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Zhong Shanshan, China's richest man and founder of beverage giant Nongfu Springs, has publicly criticized the aggressive pricing tactics of online shopping platforms, accusing them of destabilizing industries amid the country's economic downturn.
Zhong specifically targeted Pinduoduo, a major e-commerce site, for driving down prices in ways that he claims harm domestic brands and industries. "Internet platforms have brought down [our] pricing system," Zhong said during a visit to eastern China. "In particular, Pinduoduo's pricing system has done great harm to China's brands and its industries."
Unusually for a Chinese business leader, Zhong also criticized the government for failing to intervene. He accused officials of being "negligent in their duty" to prevent the harmful trend of cut-throat pricing, a rare rebuke likely to draw significant attention.
Pinduoduo, known for its rapid growth fueled by competitive pricing, has reshaped Chinese consumer behavior during a time of economic hardship. However, Zhong argues that this has led to a "race to the bottom" in pricing, hurting both businesses and workers.
Zhong's comments come at the end of a challenging year for the billionaire. Earlier, nationalists criticized him for perceived lack of patriotism, causing Nongfu's shares to plummet. While Zhong has regained his position as China's wealthiest individual, his remarks highlight growing concerns about the pressures faced by traditional industries in a digital-first economy.
The critique also recalls similar consequences faced by other outspoken entrepreneurs, such as Alibaba's Jack Ma, who retreated from public life after criticizing China's financial system. It remains to be seen whether Zhong will face repercussions for his remarks.
