Business owners inherit disaster, Kichink owes them over US$16,000, they claim

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Contxto – Small business owners are migrating to e-commerce platforms to continue operating despite the coronavirus (Covid-19) outbreak. But what happens when the middleman in the marketplace doesn’t pay you what a customer bought? 

According to hundreds of small business owners that use Mexican e-commerce Kichink’s platform, this is the reality they’re facing. For months now (even before the pandemic), vendors have claimed delayed payments from Kichink. 

It’s important that this case be brought to your attention for two big reasons:

• Vendors’ bad experience may leave many e-commerce businesses mistrustful of smaller marketplaces like Kichink. That places budding but perhaps more compliant platforms at a competitive disadvantage. Vendors may well just migrate to larger, more-consolidated platforms like Mercado Libre or Amazon.
• Money is tight for many small e-business owners because of Covid-19 and the inbound economic slump.

For now, we’ll only be addressing the facts. However, as new developments arise, we’ll provide you with updates.

The e-commerce conundrum

Before diving into the “he says she says” controversy of Kichink’s case, let’s first establish how the marketplace platform works:

• Vendors can display their goods on the system.
• Potential buyers can browse and shop through the marketplace.
• The site accepts and manages electronic payments on behalf of vendors.
• Kichink handles the logistics of delivering the item to the buyer for a fee.

Back in 2019, wiring e-commerce owners their funds took 10 calendar days. But at some point in 2020, it changed to range from 10 to 90 calendar days.

Nonetheless, vendors are now stating that Kichink is not complying with its established payment dates.

Here’s what we know:

• Vendors report not having received their payments as far back as August of 2019.
• No amount has been officially disclosed as to how much is owed. But there are claims that range from MXN$400,000 to MXN$700,000 (US$16,000 to US$29,000).
• Kichink has yet to disclose the motives behind these payment delays. Instead, it insists that it’s complying with its terms and conditions.

Now we got bad blood

In response, sellers have taken matters into their own hands. Here’s what they’ve done:

• Launched a WhatsApp group of affected parties.
• Created a Twitter account known as @KichinkNoPaga and #KichinkNoPaga that users tag every day showcasing their status with the marketplace.
• Launched a Change.org petition with over 1,200 signatures.

Social media, particularly Twitter, is filled with users and businesses that claim non-payment on Kichink’s end:

Kichink’s legal barriers

“Terms and Conditions” are those boring things that users rarely read until things go wrong. And given the back-and-forth between Kichink and its vendors, the platform’s Terms and Conditions are its primary defense against claims from affected users.

Here are the key highlights:

• Kichink’s Terms and Conditions do not establish a singular date, nor when they were last updated.
• In 2019, these Terms established payment would be made to vendors within 10 days. But, sometime in early 2020, they were changed to up to 90 days.
• These Terms also established that vendors’ continued use of the platform would be considered acceptance of those conditions.

Even then, there are users that claim that it’s not even complying with these 90 day terms.

And in case you’re not entirely convinced, here’s more sketchy stuff:

• The phone number displayed on its Terms of Use doesn’t work.
• Leadership from the startup has not come forward to address any of these issues.
• Most of its communication with vendors is via social media.
• Recently upon trying to enter its website, the following message was displayed:

And there’s no date in sight as to when the service will be re-established:

And that leaves one wondering if there will be further changes to its Terms and Conditions once the platform is online again…

Claudio del Conde (Kichink’s current CEO), alongside Claudia de Heredia, co-founded the startup back in 2013. Contxto reached out to them for commentary but received no response. 

In spite of it all, Kichink has yet to be slapped with a lawsuit. However, users on social media state they’re rallying to take legal action against the marketplace platform.

In any case, I don’t think this is the end of the matter. So as more developments unfold, we’ll make sure to keep you posted.

Wanna hear more? We recommend you listen to the following podcast episode: Qué considerar cuando se habla de Kichink. You can find the time stamp available in the description.

Related articles: Tech and startups from Mexico!

-ML