Why Laura Password shut the store when returns doubled

On the eve of the 2024 618 shopping festival, other women’s-wear shops were racing the promo. On Douyin, Laura Password changed the livestream title to a farewell.

Nearly ten million fans across the web, media talk of “tens of billions” in annual sales, a single livestream once past a hundred million yuan—by content-commerce common sense, that was the moment to pour on more volume. They stopped.

Later, people from the brand told Phoenix’s Storm Eye straight: before closing they had already lost money for more than a year—tens of millions of yuan in a single year. The brand “could keep going”; they even had plans—raise prices, change the style. They shut it anyway.

Outsiders read the shutdown as “they couldn’t hold on.” The sharper question is: why not grind until the name itself turned sour?

First they flew: original womenswear met the livestream boom

Laura Password takes its name from founder Laura (born Wang Shanshan). Public notes usually place the brand’s 2016 launch in Hong Kong with a Shenzhen company; in 2017 it appeared at Milan Fashion Week. The positioning was not cheapest white-label—it was original, mid-to-upper womenswear.

The climb happened on Douyin. Live selling started around May 2020—later they recalled watching mothers switch to buying clothes online and going all-in. Warehouses grew from a few thousand square meters to more than ten thousand; sales doubled. Average ticket sat near two hundred yuan. Media repeated their peaks: tops of apparel livestream charts, festival clothing charts, one session about RMB 140 million in roughly eleven hours (Storm Eye).

The formula looked clean: content pulls people → livestream closes → fans stick → open the next show. When GMV looked good, few asked how many shipped pieces would come back the way they went.

Returns doubled. Traffic cost ten-x’d

What tore the books open were two figures they gave themselves.

To Storm Eye: when the brand took off in 2021, return rates were about 30–40%; before closing, 70–80%—roughly double. Every return still costs shipping, storage, freight, packaging—they put the per-order cost near ten yuan. They long avoided packing shipping insurance into the offer, unwilling to shift that cost onto people who keep the clothes; returns did not fall.

Traffic cost, they said, rose about 10×. When fewer sellers competed, content could still feed reach; when everyone piled in, it became an auction. Catching this livestream does not guarantee the next—like a shop on the main street when the road suddenly under repair.

Add the low-price wave and copy speed: an original sample run can cost three or four thousand yuan, sometimes three or four tries; finished goods go for lab tests; real silk fabric alone can run one or two hundred. A small workshop can skip tests, pass chemical coating as “silk,” clone a look in a week, and undercut on price. Differences the eye misses in a thumbnail still lose to algorithms and price comparison that push traffic cheaper.

So the ugliest math in livestream womenswear appears: GMV can be huge while few garments stay; of what stays, you still subtract ads, storage, labor. Noise is not profit.

They tried holding on: cut prices, cut floors—still lost

Closing was not one night’s temper.

At year-end planning they gave themselves until May Day: six more months to see if perception could turn. Prices came down—T-shirts from about 150–200 yuan to 70–100, cost still fifty-plus; street tees at thirty-odd yuan might cost only a dozen. They cut labor and space, not fabric standards: seven floors to one, four people’s work done by two. Volume ticked up; margin thinned; they still lost money.

Warehouse rent, equipment, payroll—tens of millions a year. After gross margin, net looked like working for free. From 2023, nearly every month ran red; by shutdown the hole was “tens of millions in a year.”

Raise prices? In theory yes. Shoppers had anchored on the discount; climbing back would “not feel right.” Keep selling at a loss for scale and the brand name survives while the books rot. Push into 618 and volume jumps again—if after-sales break, the last memory is worse.

So they stopped before the festival: not for lack of a plan, but because keeping the fight meant fighting their own name.

Laura compared the brand to a child; she wore sunglasses to the airport so questions would not make her cry on camera. Kaiser—the QC lead, and in public reports her husband—said it colder: the heart was already tired; when it ended hardly mattered. The old Douyin account later became “Kaiser,” old videos wiped, still testing womenswear and skincare—name changed, battlefield not fully left.

What “not holding on” refused

Everyone in womenswear e-commerce knows high returns as weather. Laura Password cuts sharper: this was not a tiny shop dying on cash—it was a headliner that admitted it still had options, and chose stop.

Refusing to grind meant refusing several “shoulds”:

Refuse covering higher returns with bigger GMV. Refuse smashing quality to win the bid. Refuse one more 618 bet that “volume will bring profit back.” Refuse turning the name in buyers’ minds into the last promo in after-sales hell.

Mechanically it twists the platform story that more sales equal more profit. Livestreams cut the cost of “trying on,” and raise impulse buys and casual returns; shipping insurance and no-return refunds shift friction onto sellers. Original mid-high brands carry fixed costs—samples, tests, better cloth. Low-price clones can bet odds: sell a third or so to break even, treat the rest as gravy. When both speak the language of feeds and price comparison, the picture often wins—not the fabric.

For anyone still in a livestream room, the residue is not a sermon about “sticking to quality.” It is a colder spreadsheet: return rate, traffic multiple, copy speed—whichever eats gross margin first is your shutdown clock.

They later said they still want another brand, even offline—because offline you can touch the cloth. That is the next game.

This round’s period is already clear: annual sales can look brilliant; after returns double and traffic costs ten-x, grinding is not courage. It is mortgaging the name to bad arithmetic.