Fujian Putian "High Imitation Shoes" Storm, Alibaba Butterfly Effect!

Butterfly

Occasionally, flapping several wings can cause a tornado in Texas two weeks later.

China and even the world's important production base for shoes industry

In February 21st of this year, Alibaba announced that in 2010, the company had about 0.8% or 1107 "Chinese suppliers" to be terminated on suspicion of fraud. The company's CEO Wei Zhe and COO Li Xuhui resigned.

The accounts have been completely closed and have been submitted to the judiciary for investigation.

Subsequently, in view of Taobao's fake products and consumer rights protection issues, Alibaba chairman of the board of directors, Ma Yun, called on the media to pay attention to Putian and Quanzhou in Fujian. "To see, you will shock, that is the black industry chain, the fake base."

The media even openly alleged that according to incomplete statistics, more than 90% counterfeit sports shoes in the domestic market come from Putian, Fujian.

For a while, Putian, a prefecture level city on the southeast coast, was pushed to the center of the vortex.

The truth is what the reporter went to Putian to investigate.

Underground industry exceeds official output value

"According to the superior deployment, since November last year to June this year, we launched a special action to crack down on infringement of intellectual property rights and manufacture and sale of fake and shoddy commodities."

A person from the Putian Public Security Bureau told reporters, "however, the regionalization, industrialization and internationalization of such crimes are quite prominent. We will continue to maintain a high pressure strike in the future."

However, the relevant parties have not yet announced the results of the special action against the infringement of intellectual property rights and counterfeiting and selling of counterfeit goods in Putian so far. However, the cases scattered in the briefing of relevant departments are enough to make people startling.

In December 23rd last year, the Fujian police destroyed a large dens of counterfeit registered trademark products in Licheng District of Putian, captured 1 suspects, and seized 214 thousand pairs of fake Australian famous brand "UGG" snow boots, 26 thousand counterfeit Nike registered sports shoes and about 12000000 yuan involved.

In from May 21st to 24th this year, the Guangzhou Municipal Public Security Bureau successfully cracked a case of foreigners selling counterfeit sports shoes, and arrested 6 suspects (including 3 foreign nationals). They seized more than 1.8 pairs of fake Adidas shoes, and the value involved was nearly 10 million yuan.

According to investigation, an American registered in February 2008 in Guangzhou, Hongkong STYLASIA Co., Ltd., Guangzhou representative office, has long been engaged in selling counterfeit sports shoes provided by Putian to and outside the territory.

As of February 10th, the Putian city commerce and Industry Bureau has seized 32 computer mainframes, and has broken down 458 online shops, and has shut down many websites such as "Putian student street website", "Anfu home website", "Putian sports goods net", and so on.

"Relevant personnel of Hangzhou Public Security Bureau and Alibaba have made a special trip to Putian to investigate the fraud cases of Alibaba suppliers, demanding cooperation, strict confidentiality, and striving for major breakthroughs in a short period of time."

The Putian Municipal Public Security Bureau said, "the State Council's" doubles "(combating intellectual property rights and selling fake and shoddy commodities) - the steering group has affirmed the achievements of Putian's special action.

It is understood that the main practice of Putian's special action can be divided into two aspects: first, the website, which is known as "imitation shoes", "imitation shoes" and "high imitation shoes", or online shop based on the three party platform such as Taobao, will be included in the key tracking and monitoring scope.

Secondly, the online shop links that have not yet found the product of trademark infringement, but have a large amount of infringing goods pictures and so on, will be directly closed or screened by the network operators or access providers. The IP will also conduct investigation and handling of the operation of providing technical services for online trademark infringement operations.

With the production and sale of "high imitation shoes" giant, one after another, the industry in Putian is in a state of panic.

"Fake and toxic food is not wanted by anyone, but food safety problems that concern everyone can not be solved. How can counterfeit shoes be eradicated?"

A local civil servant in Putian thinks, "the price of counterfeit shoes is low, not only domestic demand is big, but also foreign demand is insufficient, there is demand, there is a market, this phenomenon will exist for a long time."

A person who has been stationed in Putian for sale in "high imitation shoes" has also told reporters that this special action is not uncommon in previous years. But every time after the storm, it is hard to prevent. "Unless the public security, industry and Commerce and other functional departments give up other jobs and carry out long-term special attacks, even if they contain Putian, what else will they do?"

In fact, Putian's counterfeit shoes "spring breeze blowing again" is not only a folk statement, but also a strong vitality of the underground industry from the summary of the past years' achievements in the departments concerned. In 2006 alone, the counterfeit Nike logo of the public security organs in Putian reached more than 120. In April 2007, a piece of material from the Putian Municipal Industry and Commerce Bureau said that in the past 3 years, the Putian industrial and commercial system has investigated and dealt with 294 cases of all kinds of foreign-related footwear trademark infringement cases, with a value of about 3000000 yuan and a penalty of 2 million 160 thousand yuan, confiscating more than 33000 pairs of famous brand sports shoes such as counterfeit Nike, more than 5000 pairs of shoes, more than 9000 pairs of shoes, more than 120 thousand signs, and pferred to 6 parts handled by the judiciary.

According to the above sources, only in Putian, the number of people engaged in the production and sale of underground "high imitation shoes" is over 100 thousand, of whom 2 to 30 thousand are engaged in the trade of "high imitation shoes". "Among these people, there are Putian locals, there are people from all over the country and even abroad. Putian can't do it, they will also fight elsewhere."

For Putian's annual sales of "high imitation shoes", the person said that the output value of the underground industry is at least no less than the local government's total output value of footwear.

Relevant data show that in 2010, the output value of Putian footwear industry was nearly 50 billion yuan, of which nearly 2 billion U.S. dollars were exported, ranking first in Fujian, employing more than 200 thousand people (500 thousand people were also reported), while Putian's household registration population was only 300 million.

Shoemaking is one of the pillar industries in Putian. It has more than 3000 shoe enterprises, and about 1000000000 pairs of shoes each year, ranking the top ten of the city's industrial clusters.

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Unique production conditions of the counterfeit shoes

Putian, with a land area of 4119 square kilometers, is the smallest city in Fujian province except Xiamen.

In such a small place, the reputation of these years is suddenly prominent both at home and abroad, because of the "famous" "high imitation shoes".

A widely spread view is that 1 out of every 3 pairs of Nike in the world are counterfeited, and their origin is from China, Vietnam and Columbia. At present, over 90% of the fake sports shoes in the domestic market come from Putian, Fujian.

There is no evidence of how statistics and sources of data can be found, but the fact is that "high imitation shoes" from Putian are most popular in the market, and the degree of popularity is comparable to that of genuine products.

"The materials and techniques of" high imitation shoes "produced in Putian are all in place, and the quality is higher than that of other producing areas. This is related to the long history of shoe making in Putian and the integrity of the industrial chain.

A local footwear industry in Putian said, "Nike, Adidas and other foundry factories in China are located in Putian."

More importantly, Putian has also been awarded the China footwear R & D design center, the China footwear industry information center, the Chinese shoe industry innovation and demonstration base, and the Chinese shoe export base, which is unmatched in the domestic shoe industry base. The Jinjiang, which is also called "shoe city", is no match for this aspect.

Putian's unique shoe making technology and industrial cluster advantages benefit from Taiwan's industrial pfer.

Putian is located in the middle of Fujian coast. It looks across the sea from Taiwan. It is only 72 nautical miles from Taichung city.

"Putian was the first place in mainland China to pfer the shoe industry in Taiwan. In the early 80s of last century, the footwear industry began to develop."

A government official in Putian said, "the main thing was processing."

The footwear industry in Taiwan has mastered the production and trade of more than 80% of the world's brand shoes.

"Putian imitation brand shoes should start in the 90s of last century."

The above footwear industry insiders said, "at that time, some of the stronger shoe factories in Putian began to work for international brand foundry, and the surrounding manufacturers bribed the employees of the franchised production enterprises to do everything possible to get their shoes and design drawings to hand, and then to copy them." in the past, the footwear manufacturers in the city of Putian said

Soon, the legendary story of imitation brand shoes began to circulate, and saw more profitable people.

"Do not belittle the counterfeit shoes in the gray area. Some of the rich are digging the first pot of gold from here."

These people said, "the boom period of counterfeit shoes is after 2005, and these two or three years have reached their peak."

According to the personage, in the heyday, thousands of workshop processing factories in Putian were producing counterfeit shoes. These underground processing factories were mainly distributed and gathered in seven steps of Putian, Hualin, Xin Du, Huangshi, Wutang and West Tianwei.

According to local government statistics on shoe growth, it seems that underground counterfeit shoes are also in the ascendant.

According to the "11th Five-Year plan" of Putian, the footwear industry will achieve an output value of 20 billion yuan by 2010, but this goal has been achieved two years ahead of schedule.

"Many underground processing plants are located in public houses, usually closed or closed at night."

The above footwear industry insiders in Putian said, "because of the steady stream of orders, even some regular shoe factories have joined them. Usually two production lines are used to cover up the sunshine, and more production lines are converted into counterfeit shoes."

The counterfeit shoes produced in this way are pported to all parts of the world through covert channels. With the increasing sales, the production skills gradually increase.

"The former counterfeit shoes are mainly sold abroad, so we know that there are not many people in Putian, and the domestic sales in these two years are already larger than those exported, and Putian has attracted wide attention."

The above personages said, "the counterfeit shoes produced in Putian almost include the world's major shoe brands, such as Nike, Adidas, PUMA, KAPPA, Timberland, Asics, BAPE, CAT, UGG, converse, Columbia, new balance, balance,", "and" and so on. Even the domestic brands such as Lining and Anta have been copied.

According to its disclosure, counterfeit shoes, the largest volume of Nike, Adidas second, "now the industrial chain extends, jerseys and sportswear is also counterfeit, but because the way to get the design pattern is blocked, many people are looking for people to design and produce according to the wear of NBA star players, and others buy new products from the market directly to the processing plant order."

"Let everyone in the world wear a name tag".

In Putian, there is an intriguing word in the circle of counterfeit footwear practitioners: let all the people in the world wear famous brands!

"The price of counterfeit shoes is 50 percent off of the official price."

A person who sells counterfeit shoes in Putian told reporters, "as long as there is a market, someone will fake it, so long as someone orders, there will be no counterfeit shoes that can not be bought."

As a result, many people bought and sold more, and the popularity of counterfeit shoes in Putian flourishing.

Earlier, the counterfeit shoe trading in Putian was mainly concentrated in the student street in the centre of the city.

A New York Times article once said that the student street is a two-way street. The shops on both sides are all imitation sports shoes.

One shop mimics the style of Urban Outfitters1 - bare brick walls and pipes, and emit simulated light from the fake windows.

Low level electronic background music, but most stores seem to pay more attention to business rather than aesthetic perception.

"The price of these shoes is about 12 dollars, and the quality seems to be no different from those of my wife who spent 85 dollars in the US," the author said.

According to the above personages who sell counterfeit shoes, the market of counterfeit shoes in Putian student street has been gradually vanished under the repeated attacks of the departments concerned.

However, this Volt has led to it.

"The centralized trading of counterfeit shoes in Putian suddenly formed at the end of 2007 in the Anfu District deviating from the city center."

These people said, "2008 is the most prosperous and beautiful period of Anfu market, many shops are decorated luxuriously, and LED display is installed."

What is dazzling is that many shops that run counterfeit shoes have names of famous cars, and BMW, Bentley, Ferrari, Hummer and so on.

"The legendary BMW boss, who only made 3 years of imitation shoes, made millions of dollars in the first year, and made 20 million in second years. Last year, he said he had ordered 600 thousand pairs of fake shoes from the processing plant, but he was arrested last Christmas."

The above sources revealed.

This person said, at that time, the shops in Anfu market were mostly locked by the shutter doors during the day, and there were few pedestrians in the streets. After nine o'clock in the evening, the shops suddenly became hot and crowded.

Not only counterfeit shoes, fake sports wear, all kinds of Shanzhai watches, mobile phones and electronic products from all over the place are also sold here.

According to a number of people who have been here, the market of counterfeit products in Anfu market is like "ghost market". Under the night sky, people are rushing, and buyers and sellers are rushing to and fro, having an adventurous secret pleasure.

At three or four in the morning, the noisy crowds were gradually dispersed, and dreamily restored the tranquility.

"Here is just a part of the imitation shoe trade. In the commercial chain of counterfeit shoes, buyers and sellers here are only intermediate links, and there are processing factories and their supporting manufacturers at the top. Dealers and consumers are the bottom."

In general, manufacturers of a pair of counterfeit shoes can earn a few dollars and sell them to consumers, who can earn half of the price in the official price of half off.

But now, Anfu market is also like the student street.

Reporters visited many times and found that most of the shops had been moved away, leaving only a lot of notices for the pfer shops and wall stickers which had not been completely cleared. Even late at night, it was hard to see piles of people here. Occasionally, two or three people were surrounded by a motorcycle.

The locals told reporters that this is a private counterfeit shoe paction between familiar customers, with a small amount of time, and a short time, and a few minutes away from each other.

"Now that the wind is so tight, who dares to go to Anfu market?"

These people said, "to trade, it is also an agreement between acquaintances to arrange guerrilla sites. Strangers are afraid to pick up the spot delivery lists. What if they are caught?"

According to the source, this season is also the most delicate period for counterfeit shoes trading. The reason is that the new money will be changed in the second half of the year, plus the current severe punishment. Buyers and sellers are more cautious.

"The best time to do business is around Christmas. At this time of year, logistics companies don't want to pick up small bills."

The above said.

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Counterfeit footwear business model

The emergence of counterfeit shoes in Putian has directly derived a series of related industrial chains.

"The most visible benefits are pportation, catering, entertainment, accommodation, rental housing and so on, which are inseparable from the daily operation of counterfeit shoes."

Putian, who sells counterfeit shoes in the past, said, "outsiders do not see such things as IT, customs agents, logistics, and so on, making more money than they can earn from counterfeit shoes."

In fact, the rise of Putian's counterfeit shoes and the popularity of e-commerce have played a role in boosting the fuel. Or underground operators have made full use of the convenience and secrecy of e-commerce.

"E-business, we also call network marketing. This mode is the easiest to copy, so as long as a person makes money, his relatives, friends, classmates and acquaintances will be brought into the industry."

These people said, "before there was no e-commerce, how many buyers can you find?

Hawking on the Internet is facing the whole world. Now everyone uses this way. "

The usual practice is to rent a house as an office location and find someone to build a B2B or B2C shop. One person or several people plus several computers can do business, specifically selecting the order of goods, network promotion and sales, logistics and express delivery.

In fact, ready to run counterfeit shoes can be opened in a matter of days. Operators do not even need to invest in online stores or internet promotion in the early days. There are professional companies to pack them up, and can wait until the operator gets paid.

Because of the need to face foreign countries, operators usually require more than six grades of English, but the salary is not bad. The average monthly income can reach up to ten thousand yuan.

"Facing the foreign countries, it mainly uses platforms such as Alibaba, Dunhuang net, eczl, ecplaza, ECVV and tradekey. Some B2C platforms only need tens of thousands of yuan a year. Because these people want to make quick money, some can upload thousands of fake shoes pictures on the Internet in one day.

China is Taobao, pat, etc., also has its own website.

The above sources said, "with customers to use MSN, QQ, e-mail and other ways, many times we need to use video."

For counterfeit shoe operators, the most important expense is network promotion.

"Foreign countries mainly use Google search engine to promote, this is more expensive, high click one dollar a time, but the effect is better, generally average 100 hits have 5 single paction."

The above said, "the domestic is mainly rely on Baidu, click on 1 to 2 wool, the effect is very poor, sometimes tens of thousands of dollars invested in a short time will be clicked, no single deal."

Internet trading has undoubtedly increased the sales of counterfeit shoes in Putian, but accompanied by frequent fraud.

"In the past, fraudulent foreign buyers often happen, customers buy counterfeit shoes, they need to pay deposits in advance or pay in full and then deliver the goods. Many people take advantage of this and do not deliver or receive less money after they receive the money."

Those people said, "some people, one day, the income of" black bill "has 5000 - 6000 dollars, so that it turned into a job last year.

But "black bill" will be labeled after being complained, and can only be exchanged for one place, and soon the payment method will be changed.

The existence of "black bill" is mainly in the way of Western Union, which was generally accepted in the past. As a result of the arrival of accounts immediately, some operators began to withdraw money.

The above said, "but now can not be done, all take third party payment, goods can not get money without arrival."

However, the on-line payment of the third party makes it impossible for the "black list" to take the opportunity, but the seller of the counterfeit shoe adds risks.

"Now a lot of foreigners are starting to eat black. They have drilled the third party to pay for the empty space. After receiving the goods, they go to complain about the quality problem or counterfeit the famous brand, so the goods are taken away, the money has to go back, and we are dumb eating Coptis chinensis."

The above personages said, "some foreigners see this point and do their jobs black and black, just like we used to treat them black sheets. Now they do nothing like this."

It is understood that the current trading mode of counterfeit shoes pactions, foreign pactions mainly use VISA, Master Card and other payments, the domestic use of Alipay, fortune paid third party payment.

"PayPal has also been useful for some time. Just like Alibaba, branding complaints are too many to use."

These people said.

The widespread implementation of the third party payment method has also increased operational pressure on counterfeit footwear business.

"Previously, we could use customers' prepaid money to organize the supply of goods, and now the third party payment of funds can not be taken out in advance, and the cost and threshold of business pactions have been raised."

These people believe that "selling fake shoes online is a small business venture, attracting many college students, university graduates and small entrepreneurs. Now they are entering capital management. It's impossible to make money as casually as they did in the past few years."

However, most of the counterfeit shoes that are traded through B2B are remittances because there are more fixed customers, while B2C generally uses third party payment.

The person also revealed that the online counterfeit shoes operators to the student street, Anfu market pick-up, basically are small and small sellers, the real big operators are door-to-door, "a lot of big sellers, in Guangzhou, Shanghai, Beijing, northeast and other places have stalls, foreign buyers through the stall order, the seller back to Putian organization source, directly pported to the field to foreign buyers."

"Buyers of counterfeit shoes are available all over the world, with the largest number of B2B customers in the Middle East, and more homes in North America."

The above said, "now the domestic sales volume has surpassed that of foreign countries, not only on the Internet, but also in group buying, and through many channels to enter the wholesale market and brand stores, and UGG's counterfeit shoes sold very well in the Northeast last year."

Putian shoe industry besieged city

Once the pride of Putian, the title of "shoe city" has long been forgotten. In the eyes of the outside world, the pronoun of Putian shoes is "authentic fake".

"There are some misunderstandings outside the world that counterfeit shoes are not unique to Putian."

Shi Qingfang, chief of the Putian economic and Trade Commission's operation section, said.

However, it is an indisputable fact that the shoe industry in Putian has made a late start.

Jinjiang, which later started in Putian, has changed from "shoe capital" to "brand capital".

At present, the footwear industry in Jinjiang has 12 listed companies and 26 listed reserve enterprises, but no one in Putian shoe industry has entered the capital market.

Contrast found that in terms of total output value of footwear industry, Jinjiang is only slightly higher than Putian, but the output of shoes is much higher than that of Putian.

"The gap lies in the added value of brand management."

A number of Putian shoe enterprises in charge were interviewed.

Shi Qingfang also said that the footwear industry in Putian was lost to Jinjiang during the last 90s and 2000 of last century.

At that time, Jinjiang shoe enterprises invested heavily in "making brand", while Putian shoe companies still kept the three acres of OEM.

"Now the brand can not catch up, we must take the road of differentiation to attack the functional shoes."

Shi Qingfang said, "the world top brands such as Nike, Adidas, Lei Bao, Puma and other sports shoes are all produced in Putian, which shows that Putian shoemaking technology has reached the international first-class level."

As early as 2007, Cai Jinhui, chairman and President of Voight group of Putian, said that it was very difficult to create brand. "Now 1 hundred million of advertising investment is not necessarily worth 10 million of the past."

As the footwear industry structure has not been upgraded, the Putian footwear industry, originally developed by Taiwan funded enterprises' "incoming processing" mode, has also extended to the brand of shooing for Jinjiang footwear enterprises.

"Over the years, most of the shoe making enterprises in Putian have been doing export orders, and have become accustomed to copying each other. The homogenization of products, low price competition and low profits have been difficult to change."

A shoe manufacturer in Putian said, "with the appreciation of the renminbi, rising prices of raw materials and rising labor costs, processing enterprises will not be able to continue."

This personage thinks, under this kind of management situation, shoe enterprises are hard to find a good way besides producing counterfeit shoes.

A lesson from the past is that in the past 5 years, Wenzhou is also the shoe industry. The total number of shoe enterprises has been reduced by more than 2000.

The brand shoe companies in Jinjiang are pferring large quantities of orders to the foundry enterprises to pass the cost pressure.

"In fact, there has been a misunderstanding in the development of the footwear industry in Putian. With such a good technology and network marketing capability, why not make full use of it?"

A counterfeit shoe operator in Putian said, "in the fight against counterfeit shoes, the government can introduce preferential support policies to encourage and guide the production and operation of counterfeit shoes for Putian's footwear industry breakout service."

He believes that footwear B2B and B2C are emerging markets, which are the third major subdivision areas after clothing and 3C appliances. Now the market share of each platform is very small, but the market is huge.

"Footwear in Putian is famous for its low price and high quality, which is very suitable for domestic consumer demand, especially for price sensitive two or three line urban and urban customer groups."

The person said, "now the network has begun to enter the countryside, the prospect of footwear e-commerce is very attractive."

In fact, the Putian municipal government is currently guiding footwear sales to the domestic market. Putian shoe enterprises have set up more than 600 sales outlets in Chengdu and Northeast China.

"The next step is to expand the domestic market in Putian footwear enterprises, and the target is Zhengzhou, Kunming and other places."

Shi Qingfang said, "the pformation of the footwear industry in Putian does not necessarily depend on the brand. It is a direction to produce functional shoes that meet the needs of the domestic market through technological innovation."

Shi Qingfang also revealed that Putian's leading shoe enterprises, double Chi Industry and Huafeng shoes industry, will strive to be listed on A shares next year, in order to achieve bigger and stronger.