Meike Home Furnishings (600337.SH), long billed in China as a leading high‑end furniture name, has been exposed in recent weeks for withholding employee pay and requiring staff to sell company products to recover owed wages. Current and former employees say the practice—introduced after wage arrears began in June 2025—persisted into the autumn and was formalised as a condition for finalising exit agreements. One former employee from the northeast reported being owed roughly RMB 40,000 and having recovered about half of it by posting furniture for sale on social platforms.
Workers described a blanket “sell to offset” arrangement that applied beyond sales staff: market and administrative employees who signed resignation agreements were reportedly told they must sell an equivalent value of furniture before the company would pay outstanding salary. The practice highlights acute cash‑flow stress inside the group and has prompted public anger, potentially exposing Meike to labour disputes and regulatory attention.
The wage revelations come as Meike pursues an ambitious, and contentious, pivot into high‑tech hardware. In December 2025 the company disclosed a deal to acquire control of WanDeWei (万德溙), a maker of high‑speed copper cables and intelligent loopback test modules used in server clusters, framing the move as a strategic shift from traditional furniture manufacturing into information communications technology. The announcement briefly sent Meike’s shares surging after a January 5 resumption of trading, only for the stock to retreat from a recent high of RMB 4.27 to RMB 3.00 by January 22.
Meike’s funding squeeze is reflected in its recent results. The group reported RMB 2.223 billion in revenue for the first three quarters of 2025, down about 10% year‑on‑year, and a net loss attributable to shareholders of RMB 220 million. The company warned of a full‑year loss for 2025, which would mark a fourth consecutive annual loss after cumulative losses since 2022 exceeded RMB 1.6 billion. Meike also has suspended operations at two Tianjin subsidiaries from January 1, citing asset assessment and preparations for potential debt restructuring.
The juxtaposition of an acquisition into industrial computing infrastructure while wages go unpaid and factories pause is stark. Investors have flagged the deal for closer scrutiny; the Shanghai Stock Exchange has questioned the company about the transaction and the share price swing. For employees and customers the immediate problem is reputational and practical: unpaid wages, disrupted production, and the prospect that corporate resources are being redirected to a risky diversification while core operations deteriorate.
This episode sits at the intersection of China’s broader economic pressures and recurring questions about corporate governance. The furniture sector has been squeezed by weak consumer spending and the property market slowdown, pressuring firms that once rode an outward boom in housing‑related consumption. For Meike, a brand whose image rests on premium positioning, the combination of falling revenues, repeated losses and now publicised labour grievances threatens both its market credibility and its ability to execute any credible turnaround.