Μjust a few days ago we heard reports about the Chinese telephone company Smartisan, which seems to be facing financial difficulties. While the CEO of Smartisan denied these reports, today we learned that the company does have a liquidity problem.
According to the cnBeta website, the company has been sued by Coolpad for debts. The lawsuit was filed by Dongguan Yulong Communication Technology Co. Ltd, a subsidiary of Coolpad, against Beijing Hammer Digital Technology (Smartisan).
The plaintiff claims that he signed a contract with Smartisan for the supply of mobile phones worth more than 10 million Chinese yuan. However, after the delivery of the products, the company has not yet repaid half the amount. So far, there has been no response from the latter.
If Smartisan really owes its supplier, it is not unreasonable to believe the reports that the company is facing financial challenges. As we have seen in the case of similar companies that have closed their mobile divisions such as LeEco and Gionee, unpaid bills are one of the proofs in a business that is not doing well.
Smartphone sales have declined this year and while there are still some winners, more will be lost. Three groups have more than 90% of mobiles in China. All other companies are fighting for a small spot in the market. The sad thing is that some of them may not be able to recover and will end up closing. In this case, the consumer is also lost.
