Chinese company risks $4.2M loss due to employee’s pricing error

A room with washing machines in it.. Illustation photo by Unsplash

Citing Red Star News, the South China Morning Post reported that this pricing error led to over 40,000 orders within 20 minutes on the evening of Aug. 28. The orders generated 40 million yuan in sales compared to the 70 million yuan worth of products at standard prices.

Following the incident, the company issued a public apology and requested customers to cancel their orders.

According to The Star, the firm’s statement also noted that most buyers ordered multiple units "in a professional way," indicating that businesses looking to resell for profit, rather than individual bargain hunters, likely placed the orders.

The company reported it employs only six people and has been struggling with low profits amid economic downturns. It also released a video featuring the remorseful employee who made the error, stating her inability to personally compensate for the mistake.

"I am deeply sorry for my blunder. By the time I realized it, 20 minutes had passed," she remarked in the video.

"I cannot afford to cover the losses even if I sold everything I own."

Following the company’s appeal, a customer surnamed Wang reported canceling her order of three machines—two normally priced at 1,699 yuan (US$240) each, offered at 299 yuan, and another usually priced at 2,499 yuan but listed at 439 yuan—after discovering the deal on social media.

The local market supervision authority said it is currently investigating the pricing mishap.

Lawyer Zhao Liangshan from Shaanxi Hengda Law Firm told The Paper that while companies must honor orders if prices are intentionally misrepresented to attract customers, they can also seek court intervention to nullify contracts due to genuine errors, thus allowing them to refund customers without fulfilling orders.