China has long been known for offering counterfeit goods, and now the country is admitting to this practice. According to the official Xinhua news agency, over 40% all goods sold online in China during the last year were either phony or of poor quality.
Meanwhile, just a mere 59% of all items sold online in China last year were genuine or of proper quality. The report has been delivered to top lawmakers in China who say that they are surprised by the statistics.
For years, China has been trying to change its reputation for being a flagrant distributor of goods that are pirated and not legitimate. This has made breaking into the massive Chinese market extremely difficult for global brands.
Indeed, brands that have tried to achieve success in China, such as technology company Apple and luxury retailer LVMH, have seen knock-off products quickly produced and distributed to unsuspecting buyers. These phony goods are almost always of very poor quality, and they damage the reputation of the legitimate brands when consumers discover that the goods that they were suckered into purchasing are just merely cheap imitations.
The issue has affected Chinese online shopping platforms as well. The Chinese online shopping business Alibaba has been fighting for a long time to remain off of a blacklist in the United States that identifies companies known for offering customers phony merchandise. Alibaba has experienced heavy pressure this year, as the company is still known for selling fake goods.
In China, lawmakers have been pressing for “accelerated legislation in e-commerce”, so that Chinese consumers can be better protected when shopping online. They also want to establish and clarify the rights of consumers and the responsibilities of sellers, and they say that more supervision is desperately needed.
However, the country is still having a hard time ensuring the protection of the country’s consumers. The counterfeit merchandise industry is massive and difficult to bring down, while offenders are hard to catch. Nearly 80,000 complaints were filed in regards to fake goods last year.
China has seen a rapid emergence of online sales. More than $441 billion in online sales in China were made in 2014.