The Company thinks that by phasing out Store+, it can remove the significant cashflow requirements in association with this early-stage business, enabling the Company to further prioritize capital allocation towards its core businesses.
FREMONT, CA: BEST, an integrated smart supply chain solutions and logistics services provider in China, has announced that it will begin to wind down its BEST Store+ ("Store+") business.
The Company thinks that by phasing out Store+, it can remove the significant cashflow requirements in association with this early-stage business, enabling the Company to further prioritize capital allocation towards its core businesses.
The Company expects to stop all operations of Store+ by the end of the year except for the self-operated WoWo convenience stores, which the Company expects to continue running while evaluating various strategic options. The online merchandise sourcing and also store management platform would be handed over to independent third parties for continued operations.
"Store+ provided a creative solution for last-mile delivery and empowered many small merchants to participate in online-to-offline commerce," stated Johnny Chou, Chairman and Chief Executive Officer of BEST. "Over the past several quarters, Store+ has been making encouraging progress in reducing losses. However, as we continue to deploy capital towards our core businesses in order to strengthen our position in the increasingly competitive market environment, we concluded that phasing out Store+ is in the best interest of our Company as a whole and in line with our commitment to sustainable profitability and enhancing shareholder value."
In addition, the Company declared a management change to BEST Express. Effective as of the date of this announcement, Mr. Shaohua Zhou would cease his role as Senior Vice President, General Manager of BEST Express, and start a new role as special assistant to Mr. Johnny Chou. Mr. Xiaoqing Wang would join the position of Vice President, General Manager of BEST Express.
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