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source: time weekly author: zhang yijing

as the school term is approaching, there was an "earthquake" in mothers' circle of friends, as yet another established educational training institution was caught up in a "closure" storm.

recently, topics such as qinhan hutong's "running away" and "bankruptcy" have rapidly fermented on social platforms such as xiaohongshu. qinhan hutong is a well-known chinese studies training institution that has been operating for over 20 years.

subsequently, qinhan hutong issued a statement acknowledging that its operations had encountered huge challenges, and the company's core team was negotiating with potential investors on matters such as debt-to-equity swaps and equity transfers, in order to resume normal operations as soon as possible, quickly integrate the museum's resources, and do its utmost to protect the rights and interests of students.

on the morning of august 28, when the reporter visited the qinhan hutong headquarters on zhongchun road in minhang district, shanghai, he found that the door of the on-site employee office was closed, leaving only a student reception desk to receive visiting parents.

image source: photo taken by times weekly reporter

public information shows that qinhan hutong was established in 2002 and mainly provides chinese culture training services for children and adults. the institution has opened more than 100 offline campuses in cities such as beijing, shanghai, shenzhen, guangzhou, hangzhou, nanjing, and ningbo, providing three major courses: calligraphy and painting, appreciation classes, and chess and music. it serves nearly 80,000 heavy paying families offline. in 2021, qinhan hutong achieved revenue of more than 700 million yuan.

in addition, qinhan hutong has received three rounds of financing totaling over 260 million yuan. the company received an angel round of financing of 18 million yuan from wanxin media at the end of 2017; completed a round of a financing of 100 million yuan in january 2019, with investors including yicun capital, hujiang investment and suzhou huilihua; and completed a round of b financing of 150 million yuan in march 2020, led by mingde heritage group.

encountering business crisis

on the evening of august 26, the wechat public account "qinhan hutong national studies" published "a letter to qinhan hutong students and parents", which read: "the company has encountered huge challenges since it started operating last year. senior executives have left one after another. the founder led the core team to verify the company's assets and took measures such as mortgage loans and equity financing to withstand the high pressure of capital turnover several times."

image source: wechat public account qinhan hutong guoxue

qinhan hutong stated in the letter that in mid-august 2024, some employees posted "bankruptcy" comments on social media, which quickly turned into widespread panic due to the previous delay in salary payment, and the normal operation of various campuses was seriously disrupted. in response, the founder and core team immediately set up an emergency operation team to communicate and deal with the situation.

in addition, qinhan hutong stated that with the support of relevant industry associations, the company's core team is actively communicating with potential investors to negotiate matters such as debt-to-equity swaps and equity transfers, in order to resume normal operations as soon as possible and minimize student losses.

at the same time, the company will quickly integrate the resources of the library area, and will arrange the affected students to other library areas where teaching activities are carried out normally as soon as possible, and make every effort to protect the rights and interests of the students; and establish a close communication mechanism with all students, parents and employees, and adopt a non-evasive and non-avoidant approach to face the current temporary difficulties, actively implement the main responsibilities of the enterprise, and properly handle emergencies.

the times weekly learned that qinhan hutong has opened more than 100 offline campuses across the country through self-operation and franchising.

dianping.com shows that as of august 27, it has more than 40 stores in shanghai, and only 13 stores, including the zhongshan park branch and the xintiandi branch, are open for business. the reporter called the zhongshan park branch, xintiandi branch and other stores, but the phones were all turned off. in addition, qinhan hutong's stores in hangzhou, ningbo, nanjing and other places are also shown as temporarily closed.

according to the national consumer association's 315 smart sunshine public display, as of the evening of august 27, the agency had received a total of 23 complaints containing the words "qin and han hutong".

the times weekly reporter found that 23 of the above complaints occurred in august this year. these complaints involved qinhan hutong's branches in shanghai and hangzhou. the complaints all included refunds, and the amount of consumption ranged from 11,300 yuan to 60,780 yuan. it is worth noting that there were 9 complaints with a consumption amount of 40,000 yuan or more, accounting for nearly half.

image source: national consumer association smart 315 platform

some students still have nearly 40,000 yuan of lessons to complete.

on the morning of august 28, when the reporter visited the qinhan hutong headquarters on zhongchun road in minhang district, shanghai, he found that the door of the on-site employee office was closed, leaving only a student reception desk to receive visiting parents.

image source: photographed by times weekly reporter

image source: photographed by times weekly reporter

faced with the closure of multiple offline campuses in qinhan hutong, parents at the scene were inevitably emotional. one parent questioned, "it's the last few days of summer vacation, why can't we let our children finish these few days of classes properly?"

xia yue, a parent of a student in shanghai, told reporters that she first saw the news in the parents’ group and her first reaction was that she did not quite believe it.

"because qinhan hutong has many branches in shanghai and is very large, and my child has been studying there for several years. although the sales staff has changed several times, the teachers have rarely changed, and the children's feedback is also good. it feels quite stable."

xia yue said that she bought a general course package with more than 400 hours of lessons for her child before the epidemic, which cost 36,800 yuan. "because chinese studies were popular at the time, many people were studying, and the institution was near my home, plus the general course package included go, calligraphy, chinese painting, flute, guzheng, etc., so i bought it for my child. at first it said it was valid for three years, but i didn't take it much during the epidemic, but later it said it could be used for more than three years."

according to xia yue's estimation, there are still about 7,000 yuan worth of class hours that have not been used.

there are many parents who are in a similar situation to xia yue. in addition to the scene, there are also parents on xiaohongshu who said, "we were still in class on saturday, but on monday night they said the school was closed... parents can't do anything, and the exam is halfway through!" there are also parents who said that their children have been studying chinese painting and calligraphy at qin han hu for ten years, and just renewed their lessons two months ago, and nearly 30,000 yuan has gone down the drain. in addition, the reporter also saw in the rights protection group that parents of students in beijing reported that there were still 300 classes that had not been used, worth about 40,000 yuan.

image source: rights protection group

it should be mentioned that as early as 2022, the ministry of education and 13 other departments issued the "opinions on standardizing non-subject extracurricular training for primary and secondary school students" (hereinafter referred to as the "opinions"), requiring training institutions not to collect fees in one lump sum or in disguised forms such as recharges or cards for a time span of more than 3 months or 60 class hours, and the fees shall not exceed 5,000 yuan.

as for how the remaining class hours will be handled, the on-site staff at the qinhan hutong headquarters issued a handling agreement to the reporter.

according to the agreement, qinhan hutong offers three solutions: continue to take classes in the original museum or other directly-operated museums in shanghai, exchange them for other educational resources, or exchange them for online course resources on public welfare platforms.

in response, some parents signed the agreement with the company's official seal. however, some parents believed that qinhan hutong's proposal lacked sincerity and refused to sign the agreement.

image source: provided by on-site staff and photographed by times weekly reporter

in addition, in response to some parents' doubts about the fact that two subsidiaries of qinhan hutong in minhang district, shanghai had long been approved to cease operating schools, on-site staff said that the two companies corresponded to the minhang gumei campus and xingbao campus. currently, these two campuses have been merged with other campuses and have indeed stopped operating.

according to the reporter's inquiry, in april this year, the application for the termination of the qinhan hutong minhang first branch was approved by the shanghai minhang district education bureau. in july, the minhang caobao road branch also received approval to terminate the school.

image source: shanghai minhang district government official website

while delaying wages, the company was renovating its new headquarters

huang zong, a former employee of qinhan hutong, told the times weekly that his shanghai tianshan branch had experienced delayed salary payments in february this year. the salary that should have been received on february 10th was not received until the end of march.

in his opinion, the recent outbreak of various news about qinhan hutong on the internet is mainly due to the company's arrears of employees' salaries for july and august.

he pointed out that although there were salary arrears in february and his tianshan hall still owed about 700,000 yuan in rent, the employees did not take drastic actions as the company was still able to come up with money to decorate its new headquarters on zhongchun road in minhang district, shanghai.

"the current situation is completely different from the one in february during the spring festival. in previous years, summer vacation was the peak of business. most teachers worked overtime during the summer vacation. some worked six days and rested one day, and some worked seven days and rested zero days. after working hard for two months, but not seeing any salary, it is naturally difficult for employees to accept it."

however, another employee interviewed at the shanghai headquarters said that his salary had been paid normally before july this year. he said that the delay in tianshan pavilion's salary payment may be due to the supervision of the account.

in addition, wang li, an employee of a museum in qinhan hutong in hangzhou, told reporters that she also experienced delayed salary payment in april this year.

an interviewee showed the reporter an internal letter that was suspected to be from qinhan hutong officials to employees. the letter mentioned that recently, due to the dual impact of capital turnover difficulties and external news, the company is facing unprecedented operating challenges. to date, the company still has not raised enough funds to pay the salaries of all employees and has to make a difficult decision: temporarily postpone the payment of july and august salaries.

in addition, the letter also stated that in order to eliminate employees' concerns and doubts as much as possible, the company has formulated a detailed salary deferral agreement to clarify all outstanding amounts and the company's payment deadlines. after completing the august salary calculation in early september, we will actively communicate with each employee about the specific amount details and sign the corresponding agreement online starting from september 2 to ensure that everyone's rights and interests are protected to the greatest extent.

in this regard, wang li said that she was not optimistic. she was already extremely disappointed by the company's repeated postponement of the payment of july salary, and this time she felt it was a blank check.

image source: provided by the interviewee

it is not uncommon for educational institutions to close down

qinhan hutong, which is now in crisis, once played the role of "white knight".

in 2021, the english teaching and training institution "cinostar xinnuo international children's english" was exposed to have suspended classes and run away. qinhan hutong once provided public welfare assistance to the students and parents of xinnuo international children's english, providing students with 20 hours of offline appreciation classes and art (calligraphy, chinese painting, go, guzheng) courses.

at that time, qinhan hutong's annual revenue exceeded 700 million yuan, and the company had just completed a 150 million yuan series b financing in the previous year, making it the most popular company at the time.

now, with the closure of many stores in qinhan hutong, many institutions have also expressed their willingness to accept students from qinhan hutong on platforms such as xiaohongshu. in just three years, the role of qinhan hutong may change from "rescuer" to "rescued", which is really regrettable.

in recent years, news about the closure and bankruptcy of old-established educational and training institutions has become common, and qinhan hutong is not an isolated case.

in july this year, roland digital music education, a well-established music training institution that has been operating for more than a decade, was reported to have shut down some of its offline operations. on july 28, roland digital music education’s beijing headquarters publicly announced: “the company’s cash flow is broken. continuing to insist will continue to increase the company’s debt to students, parents and employees, which will be even more disadvantageous to students, parents and employees. therefore, this campus will suspend offline operations from july 29. the company is studying the possibility of online teaching and maintaining communication with government departments.”

earlier, many educational institutions including meiya and gymboree were also caught up in the closure storm. as the closure of educational institutions further fermented, the offline "fast food" education and training model also triggered heated discussions in the industry.

some people have suggested that a prepaid security mechanism should be established and placed in a bank escrow account, rather than having all operating risks borne by consumers.

in this regard, a lawyer said: "bank custody can certainly be one of the options, but the custodial loan can also be easily bypassed." he pointed out that from some custody in the financial industry, it can be seen that in many cases, custody is only the custody of the operating institution, not the custody of consumers and investors. "whose orders does the custodian institution obey to transfer the money to the operator? this is the core issue."

so how should consumers protect their rights? tang shixuan, an expert at kant think tank and a lawyer at beijing yingke (shanghai) law firm, told reporters that first, consumers should keep the contract, payment voucher, communication record and other evidence signed with the educational institution for subsequent rights protection; second, consumers should try to negotiate with the educational institution to solve the problem, such as requesting a refund or continuing to perform the contract; if the negotiation fails, consumers can file a complaint with the local consumer association, education department or market supervision department to seek help; the last option is legal means: if the above means cannot solve the problem, consumers can consider using legal means to protect their rights, such as suing the educational institution.

however, tang shixuan also pointed out that in the process of protecting their rights, consumers should remain calm and rational and avoid taking extreme actions or words so as not to affect the effectiveness of their rights protection.

(the interviewees xia yue, huang zong and wang li are all pseudonyms)