Dear MEL Topic Readers,
How one disappointing order uncovered a massive ‘ghost cake’ delivery
scandal in China
The competition among food delivery services has become overly intense
in China. Recently, authorities found that thousands of ghost online food
vendors, without business licenses or actual storefronts, were taking orders
from consumers and reselling them to the lowest-bidding bakeries. In one case, out
of 100, let's say yuan, the customer paid for a birthday cake, the ghost vendor took 50, the
intermediary platform grabbed 20, and the actual baker earned only 30, which is
way too low to guarantee the food quality and safety, not to mention the
customer’s satisfaction. Such ghost vendors were born due to intense price
competition, known as involution in China, and are now selling various
products, including electric vehicles and solar panels, at the sacrifice of suppliers'
diminishing returns. Though anti-involution campaigns have been implemented by various
authorities to curb such unhealthy, unsustainable business practices, eager suppliers
are bidding to take any order just to keep their businesses running.
Read the article and learn about fierce online business competition in
China.
