

Before June 2021, Orange Heart The best thing is still the momentum of rapid progress.

From the time it was launched in June 2020 to the announcement that it had won the first place in single volume in Sichuan and Chongqing, it only took less than 3 months.

In September 2020, the expansion speed of Orange Heart Preferred further accelerated, and the speed of Kaicheng doubled. According to China News Network, at the end of September, the daily order volume of Orange Heart Select exceeded 2.8 million orders nationwide.

According to Southern Metropolis Daily, at the Didi all-staff meeting on November 3, 2020, the fifth month after its launch, Didi CEO Cheng Wei doubled his confidence and expressed his determination on the spot: "Didi There is no upper limit on investment in Orange Heart Select and we will try our best to win the first place in the market. On the day of Double 11, the daily order volume of Orange Heart Select exceeded 10 million.

Since then, Orange Heart has been optimizing users with high subsidies, recruiting employees with high salaries, opening stores in cities like crazy, and running like crazy.

The change occurred in March 2021, when Didi reported that it would spin off community group buying and be listed separately. Later prospectuses also showed that Orange Heart Preferred had conducted A1 and A2 rounds of financing and convertible bonds in March, with its latest valuation reaching US$1.8 billion.

After the financing, Orange Heart Select changed its market strategy from loss-making subsidies to the pursuit of profits. In May 2021, Orange Heart Preferred stopped offering full discounts, and order volume dropped sharply. At the end of June 2021, according to public information, Orange Heart Preferred planned to cancel 20 wartime subsidies.

According to research and analysis by market investment institutions, Orange Heart Selection’s daily order volume at the end of 2020 was approximately 13 million orders. After the subsidy was suspended in June 2021, the daily order volume dropped to between 8 and 10 million orders. The daily order volume of Tuanyouxuan and Duoduomaicai is about double that of Orange Heart Youxuan.

At the end of July, Orange Heart Preferred moved its headquarters from Chengdu to Beijing and Hangzhou. Then in early September, news came out that Orange Heart Preferred had reduced the previous 9 regions and 31 provinces to 3 regions and 9 provinces.

Red Star Capital Bureau learned in the interview that the business of Orange Heart Selection has changed rapidly. A third-party labor service company in Yulin, Shaanxi that is responsible for recruiting employees for Orange Heart Selection’s grid warehouse told Red Star Capital Bureau that in 2021 Recruitment information for vegetable sorters was still being released normally on July 24, but just two months later, news of the grid warehouse’s withdrawal was received. It was revealed that Orange Heart Selection has been shut down in its entirety 2

On March 2, according to the Weibo account "Chief Insider Officer", a Didi employee posted on the social platform that Orange Heart Selection has been shut down across the board. , news that all business, production and research staff have been laid off.

In fact, there have been rumors about the closure of Orange Heart Choice before. In September 2021, Orange Heart Preferred was exposed to large-scale layoffs, and its business scope was also reduced from 9 regions and 31 provinces to 3 regions and 9 provinces.

In February 2022, the corporate status of Orange Heart Shenzhen Company was changed to cancelled. At that time, the company was less than a year old.

In this time of sudden changes, it’s not just Orange Heart Selection that can’t hold on. Pandora’s box has been opened, such as Tongcheng Life, Food Enjoyment Club, Meiyijiaxuan, Squirrel Pinpin, etc. Community group buying platforms have also closed down.

Among these bankrupt companies, there were some that were developing extremely fast, but they were also dazzled by the dividends and ignored the limits of their own supply chains and funds, which resulted in the collapse of the entire industry.

The trend of community group buying has changed and the tide has receded.

Orange Heart Selection is closed, hiding a secret

Before the epidemic, Chinese families were accustomed to "family shopping" and went to the wet market to buy enough fresh food for the whole family.

However, epidemic control has made people no longer go out as they like before. Internet giants such as Alibaba, Meituan, and Pinduoduo are also at a bottleneck in development and are in urgent need of fresh traffic injection. Driven by various forces, community group buying has become popular.

On June 15, 2020, Orange Heart Select’s business was launched on Didi.

"There is no upper limit on Didi's investment in Orange Heart Select, and we will try our best to win the first place in the market." Didi Chairman Cheng Wei's high-spirited remarks are still ringing in our ears. In just one year, it has No longer able to hold on.

By counting the short life of Orange Heart Selection, we can sum up some experiences and provide some warning for "travelers" who can still continue.

First of all, Orange Heart Selection was developed vigorously by Didi. Fa Ka’s style of play is to use its own financial advantages to focus on flash sale products that are lower than the market price, making its opponents despair.

With the injection of tens of billions of funds, Orange Heart Selection also had a glorious time, winning 7 million orders nationwide.

The essence of community group buying cannot escape retail. The key to retail lies in the supply chain, and the supply chain cannot be established overnight.

In the early days, Orange Heart Selection did win huge traffic at low prices, but how could the immature structural model digest the sudden influx of traffic. Without chassis undertaking, these users acquired by spending money will be lost in vain.

Platforms such as Duoduomaicai and Meituanxuan, which were born out of e-commerce giants, are obviously different. They also attract traffic with money. Duoduomaicai and Meituanxuan can support each other and the main business, perfectly absorb.

In the final analysis, Didi has no basis in fresh food and has no inherited genes, which is the key to the failure of Orange Heart’s selection.

If Didi’s launch of a new community group buying business was an adventure, changes in external conditions such as policy controls on the industry gave Orange Heart Selection a fatal blow.

In March 2021, the State Administration for Market Regulation imposed an administrative penalty of RMB 1.5 million on Orange Heart Preferred due to low-price subsidies and disrupting market price order.

Orange Heart Select, which was forced to adjust its strategy, raised prices. It was originally dissatisfied with the low quality of its products due to price cuts, and a large number of users began to lose.

With the warming of the solar term, consumers are more willing to buy fresh products directly offline, and they feel more confident when choosing by themselves. This is even worse for Orange Heart Selection.

In the end, the dike of a thousand miles collapsed in an ant nest. Didi, who had become a monk halfway, lacked manpower and qualifications, had chaotic management, and failed to take care of the interests of suppliers, consumers, etc.

It is reported that due to factors such as inflexible mechanisms, frequent returns, and poor coordination of rules, it is difficult for most Orange Heart Preferred suppliers to make money.

In addition, because professional people are not in charge of professional matters, it is easy for mistakes to occur during the transaction process, attracting complaints from consumers. On the Black Cat complaint platform, there were nearly 6,000 complaints about Orange Heart Selection, which is slightly more than twice that of the longer-established Dingdong Grocery.

It was revealed that Orange Heart Selection has shut down its entire offline 3

Recently, a Didi insider revealed to the Red Star Capital Bureau, “Orange Heart Selection has begun large-scale layoffs since the end of last year. When core positions in production and research are laid off, the laid-off employees will receive N1 compensation as stipulated in the labor law. Didi issued a year-end bonus at the end of February, including the laid-off employees of Orange Heart Preferred." It is visually estimated that Orange Heart Selection may have been shut down across the board, and all relevant production and research staff will be laid off.

Since the second half of 2021, there have been reports of Orange Heart Selection shrinking its business. In December 2021, Orange Heart Selection, which was originally placed on the Didi APP page, was removed from the shelves, which also means that the core diversion entrance of Orange Heart Selection was shut down, and Orange Heart Selection may have been shut down across the board.

In fact, since the second half of last year, Orange Heart Selection has been continuously reporting business contraction and layoffs of personnel.

At that time, Orange Heart Selection did indeed shrink. It closed cities and evacuated warehouses in batches according to the city warehouse dimension. Fourth-tier cities were the first batch, third-tier cities were the second batch, and provincial capital cities and first-tier cities were the second batch. In the third batch, the Sichuan and Chongqing markets were finally retained.

Due to serious losses, Orange Heart Preferred chose to shrink its business and lay off employees on a large scale. It can also be seen from Didi’s financial report that in the third quarter of 2021, Orange Heart Preferred’s losses reached 20.8 billion yuan.

With such huge losses, no one would have thought that Orange Heart Selection would have its moments of glory at that time. In the fifth month after the launch of Orange Heart Select, Didi CEO Cheng Wei doubled his confidence at the Didi all-staff meeting on November 3, 2020, and expressed his determination on the spot: "There is no upper limit to Didi's investment in Orange Heart Select. , and strived to win the first place in the market. On the day of "Double 11", the daily order volume of Orange Heart Selection exceeded 10 million. Since then, Orange Heart has been subsidizing users with high subsidies, recruiting employees with high salaries, opening stores in cities like crazy, and running like crazy.

In 2020-12, relevant departments began to pay attention to the chaos of community group buying, and then new regulations on the "nine prohibitions" on community group buying were introduced one after another. Regulations prohibit low-price dumping and big data manipulation, and Orange Heart Selection has therefore begun to go downhill.