In a recent development, the founder of Zhongxuegao has been barred from indulging in extravagant consumption as the popular Chinese ice cream brand grapples with financial woes stemming from unpaid obligations.
According to corporate data platform Tianyancha, Zhongxuegao and its founder, Li Sheng, have been subjected to limitations on high-end expenditures, alongside an obligation to settle a sum of CNY810,000 (USD112,670).
Recent reports indicate a significant drop in the prices of Zhongxuegao’s ice cream products, plummeting from CNY60 (USD8.35) to approximately CNY10 at the company’s official outlet and even lower to CNY4 (56 US cents) on various online platforms.
A wholesaler disclosed to Yicai that they have ceased retailing Zhongxuegao products due to perceived diminishing value, particularly as Chinese consumers tend to gravitate towards trending internet sensations.
During a visit to Zhongxuegao’s headquarters in Shanghai, Yicai discovered the main entrance to be sealed shut. Although the company’s research and development center in the same vicinity was accessible, a noticeable accumulation of office furniture cluttered the corridors.
Zhongxuegao’s official presence on Chinese social media platforms Weibo and WeChat has remained dormant since August of the preceding year. However, the company conducted its latest live-streaming event on the short-video platform Douyin as recently as March 8, while also continuing to recruit personnel for the same platform.
Established in 2018, Zhongxuegao rose to prominence as a leading ice cream brand in China, surpassing Häagen-Dazs in sales during the Double 11 Shopping Festival between 2019 and 2022, amassing over CNY100 million (USD14 million).
However, the company encountered public scrutiny in July 2022 after its ice cream products were accused of being resistant to melting under sunlight. Subsequently, in October of the same year, Zhongxuegao faced allegations of unpaid debts. Despite responding that it was addressing the associated disputes and operating normally, the brand’s reputation has since been under scrutiny.
