There goes an old Chinese quip, ‘cheap things are not good, good things are not cheap’. It seems that this remark is more for the rest of the world than for China itself. I wonder if it would be cynical to say that China’s economy thrives on off-brand product sale.
Take the case of Goldman Sachs, or what seems to be a pirated version of it. Listed as Goldman Sachs (Shenzhen) Financial Leasing Co. and daringly operating in the city just across the border from Hong Kong, it claims to be one of the city’s largest financial leasing firms. Shenzhen’s Goldman Sachs came to light through a letter sent by a U.S. casino workers’ union to Chinese officials that were aiming for a big anti-corruption crackdown.
Another passive-aggressive affiliation of China has been with the premium Apple brand. With the gleaming iPads and iPhones, crisp marketing graphics and associates in blue shirts ready for assistance, one would hardly lay a suspicious eye on its authenticity. However a detailed probe revealed that though the Apple products were real, the store itself was completely fake.
What’s more? Ever heard of IKEA? The Swedish furniture behemoth that goes by the name 11Furniture in China. The store copies not only IKEA’s products but also its blue and yellow colour scheme. The cozy-looking space is resplendent with replicas of IKEA’s signature furniture.
The knock-offs identified above are brands, brands that command market share in their respective fields. China’s fraudulence is rooted in its people. It was reported that a soft drink vendor in Hubei province of China came up with a brilliant scheme to defraud the government- he faked his own death! It was a whole shenanigan, he got his friends to parade his sheet covered corpse around town, claiming that the urban management workers had beaten him to death, thereby asking for a compensation of tens of thousands of dollars. Fortunately for the authorities, but unfortunately for the vendor, the day was too hot to actually die. During the rally, the “dead” man jumped up and grabbed a drink after he couldn’t bear the heat anymore. You’d think that this is where it stops.
Morally speaking, in the Chinese culture, copying has never been either fraudulent or seen as a lack of talent. In fact, the way to learn for a long time has been repetition, the exact reproduction of one’s master’s work and teachings.
This is also reflected in the Chinese cognizance of business, where knowing and reproducing the steps of successful ones is wonted. Translate this thought as – if I can copy the best, it means I’m as good as him. For China of today this has become – if I can do the bags as Prada, it means that I am as good as Prada, and if I am as good as Prada, I’m Prada.
The reason why this ‘fakery’ not only exists but thrives and mushrooms is due to loose copyright laws. In the West, inventors and designers have been protected by patents for hundreds of years. But in China, which is still emerging from the shackles of Communism, the notion of intellectual property is still a relative novelty.
Would you consider China a step behind or a step ahead from the brands of the West? In retrospect, China is not innovating new ideas, it’s simply offering something that is already established-the comfort of a name. It is using a company’s most valuable asset – its brand – and fishing in its pool of customers. I leave you with this thought – is this smart or frowned upon?
MA (P) Economics
Delhi School of Economics