Jack Ma: Chinese Knockoffs are Actually Better Than the Real Thing

June 14, 2016

A Chinese billionaire whose company is notorious for selling counterfeit goods says fake products are better than the real ones.

Alibaba, founded by entrepreneur Jack Ma, is China’s largest e-commerce platform and has a notorious reputation for regularly featuring counterfeit goods.

During a company event on Tuesday, Ma addressed his investors at Alibaba’s headquarters in Hangzhou and stated that Chinese-manufactured knock-offs are just as good, if not better, than the real deal. According to CNN Money, Ma said:

“The problem is that the fake products today — they make better quality, better prices than the real product. The exact factories, the exact raw materials, so they don’t use the name.”

The Chinese factories that top global brands have used for years to manufacture products such as designer purses have mastered the skills to do so, Ma elaborated. As a result, they can easily make their own imitation products with variations here and there. Thanks to the marketing power of the internet, Chinese manufacturers don’t need to rely on international brand names to generate profit.

Even so, Alibaba is still working to eliminate counterfeit items on its site, but it has been a challenge. In May, the company was suspended from the International AntiCounterfeiting Coalition. The global watchdog suspended Alibaba after a handful of top brands dropped out and protested.

There have been rumored reports of possible conflicts of interests between Alibaba and the non profit’s president. Ma said to his investors:

“We have to protect [intellectual property], we have to do everything to stop the fake products, but OEMs are making better products at a better price.”

Alibaba has faced lawsuits in the past from companies such as the Paris-based Kering that represent famous luxury brands including Gucci and Yves Saint Laurent. The lawsuit claims that Alibaba encouraged and profited from the sale of knock-offs on its site.

Ma defended Alibaba by pointing out its financial importance to China’s economy. Investigations that halt the e-commerce site will have drastic consequences to the economy. He said:

“You can’t stop Alibaba for two hours otherwise it’s going to be a disaster for China. You can stop Tencent for two days, you can stop Baidu for two weeks and everything will still be OK.”

Ma, 51, has a reported net worth of $23 billion. The self-made entrepreneur founded his online shopping platform in 1999 and has since hosted millions of merchants and businesses on their site.

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