Jumei.com Shuts Third-Party Store Over Fake Products

on August 4 2014 | in Digital Retail | by | with No Comments

Jumei, China, e-commerce, counterfeit goods, Chinese online shoppers

Top Chinese cosmetic e-retailer Jumei.com has banned an outside vendor from its website after an investigation revealed that many of the products it was selling to other e-commerce platforms in China were fake.

The vendor, Belle Boutique, apparently sold knock-off watches, bags, and clothes under international luxury brand names like Hermes, Burberry, and Armani, though the products were manufactured in China. News sources linked the bogus operation to Xiangpeng Hengye, an offline retailer in the city of Sanhe in the Hebei province of northern China. Belle Boutique has victimized several Chinese e-commerce platforms, including Amazon.cn and JD.com, and has even gone so far as to forge several product certifications for its counterfeit wares.

According to Lu Zhenwang, founder of Sanghai Wanqing Commerce Consulting, the story is an all too familiar one.

“The selling of fake goods online and off-line, ranging from liquor, cosmetics and clothing, is very common in China,” Lu said in an interview with the Global Times.

Doug Young, a financial journalism professor at Fudan University, says that it can be difficult for operators of e-commerce platforms to make sure that the goods their vendors are selling are authentic.

“It’s hard for the platform operator to ensure the quality and authenticity of goods offered by these third-party merchants, since there are often hundreds or even thousands of such merchants on many such platforms,” Young said.

Jumei reportedly apologized and has removed all of Belle Boutique’s products from its website last week. An investigation into the vendor is pending.

Young says that Jumei, a company expected to generate sales of $4.4 billion this year, did not have the business experience to curb the fraud.

“Jumei is a much younger company and has much less experience in the business. So it’s not really a huge surprise that it is still trying to figure out ways to ensure that fake goods aren’t sold on its platform by third-party merchants.”

image credit: jumei.com

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