(Ecns.cn)--Barely out from under the shadow of an "employee abuse" scandal, Gucci China is once again the center of controversy, this time for putting "reworked products" on the Chinese market.
The Italian fashion and leather goods label owns dozens of stores in China's first- and second-tier cities. According to one insider, Gucci gets flawed products repaired, and then puts them on the new product shelves, reports China Business Times on December 9.
"Old look deliberate"
Reporters discovered the recycling process outlined in Gucci's internal records. A customer purchased a 10,000 yuan ladies handbag and brought it back to the store when she found the handle color fading. Shop assistants took a photo of the product, then asked the customer to take the handbag home and await the company's response. One week later, a decision was reached by Gucci to recall the flawed handbag and mail it to the Italian factory for repairs. When it was returned, they resold it.
Director of Communication Huang Jianxiong denied the charges, saying, "We have noticed the media coverage of this issue and carried out our own investigation. We don't allow the sale of second hand products, either in China or elsewhere in the world. Gucci adheres to the same principle of providing high quality products and services."
Huang went so far as to say it is impossible for Gucci stores to sell second-hand products as new ones. He concedes some Gucci products are designed with an antique or stressed look, and people may mistake them for second hand.
A reporter from China Business Times visited some Gucci stores in Beijing to uncover the truth. It was found the 'antiquated' leather goods showed no gloss even in strong light. It was hard to tell whether the inspected products were second hand or not based on their appearance.
Maintenance outsourcing
Then Gucci was hit with more bad news. An insider disclosed Gucci often takes goods returned for repairs to small and obscure street stalls to get the work done, while the consumers are informed the product has been sent to Shanghai or Italy for maintenance and that the process will take several months. They keep the repaired item for a time at the store, returning it to the customer later, as if it had been sent to the factory.
Gucci employees in the customer service department denied this, and said all products in mainland China that need repairing are sent to Shanghai, the headquarters of Gucci China.
But the employee's words contradict Huang Jianxiong's clarification. Huang admits not all damaged products are sent to the Shanghai maintenance center, but insists, "Nonetheless, we do send a photo of each flawed product to the Shanghai Maintenance Center, and a serviceman decides whether to have it repaired locally or in Shanghai."
During an onsite investigation, the reporter was guided to local repair and maintenance shops to make some queries about after-sales service contracts.
Huang Jianxiong's position is that Gucci China has established a sound after-sale maintenance mechanism, and Gucci head office determines what outsource factory is used. Huang refused to show the reporter any related documents as proof.
If Gucci is guilty of keeping the truth about maintenance outsourcing from consumers, there are legal ramifications according to one professional source: "If a seller promises to send a product that needs repairing to the original factory or to some appointed and named third parties in China, that seller is bound to its promise, and directing maintenance or repair work to other places is an act that can therefore be categorized as cheating the consumer."
Absence of after-sales service
It is common today for popular brands to have specialized maintenance sites situated across China. But in the high-end luxury brand spectrum, after-sales service often lacks the necessary parts.
The reporter paid a visit to a watch workshop focused on Swiss brands. The shop assistant says watches that come here for repair are usually over tens of thousands yuan in value. If the problem is not severe, the watch is fixed immediately on site; otherwise they order parts from the factory and fix it when those parts arrive. So it is natural for maintenance fees to cover parts, logistics and all sorts of service charges.
"The workshops are unauthorized by brands. If they presumed to charge a fee higher than the industry standard, consumers wouldn't know." complains Mr. Lei, who was confused about having spent so much money and not getting good service in return.
There is supervision and administration of product by the government suitable for domestic and international brands. The law says misleading consumers by using bait and switch campaigns or false advertising comes with penalties that range from fining the company to terminating its business.
Some experts suggest Chinese fans of international luxury brands need to unite to safeguard their consumer rights and make an open call for the establishment of specialized maintenance sources.
