Online platforms like Temu have become popular globally and pose many challenges for small businesses.
In early October, Temu entered the Vietnamese market and received a lot of attention from the consumer community.
One of the main reasons why Temu received attention is that the platform offers a variety of modern-style products, focusing on bringing a seamless shopping experience with fast delivery times and affordable prices.
The reporter's survey showed that the products sold on Temu are very diverse, supplied directly from China with low shipping costs or even free thanks to effective marketing and logistics campaigns.
Temu has just officially entered the Vietnamese market.
Temu has just officially entered the Vietnamese market.
However, the emergence of many counterfeit and intellectual property infringement products on Temu is posing a threat to small businesses in Vietnam, especially electronics retailers.
Suspected counterfeit, poor quality goods
Counterfeit goods have been a widespread problem not only in Chinese retail stores but also on Chinese e-commerce platforms.
Reports indicate that a significant proportion of goods sold on Chinese e-commerce platforms are counterfeit.
In 2021, for example, U.S. Customs and Border Protection seized more than $1.3 billion worth of counterfeit goods, many of which originated in China.
Popular counterfeit items on Chinese e-commerce platforms include Fashion and Accessories (fakes of brands such as Nike, Adidas or Louis Vuitton);
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Electronics (popular counterfeit products such as Apple products).
Pharmaceuticals in particular, with counterfeit drugs and healthcare products causing significant concern.
An authentic product costs around 6.99 million VND from a famous brand.
But the fake products on Temu are about 20 times cheaper.
In 2019, Alibaba reported removing more than 2.2 million counterfeit product listings and shutting down more than 96,000 stores selling counterfeit goods on its platform. Despite these efforts, counterfeits continue to proliferate, often due to the sheer size and number of sellers on these marketplaces.
Impact on small businesses
The emergence of these counterfeit goods is causing serious problems for small businesses in Vietnam. Unlike large corporations with strong financial and legal resources, small brands often operate with limited budgets and small staff. This makes it difficult for them to engage in lengthy and costly legal battles to protect their rights.
Monitoring and enforcing intellectual property rights in the global marketplace also requires a lot of time and effort, which small businesses cannot afford. Furthermore, the presence of counterfeit goods can seriously damage a brand’s reputation. When consumers unwittingly purchase counterfeit goods, they often receive a poor quality product, which they associate with the original brand. As a result, customer trust and loyalty are affected, causing them to avoid the brand in the future.
Poor quality goods can pose no small danger to consumers.
Poor quality goods can pose no small danger to consumers.
The financial impact of counterfeit goods on small businesses is also serious. Counterfeit products can cut into potential sales as consumers choose cheaper counterfeits over the genuine product. This loss of revenue can be devastating, especially for businesses with thin profit margins. Over time, these losses can threaten the survival of a brand.
Even as stores make efforts to remove counterfeits, the problem persists with counterfeit product listings popping up as quickly as the old products are removed.
