A "white paper" on AliBaba

[Randy W]

An interesting look at wheelings and dealings within China - from the Wall Street Journal. AliBaba, of course, is the parent company of Taobao, China's premiere online marketplace.

 

A Closer Look At China’s Alibaba Allegations

 

The State Administration of Industry and Commerce’s white paper marks an unusually direct criticism of Alibaba Group Holding , an Internet giant that’s normally seen as a darling of Chinese commerce. The report paints a stark and colorful picture of a whole host of alleged offenses and misdeeds of Alibaba’s managers and the merchants who use its online trading platforms.

Faced with illegal business activity on its platforms, the paper says, Alibaba Group “long did not pay sufficient attention to the issue and did not adopt effective measures.” Citing a Chinese phrase that refers to letting a small problem fester, it said this “caused a neglected carbuncle to become the bane of its life.” The report said the problems have become Alibaba’s “greatest credibility crisis” since the company was established.

Alibaba on Wednesday said it takes responsibility for sales of counterfeit items on its website and its effort “is far from complete.” But it also criticized the SAIC’s findings, saying it reached “a biased conclusion using the wrong methodology.” It also said it plans to file a formal complaint with the SAIC.

Among the paper’s highlights:

• PROBLEMATIC PRODUCTS: . . .
• BULLYING: . . ..
• BRIBERY: . . ..
• FAKE TRANSACTIONS: . . ..

 

 

[jwdoetsch]

This doesn't come as a surprise to anyone who has done business with Alibaba. My wife and I have a few different wholesale/retail stores that we operate on one of their web platforms and fake transactions, crap products, customer payoffs, review and ratings padding and more are all seen as normal. This goes on in almost all Chinese businesses, actually. And since it's so endemic, every business owner or trader is forced to participate in order to compete.

 

edit: It's not surprising that these allegations are coming to light now that Alibaba is now publicly traded in the US. It's the face of Chinese business for many western traders, it makes sense that China would want the company to employ fair business practices. I don't think these allegations would have been made had not gone public.

Edited January 29, 2015 by jwdoetsch (see edit history)

[Doug]

This doesn't come as a surprise to anyone who has done business with Alibaba. My wife and I have a few different wholesale/retail stores that we operate on one of their web platforms and fake transactions, crap products, customer payoffs, review and ratings padding and more are all seen as normal. This goes on in almost all Chinese businesses, actually. And since it's so endemic, every business owner or trader is forced to participate in order to compete.

 

edit: It's not surprising that these allegations are coming to light now that Alibaba is now publicly traded in the US. It's the face of Chinese business for many western traders, it makes sense that China would want the company to employ fair business practices. I don't think these allegations would have been made had not gone public.

I agree, what we call corruption is everywhere in China, and in the most unlikely places. But then think about that movie Rodney Dangerfield was in where he had some clothing store in Chicago was it??? He implied the same thing right cheer in the good ol USA. Folks in the USA gotta just consider, it is normal life in China.

Some day I will have to detail what goes on in sports.

 

PS: We pay our rep in China a rather high commission, compared to all others, to get our parts designed in and sold. We don't ask questions.

Edited January 29, 2015 by Doug (see edit history)

[Randy W]

Alibaba responds

 

On Carbuncles, Battalions and Crows: Choice Words in Alibaba’s Fakes Fight With Beijing

 

“Taobao is destined to bear this injustice, this responsibility. Taobao has to accept it, and solve it.”

 

“To solve the problems of counterfeits and intellectual property is to solve the problems of Taobao’s existence. [solving] social problems cannot rely on one single company or one single platform. We must use all manners of recourse and all our power, and do it through social co-governance rather than act independently and make accusations at each other. “

 

. . .

 

The agency “succeeded in proving just how unsafe and unreliable online shopping in China is, just how crafty the several millions of online retailers are, just how blind and stupid its 500 million consumers are, and how Chinese manufacturing is blacker than the crows in the sky.”

 

“We can accept your god-like existence, but what we don’t understand is how there can be different standards and a god-like logic in your numerous samples and reports.”

 

“I believe no one else will be able to stand up and tell you how wrong and ridiculous you are, how absurd the things you’ve done have been, and how deeply you’ve damaged the overall credibility of the several tens of thousands of law-enforcing colleagues of yours in the SAIC.”

 

“Dear Director Liu, there’s a saying online: ‘if you’re unhappy, buy a bag.’ For you, it’s ‘if you’re unhappy, attack Taobao.’ ‘If you’re happy, also attack Taobao.’”