Best World

[Wildreamz]

A simple Google Search regarding whether MLM is legal in China, yields largely similar results, from a variety of sources:

1. 多层次传销 (MLM): https://zh.wikipedia.org/wiki/%E5%A4%9A%...7.E9.99.B8 

中国大陆
在中国大陆，多层次传销与金字塔式销售被统称为传销，属于经济犯。
在中国大陆传销，多层次传销与直销皆不同，只有直销合法。

2. Multi-Level Marketing: China Isn’t Buying It: http://www.china-briefing.com/news/2017/...uying.html

From our experience, a large number of foreign companies have expressed interest in entering into the Chinese market through this MLM structure. However, they are going to be disappointed.

In 2005, Chinese government enacted a law called Regulation of Direct Sales and Regulation on Prohibition of Chuanxiao (Chuanxiao stands for MLM). With this regulation, China makes clear that while Direct Sales is permitted in the mainland, MLM is not.

3. Multi-level Marketing in China: http://www.chinalawblog.com/2017/07/mult...china.html

Multi-level marketing* is hot. Selling products to Chinese consumers is hot. All this means multi-level companies are interested in going into China. But as the following portion from a memorandum one of our China lawyers wrote, multi-level marketing in any form is prohibited in China. This prohibition is based on the Regulations for the Prohibition of Pyramid Selling (2005).

I think this debate should be settled?

[Boon]

https://www.nextinsight.net/story-archiv...-in-2h2017

Best World's chief operating officer, Huang Ban Chin, didn't overstate things when he said in an interview with Business Times last week: “The company is on track to hit analyst targets of S$41 million to S$44 million of net profit for 2017. This translates to a 20-30 per cent improvement from 2016.” 

What drove profit growth in 1H2017 was demand for Best World’s DR’s Secret skincare range of products in China. This will continue to be the thrust in 2H2017, as Best World widens its outreach to Chinese consumers.

Seems like BWI is not affected by the crackdown in China and they are on track to achieve $41mm to $44m NPAT in line with analyst estimates. A company that continue to deliver value to both its customer and to society will continue to thrive and do well. BWI stock price is also starting to recover from the crash.

Without the “illegal multi-level-compensation structure”, how would the “real” demand be? How would the “real” sales figure be? “The COO didn’t overstate things”, it got to be kidding, I reckon.

Illegal would be base on your assumption which can be right or wrong. So long as BWI can continue to sell their products in China and able to get more and more license covering more cities in China, the PROFITS would be REAL which can be returned to shareholder as dividends and the value of the business would continue to grow.

Are you making an ASSUMPTION that the COMPANY could continue practising DS based on multi-level-compensation structure, which is illegal,  as more DS license covering more cities is being issued in China ? 

Don't you think the "Export Model" is a better disguise than the "legitimate DS model" to "cheat" the authority?

Without the “illegal multi-level-compensation structure”, how would the “real” demand be? How would the “real” sales figure be? 

True, a 1 million profit is REAL, so is a 100 million profit..............

[Boon]

From Dora’s speech, she attests that;
CGL joined BWL (as a distributor) 8 years ago
CGL was a leader of Chao Yue Ti Xi - the network team he built up over the years.
CGL has a PD ranking under BWL ranking system.
CGL passed away in 2016.
His family inherited his passive income generated from his network team - Chao Yue Ti Xi.
This passive income in FY2016 is so substantial -enough to qualify CGL as one of the TOP 10 earners among BWL' s distributors in FY2016.
What could this passive income be which Dora describe as better than an insurance policy?
It must be commission from sales generated from his downlines in his network, what else could it be?

If this “passive income” were indeed commission derived from sales generated by CGL’s network downlines, it is considered an act of 传销, which is illegal, under the 禁止传销条例.

If this is the case, it means the CEO is attesting to the whole world, through the video, that the Company has been engaging in illegal activities in China, am I not right?

Watch from minutes 17.00 onwards
 
CGL’s “membership” with BWL is inherited by his wife 代生艳.

As a result, “passive income” derived from CGL’s network team/ downlines is inherited by his wife.
 
All these are “parlance” of DS based on multi-level-compensation structure.
 
In an “Export Model” where “export revenue” is recognized when goods are shipped, what has BWI/BWL got to do with CGL’s membership, network team, passive income, inheritance etc ????????????? 
 
The business relationship between CGL and BWL is obvious from the videos, and it is illegal. These are factual evidence and not assumption.

[weijian]

A ramp up in its financial investments (mainly bonds i reckon) from ~2mil SGD to 11mil SGD.

INVESTMENTS IN QUOTED SECURITIES

http://infopub.sgx.com/FileOpen/2017-10-...eID=474587

[Squirrel]

Best World has announced results

http://infopub.sgx.com/FileOpen/2017%201...eID=477341

China's expansion more than made up for Taiwan's drop (higher margin in direct export model) even though overall sales revenue dipped.

The company continues the trend of drop in Taiwan Revenue which is more than made up for by the "Direct Export" model in China. Quarter's sales in Taiwan is down 46.1% year-on-year. Going by how historically sales plunge in regions once it starts to trend down, this doesn't look good. Those once dominant sales region makes up very little of the overall sales by the company. Will Taiwan go down the same way?

China continues to expand at the unbelievable pace for "direct export" model. From all the discussions going on so far, I guess we all know where this is coming from. Only question left is whether it is sustainable/legal.

If China's licence was threatened, BW seem to have nowhere to rest on as a back up.

[BlueKelah]

nothing new here yawn... share price taking a big hit today accordingly... think I mentioned before nothing special about BWL Dr. secret product, they will not be able to compete with other mainstream proper cosmetic companies, especially those coming out of other asian countries like Korea/Japan. Big industry but very competitive.

The only edge they have is their selling methods. Chinese consumer is not stupid and can be quite fickle.

[DCF]

how do you know that there is nothing special about the product?

This guy said he tried and it is good, and he buy more shares
https://www.nextinsight.net/story-archiv...cent-crash

[grandslam]

I purchased a few products for my wife and the feedback is good, comparable if not better than SK II.

[corydorus]

Everytime we go into new territory, goods need to be stocked. Key is where. Some companies practised channel stuffing, some with other methods depending on their model. This may explain high sales initially.

.

[cyclone]

Best World FY2017 profit surges 61.0% to record high of S$55.7m

Highlights :
* Revenue grew 10.0% to S$220.9 million due to increase in Export to China and growth in Singapore & Other markets
* Strong balance sheet with cash position of S$82.2 million
* Proposes final dividend of 2.6 Singapore cents per share
* Expansion of direct selling license coverage in China sets stage for growth in FY2018 and beyond
* Sales from China almost doubled to S$110.5 million, representing a 90.9% increase YoY in FY2017
* Revenue from the Group’s key market of Taiwan declined 28.5% YoY to S$88.0 million in FY2017
* The total membership for the Group’s Direct Selling business as at 31 December 2017 increased 2.2% to 490,041 members, when compared to 30 September 2017.

More details in :
1. http://infopub.sgx.com/FileOpen/BWG%20FY...eID=490214
2. http://infopub.sgx.com/FileOpen/BW%20FY2...eID=490215