Fake Brands up on Council’s Radar

02/07/2012 17:18

Counterfeit brands of consumer durable goods remain a ‘big’ business in the hire purchase market in Fiji.  And, the poor and the middle-class consumers are the ones most brutally hit by these fake brands.

These were the two key findings in the duo “Hire Purchase Industry in Fiji” reports launched by the Consumer Council of Fiji last week.

The concocted brands seem so real that consumers, most of who do not have the know-how or knowledge to detect the fine difference between the “real and the fake” items end up buying them.

The Council strongly believes that the consumers are being betrayed because they are investing in a product which is not real and this is a reality unknown to them. It is not a genuine article and it cannot be expected to function as a real product would. The manufacturing of such products is questionable – right from the point of its origin to how long it will survive. Is it even safe?

This is evident in the number of complaints we receive regarding leaking fridges, malfunctioning TV sets , gas cookers, woks  and toasters and  washing machines giving electrical shocks -  we have seen cases where consumers have purchased electrical items  on credit and it lasts for only a week.  Where is the justice in this?

The reports  highlight that many consumer durable products sold in the HP market  in Fiji are either unknown ‘brands’ or generic brands or clones, or concocted brands (defined here as ‘brands without factories’). Over the past 15 years, especially with the rise of mass production of consumer durable industries in China and some Asian countries, the proportion of such brands has increased markedly. The standard practice is for a retailer and/or distributor on behalf of a retailer to register “brand” names in a country, and purchase generic products made by production companies with the brand names supplied.

One such famous brand is Akita. A number of consumer goods are imported by the HP companies under Akita branding but there is no ‘Akita’ factory anywhere in the world. A Google search on ‘Akita’ does not produce any return for the first 50 pages of listing.  Other similar brands sold are Infinity, Simmons, Nakita, Pelasonic and Maxton.

Most of these products do not have manufacturer’s warranty that a consumer can be provided with. For this reason and to prevent scrutiny on product standards and certifications, the retailer itself provides warranties to consumers. This is in breach of a consumer’s right because every durable product must come with a manufacturer’s warranty that guarantees the products’ merchantable quality.

Sadly, the poor and vulnerable consumers become the common targets given the fact that they don’t have cash to buy the product. It is the lower stand of the society – the ones living a little above the poverty line and the middle class who are the worst hit as they are left with no or little choice but to buy these brands.  What is more heart-breaking is that  they buy these  products on credit which  means they pay monthly installment and they end up paying 1.73 times more for the goods as they would have paid if they could afford to buy cash.

The reports highlight that these consumers get attracted to enticing advertisements in the media not knowing that they are purchasing a fake product that has no proper origin.

Instead of rejecting such products, our HP retailers are promoting and capitalizing from these unknown brands with false claims.

HP companies mislead consumers with false claims that “most” of its products come with “acclaimed quality standard and are certified”, and that the “products that are financed undergo quality checks from respective regulatory authorities from the country of origin before they are allowed to be sold in Fiji. Every effort is made to comply with these requirements”.

Marketing of such fake brands in Fiji raises a number of issues on quality and standards.  The Council will not condone this and calls on the appropriate authorities to seriously look into this issue and restrain the credit providers from such unethical practices.