Qoo10 sellers complain about delayed payments of ‘hundreds of thousands’, police investigate

Timothy Goh and Wong Yang
Strait Times
September 13, 2024

Singapore-based e-commerce platform Qoo10 and its logistics subsidiary Qxpress are under police investigation following complaints from suppliers about late payments worth thousands of dollars each and disruptions to deliveries made by Qxpress.

In response to queries from The Straits Times, on September 12, Singapore police said reports had been filed about Qoo10 and Qxpress and that they were investigating the matter.

Qoo10, which is backed by the likes of private equity firms KKR and e-commerce giant eBay, did not respond to ST’s requests for comment. Both KKR and eBay declined to comment.

Suppliers told ST that Qoo10, which also operates in Malaysia, Indonesia, Japan and Hong Kong, had not paid them on time.

A spokesperson for the hair care retailer, who declined to be named, said Qoo10 owes the company nearly $32,000. It added that the retailer removed its listings from the platform on Sept. 12.

“Previously, we were still able to receive payments from Qoo10, although there were slight delays,” he said.

“We requested a withdrawal in June but still haven’t received the payment. We’ve been in touch with Qoo10 since then but they just told us to wait.”

Ms Wang, the founder of baby goods store Baby Gallery, who asked to be identified only by her last name, told ST in a Sept 12 interview that the platform currently owes her company more than a year’s worth of debt, amounting to more than $11,000.

Although the payments appear as settled on the merchant’s dashboard, the woman said she has not received the funds so far, which is why the issue went undetected for some time.

“I will report the matter to the police because the amount is huge,” said Ms Wang, who also removed her company’s listings from Qoo10 on September 12.

She noted that before Qoo10’s recent problems, the platform typically released payments to Baby Gallery within seven days. However, since 2023, the platform’s payment release time has been steadily increasing.

A spokesperson for Annabella Patisserie, who only went by Andy, said Qoo10 currently owes the bakery more than $25,000, which is equivalent to about a month and a half of repayments.

“We have decided to write off the amount due… and have kindly requested our customers to place orders through other channels in the future,” he said, although the bakery’s products remain on offer on Qoo10 for now.

Another vendor, Chun Cheng Fishery, said Qoo10 only recently paid the company for its July settlement. A sales representative for the company said an account manager at Qoo10 indicated that all pending payments would be released by mid-September, but added that the manager was unsure whether that would actually materialize.

Mr. Richard Siaw, managing director of law firm RS Solomon, said he represents five companies that Qoo10 has owed hundreds of thousands of dollars in arrears and that plan to take action against the e-commerce platform.

He said: “My clients have been waiting for four to six months to see if they will be paid the full amounts they are owed. They have had a good relationship with Qoo10 for many years, so they have tried to resolve some issues with them. But it has become untenable and they are now planning to take legal action.”

Meanwhile, suppliers using Qxpress to ship their goods to and from Singapore have been struggling with delays since July, documents seen by ST show.

An online K-pop merchandise seller who only wants to be known as Sarah said she has yet to receive two packages worth a total of $3,500, even though it has been two months since Qxpress picked them up in South Korea.

Sarah, who collects group orders of K-pop albums, postcards and other items from 30 to 50 buyers in Singapore, said Qxpress picked up her shipments from her replacement buyer on July 5. She typically receives the items in Singapore about two to three weeks after they are picked up there.

Although tracking data shared by Qxpress indicated the parcels had arrived at a distribution centre in Singapore on July 20, by the end of July they had still not been delivered, and concerned customers began texting Sarah to ask about the status of their orders.

Most of her buyers — who each spent about $100 on K-pop merchandise — are aged between 16 and 20, while some have used pocket money from their parents to buy the goods, said Sarah, who is in her early 20s. She collects payments directly from her buyers and hires Qxpress to deliver her goods from South Korea before shipping each buyer’s order via Singapore Post.

She added: “I’ve been calling Qxpress 10 to 15 times a day since early August and I’ve also sent them a few emails. But they always reply the same way – that they’ll check and call me back. It’s so frustrating because nothing has changed.”

Sarah, who works part-time in retail, said Qxpress told her that three failed attempts had been made to deliver her parcels in August, but she had not received them and had not seen a courier outside her flat. She is considering taking further action in the hope of receiving compensation to refund her customers.

Suppliers shipping from Singapore via Qxpress have also been affected.

Mr. Vegas Lee, a young creative professional who sells and trades vintage Japanese clothing in his spare time, said his U.S. customers have not yet received their orders about a month after Qxpress picked them up from him in Singapore. His customers typically receive their items within seven to 12 days.

Mr. Lee, 22, shipped 23 boxes of clothes and shoes worth about $3,500 to buyers in the U.S. and Europe in the first two weeks of August. After the courier told him it was discontinuing European delivery routes, eight boxes destined for Europe were sent back to him in the first week of September, Mr. Lee said.

Meanwhile, tracking information for 15 boxes destined for the U.S. has not changed for weeks after an Aug. 22 update that said the packages had arrived at a Qxpress processing facility in Singapore. When Mr. Lee contacted Qxpress by email and phone, customer service representatives said his packages were being processed to be shipped from Singapore, while others told him the boxes had arrived at Los Angeles International Airport.

To his relief, tracking information for 14 of the 15 packages was updated on September 12 to reflect that they were either en route or awaiting processing at a DHL distribution center in the United States.

Mr Siaw said of the delivery issues: “If parcels remain undelivered, Qxpress has breached its contractual obligations, which could result in a civil case unless service users can prove that criminal offences such as fraud or misappropriation have been committed.”

The first reports of Qoo10’s problems emerged in July when it was revealed that TMON and WeMakePrice, two South Korean e-commerce platforms owned by Qoo10, had failed to pay their suppliers, prompting South Korean authorities to launch an investigation.

According to South Korea’s financial watchdog, the Financial Supervisory Service, WeMakePrice reportedly owed nearly 500 suppliers 36.9 billion won (S$36 million). The platform said at the time that the problem stemmed from a payment system glitch that affected suppliers.

In August, it was reported that Qoo10 had laid off about 80 percent of its Singapore staff. The Ministry of Manpower said at the time that the Responsible Retrenchment and Employment Facilitation Team was monitoring the company’s layoff efforts.

“Workforce Singapore and e2i (Employment and Employability Institute) NTUC are providing career counselling and employment facilitation services to Singaporeans and permanent residents affected by job cuts,” it noted.

Melvin Yong, president of the Consumers Association of Singapore (Case), said in response to questions from ST that the consumer organisation had received nine complaints about Qoo10 since September 9.

“Consumers have typically complained about delayed or undelivered orders, inability to get refunds, and inability to use funds in their accounts,” he noted. “Case has reached out to Qoo10 to promptly resolve consumer complaints.”

In response to a parliamentary question on September 10, Deputy Prime Minister and Minister of Trade and Industry Gan Kim Yong said the government had received feedback from several Singaporean merchants about late payments from Qoo10.

“We have reported these cases to Qoo10 and requested for swift action to resolve the delays with affected merchants,” he said.

“The government is also closely monitoring developments in South Korea regarding Qoo10’s subsidiaries and is in contact with Qoo10 to assess whether and how this may impact the company’s operations in Singapore.”