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<\/a><\/p>\nCarol He is a 32-year-old Chinese female, who has been living in America for 25 years. She is the boss of a \u201cfashion company.\u201d After deducting all costs, including wages, production cost, operation cost and all the other necessary spendings, the \u201ccompany\u201d makes about $150,000 net profit every month \u2013 and mounting. There\u2019re 12 people in her \u201ccompany\u201d now, including her. You may be wondering: how can such a small company earn so much? Well, what I haven\u2019t told you is, Carol\u2019s \u201cfashion company\u201d sells faked luxuries. From my interview with Carol, I knew that if we only consider about profitability, this is indeed a great business.<\/p>\n
Carol started selling faked goods 8 years ago. Back in 2006, she just graduated from university and found her first job in an airline company. When working there, she happened to get to know a Chinese handbag factory manager, Wang, who told Carol that his factory manufactures faked Chanel Classic Flap handbags, and that they\u2019re exactly the same as the authentic ones, but with a much lower price. Carol told her friend. Her friend bought one and said to Carol that she walked in the Chanel store with the counterfeit, and no one recognized it. Since then, more and more people asked Carol for pictures of the bags by email or cell phone. Carol then created an account on MySpace to upload photos of newly manufactured handbags. People ordered by commenting or sending messages to her. By the end of 2007, Carol was able to sell about 10 bags every week, and earned around $3,000 monthly. At that time, the price of medium Chanel Classic Flap in lambskin was $2150, and the faked one was $300.<\/p>\n
At first, Carol sold counterfeits just to make some extra money. \u201cHowever,\u201d she said, \u201csoon I had a feeling that I was the only one in this business, and people were all asking me for bags.\u201d According to her, most of her customers were Asians at the very beginning. But in the first half year in 2008, the number of people contacting her suddenly increased dramatically. In August 2008, she sold 128 Chanel Classic Flap handbags in different sizes and colors to customers all around the U.S., and her customers expanded from only Asian to Hispanic, Caucasian, Africa American, etc.<\/p>\n I asked her if she think the boost in her business has something to do with the Great Recession in 2008, she smiled and said:\u201d Well, I don\u2019t know much about economy, but thank god recessions never happened to me.\u201d Carol decided to focus on the business and quitted her job at the end of 2008. The faked Chanel sold so well that she had to quit her job to take care of the business \u2013 she even hired an assistant to help her with customer service.<\/p>\n Though the Great Recession didn\u2019t impact Carol\u2019s business directly, there was indeed a huge change \u2013 which she didn\u2019t realize till now \u2013 that was emerging in 2008. \u201cI remember it was in that year that a large number of competitors began to appear in the U.S. and China out of a sudden, to the extent that in 2009, the U.S. Customs had been very strict about import packages from China for quite a while, even non-business ones\u201d \u2013 and that was when Carol officially started her \u201ccompany.\u201d<\/p>\n Carol went back to China in August 2009, and stayed there for six months. During that time, she realized that there was much more demand for faked luxuries in China than in America. \u201cThere were so many people, they had so much money, yet they didn\u2019t know where to spend.\u201d At that time, Chinese economy was developing rapidly and led to dramatic rise in the population of millionaires. Luxury brands noticed the potential in China and were all trying to take a place in the market. Together with the emergence of various kinds of social media, such as Weibo \u2013 the Chinese Twitter \u2013 people got to know more brands. More importantly, they had the ability to make a purchase.<\/p>\n The number of luxury products is always limited \u2013 the more \u201cluxurious\u201d it is, the more limited it will be. Therefore, even if people have the money to buy a product, they\u2019re not necessarily getting it. \u201cSo I wondered, what if I can sell various brands\u2019 counterfeits that are identical as the authentic ones? Besides, the number of people who can\u2019t afford to buy luxuries but still want one is always larger than that of people who can arbitrarily buy whatever they like.\u201d Therefore, Carol met Wang again in China, and negotiated with him about expanding their production from only Chanel flap bags to all famous international boutique brands, such as Hermes, Christian Dior, Bottega Venetta, Celine, and so on. Carol buys authentic products from stores in America and sends them back to China, and Wang\u2019s factory will take care of disassembling and dissecting them, in order to make identical counterfeits.<\/p>\n Carol decided to change the way she sells as well. She still took care of the American market, but she became a supplier in China. As I\u2019ve mentioned, there\u2019re 11 people working for her directly. One of them is in Los Angeles helping Carol. Four are in charge of recruiting \u201csales associates (SAs)\u201d in China \u2013 these \u201cSAs\u201d do not work for Carol; they simply purchase from her and sell in their ways. These four people in Carol\u2019s group are responsible for communicating with SAs and making orders. Each of the four people has a staff who takes care of sending products to SAs. \u00a0Of the rest 2 people, one bookkeeper, and one who transports goods from Wang\u2019s factory to Carol\u2019s warehouses in China.<\/p>\n<\/a><\/p>\n<\/a><\/p>\n<\/a><\/p>\n<\/a><\/p>\n