Beauty Community lost 98% of its value when China closed the daigou channel

Beauty Community PCL is a Thai cosmetics company listed on the Stock Exchange of Thailand. It owns Beauty Cottage, Beauty Buffet, and Gino McCray, brands sold across 300 retail stores and exported to China. At its peak in 2017, the company posted 3,735 million baht in revenue and 1,229 million baht in net profit, with a stock price of 23.70 baht.

The company's success was built on the daigou channel — Chinese personal shoppers who bought Beauty Buffet products in bulk and resold them on Taobao. This unregulated reseller channel contributed approximately 1,000 million baht annually through about 2,000 Taobao sellers. The company had no contracts, no compliance controls, and no alternative distribution channel of comparable scale.

In early 2019, China enforced a new customs law requiring daigou goods to be declared and taxed. The effect was immediate: Taobao sellers dropped from 2,000 to 30, and the daigou revenue stream effectively disappeared. The stock fell from 23.70 baht to below 2 baht. Revenue dropped to 2,200 million baht in 2019, with profit falling to 233 million baht.

COVID-19 delivered a second blow in 2020, closing 95% of the company's approximately 300 stores and eliminating Chinese tourist traffic that accounted for 89% of international sales. The company posted a net loss of 105 million baht in 2020 and has recorded losses every year since. By mid-2024, the stock traded at approximately 0.30 baht, representing a 98% loss of market capitalisation from the peak.