Just a few days ago, reports of Chinese phone manufacturer, Smartisan, facing financial crises surfaced on the web. While Smartisan’s CEO refuted the statement, a new development which might be proof the company is indeed struggling financially has come to light.
According to cnBeta, a China-based online publication, Smartisan has received a lawsuit from Coolpad over money owed. The lawsuit was filed by Dongguan Yulong Communication Technology Co. Ltd, a subsidiary of Coolpad against Beijing Hammer Digital Technology (Smartisan).
The plaintiff claims it signed a contract with Smartisan to supply mobile phone parts worth over 10 million Chinese Yuan. However, after delivery of the goods, Smartisan is still yet to pay the remaining half of the cost. So far, there has been no response from Smartisan.
If Smartisan is indeed owing its supplier(s), it isn’t out of place to believe the reports that the company is facing financial challenges. As we have seen in the case of similar companies that have exited the mobile business such as LeEco and Gionee, unpaid bills are one of the proofs a company isn’t doing well.
READ MORE: Smartisan R1 gets Peacock Blue color variant
Smartphone sales have declined this year and while there are still some winners, there will likely be losers too. The sad thing is some companies may not be able to recover and will end up shutting down business.