NetEase Yeation Breaks Silence Regarding Shocking Layoffs
NetEase Yeation broke their silence regarding recent horrific layoff rumors.
Mar 18, 2018 /EqualOcean/ - NetEase (网易), NetEase Yeation’s (网易严选) parent company, reports that only 8 percent of its employees are leaving than the initially rumored 30 to 40 percent, according to ebrun.
The 8 percent involves employees who voluntarily left and those who failed to pass their performance appraisal, according to TMT Post.
The company also claimed that they striving to optimize their internal departments and to find a balance between consumer goods quality and faster efficiency to serve their customers. NetEase Yeation separated from NetEase’s email service department and began reorganizing other original departments to serve the same purpose. For example, quality control, logistics, and business development were independent of each other. Now, they work together to optimize the company’s supply chain, a priority for the company for 2019.
NetEase’s vice president, SHI Wenyi (石闻一), also denied the problem caused by GMV. She states that NetEase Yeation’s model is designed to be well-stocked. Currently, the company has 10 categories and 20,000 SKUs (stock keeping units). The inventory turnover is 90 days or less.
According to NetEase’s financial report, the company’s main revenue streams are from its games and e-commerce. In 2018 Q4, NetEase reported RMB 6,679 billion, up 43.5% YOY. For the entire year, it reported total revenue of RMB 19.2 billion, a 65% YOY increase. Additionally, gross profit for e-commerce in 2018 was due to business development from its two e-commerce arms: NetEase Kaola (网易考拉) and NetEase Yeation. NetEase opened Kaola’s first flagship store and Yeation’s first brick-and-mortar store in Hangzhou.
However, the company claimed it wants to focus on developing the supply chain efficiency and not expansion as it's still in the early development stages. Yet, they plan to open more offline stores, flagship stores, and engage in more joint ventures.
In 2018, NetEase’s user e-commerce growth rate in tier 4 and 5 cities exceeded first and second-tier cities. The company also claimed that it increased its repurchasing users by 50%. In 2019, NetEase Yeation plans to improve its quality of goods and supply chain efficiency rather than focus on expansion.
While NetEase strives to improve employee productivity and efficiency, it’s valuable to also consider product quality and trademark issues. Recently, Estée Lauder sued NeteEase Kaola, demanding to stop infringement rights, according to Sina Tech. NetEase Yeation is also struggling as it faces price competition with JD.com.