E-commerce Fashion Sorabel went Bankrupt due to Corona Pandemic
The list of startups that fell due to the impact of the coronavirus pandemic has again grown. Sorabel e-commerce startup will certainly close at the end of July 2020. Sorabel will liquidate and will terminate all employees’ work contracts without exception.
The process will take effect on July 30, 2020. In a copy of internal emails to employees, Sorabel explained that the company had done its best to save the business, but in the end, they had to take the road of liquidation.
“Because of the liquidation process, the working relationship must end at this stage for everyone without exception, precisely effective on July 30, 2020. I am sure no one expects this to happen,” the email was quoted as saying by DailySocial.
Liquidation is the liquidation of a company as a legal entity and at the same time the acquisition of assets by selling assets, collecting accounts receivable, paying off debt, and settling the remaining assets or debts among the owners of the company.
Liquidation is also closely related to financial problems. Companies that conduct liquidation generally tend to be unable to generate sufficient cash flow and do not have the ability to meet their short-term obligations.
Management will Ensure that All Employee Rights are Fulfilled
Sorabel Management stated its commitment to ensure all employee rights were fulfilled during the liquidation process, including holiday allowances (THR). The company is also committed to complying with all regulations and decisions of liquidators.
Employees are expected to return company assets, which will be resold and processed by the liquidator. Management also promised to help them find new jobs from an investor network of more than 100 companies.
“This may be the end of our journey with Sorabel. I hope we can keep the good memories we have together in this place. The company expresses its deepest gratitude to you for struggling to the end,” Sorabel management said in a writing statement.
According to iPrice data in the second quarter of 2020, Sorabel reportedly had 375 employees. Sorabel also has offices in Jakarta, Tangerang, Yogyakarta, Bandung, and Singapore. Before this news appeared, Sorabel had announced on social media about the closure of their business unit in the Philippines, Yabel, in February.
Sorabel the Pioneer of the CDBB System
Sorabel e-commerce startup is a rebranding of Sale Stock which started its business in 2014. Sale Stock became the first e-commerce in Southeast Asia to implement the Try First Paying (CDBB) system.
The CDBB system makes consumers experience a practical and easy online shopping experience, but also gets satisfaction like offline shopping. Consumers are given the discretion to decide which clothes are suitable for them and return an outfit that does not fit directly to the courier who delivered.
Sorabel’s co-founder, Lingga Madu, once stated that her business model was the healthiest when compared to other e-commerce platforms in Indonesia.
In 2018, Honey claims the company has reached a break-even point (BEP) and is ready to make a profit. At that time, he compared Sorabel’s economic units with those of global fashion e-commerce players such as Asos and Revolve.
In 2019 Sale Stock rebranded into Sorabel, both for portals and applications. Carrying the “Be Fashionable Forever” campaign, Sorabel hopes to inspire and empower customers to always be happy.
At the beginning of his journey, Sorabel also laid off about 200 employees in 2016. Nevertheless, the fashion company succeeded in closing the Series B+ funding round, which was led by Meranti ASEAN Growth Fund.
Sorabel once announced that they closed a Series C funding round from investors, including Kejora Ventures, Ncore Ventures, OpenSpace, Shift, Gobi Partners, MNC Media Investment, SMDV, Golden Equator Capital, and Convergence Ventures.