Pang Dong Lai, the Henan retailer known in China for paying above the market and for a management style it calls "freedom and love", is shutting its Xuchang Shenghuo Guangchang store in December. The chain's founder, Yu Donglai, announced it in a livestream on 7 August and set out his reasons in a public post two days later.
The store is twenty-four years old. It turns over about 2 billion yuan a year and clears more than 100 million in profit. It is closing anyway.
The reason he gives is not trade. Around 2015, he wrote, staff did not apply company rules when leases were signed: the contracts were not put on a common form, and some tenants' rents were later pushed to levels he calls far outside fairness. The agreements were valid, which left the company unable either to run the site cleanly or to leave it. The lease reaches its end this year and the company is not renewing. Other reporting adds the building itself — ageing fabric, poor parking, a layout that no longer works.
What happened next is the part that moved up the ranking. Employees of the store told Chinese outlets that they are being transferred to other branches to do the same work on the same terms; one said take-home pay after social insurance and the housing fund is still eight to nine thousand yuan a month. On 16 August the store's office head said no one would lose their job over the closure and that staff would likely move to the Keji Guangchang branch.
The company published figures in May putting average take-home pay across all its operations at 8,974 yuan for 2025 and 9,598 yuan for January to March 2026. In June a clip from an internal talk circulated in which Yu said the company's long habit of paying beyond expectations had a downside — that it could leave people misjudging their own market value — and that he wanted a more rigorous pay system. Accounts online read that as a pay cut coming. He and the company denied it.
Why it is on the board
It was third on Weibo's hot list and also on Baidu's — the two lists we read for China, which is unusual for a single company story. The discussion is not about the closure. It is about whether the staff would be looked after, and the answer being reported is that they were moved rather than cut.
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