In Nantai, Haicheng City, Liaoning Province, a nondescript residence may hold thousands of “luxury brand bags.”
These brand bags with logos of Coach, Dior, Burberry, etc., are not imported but have “customs declarations.” When shipped out from Nantai Town, the parcels may be marked as “shipped from Baiyun District, Guangzhou.” While they are actually produced and packaged in workshops in Nantai Town. When new products are released on the brand’s official website, they are quickly “updated” here.
The town of Nantai has a professional market for luggage known as one of the three largest luggage markets in the country. A recent unannounced visit by Surf News found that several businesses in the local market were making and selling fake designer bags.
How are counterfeit brand-name bags produced, from making plates to production and packaging to fake customs clearance procedures and anti-counterfeit chips?
The Surf News recently visited three “factories” that produce Coach, Dior, and Burberry fake bags, respectively.
It’s less than 5 minutes by car, about three to four kilometers from the Nantai bag market and boutique bag city. Nantai Town, East Yue flat, Xiangyang Street, the former Liuhe Village, and many residential areas are closed during the daytime. The street, from time to time, drove past the electric tricycle or van loaded with goods. Some of the trash heaps downstairs or at street crossings can be seen cutting off the trimmings of luggage fabrics, some of which are printed with LV, MCM, Coach, and other brand logos and patterns.
The Cui’s “factory” and warehouse are located in this area.
To reduce the risk of being “caught in a pot,” he set up the “factory” where the production was carried out. And the goods were stored in different places, which is a few streets away, within just a few minutes walk. Like other local “factories” that produce fake branded bags, Cui only imitates one brand alone. “There are too many styles to make,” he explains.
In two rooms of 20 to 30 square meters, a hydraulic machine is dedicated to cutting material. Surrounded are bundles of fabric in various colors, which are used to produce Coach bags. And you can see hardware trimmings everywhere in the basket on the floor.
In another room, two workers, one male and one female, were packing the sewn Coach fake bags with customs declarations, invoices, certificates of conformity, and other information. The floor and the edge of the bed are placed with dozens of “new bags” that have been made.
Low Cost But High Profit
Cui said, to make Coach bags, the material in 135cm width costs about twenty to thirty yuan per meter on average. As for LV, Burberry, and other brands, the material prices are mostly the same. Some expensive materials may take about 50 to 60 yuan. It depends on what materials are needed to make one and how the upstream material manufacturers set the price. As for the hardware accessories, it’s counting according to the amount, costing a few dollars per piece.
Cui said that making fake bags is the same as making small branded bags, but the profit is considerable.
He said, generally, as soon as a new style is released on official websites, someone will make a copy according to its picture. To do this model, the boss needs to buy the version from people who do this style, “a few hundred yuan, mainly depending on the precise.”
Cui said, have the version at first, then is to the fabric and hardware accessories, both mostly buy from the Guangzhou were specializing in these. After that, they use a hydraulic press to cut the material. After cutting the material, they will send the accessories and cut materials needed for a bag to the downstream “factory.” After gluing and shaping, beautifying and oiling the edges, sewing, packaging, and other steps, those shaped bags will finally return to their hands.
They are configured with boxes, customs declarations, invoices, certificates of conformity, anti-counterfeit chips, and finally, plastic seals. “The anti-counterfeiting chip is easily traced, and generally, customers rarely want it,” Cui said.
Thousands of well-packaged “Coach Bags” in Cui’s warehouse
On the first floor of another nearby residence, the reporter met Cui Jun’s family’s “warehouse.”
There were a plastic sealing machine and thousands of fake Coach bags already packaged in one house. Some of the bags with yellowed edges and slightly bulging corners were placed neatly on the floor as “faulty” bags, which Cui intended to handle separately. “We can’t let our customers be damaged.” He says there are people in Nantai who specialize in recycling problematic bags.
“I’m at risk with this, there are so many in the warehouse, and normally it can’t be more than a thousand pieces.” Cui is also worried about this, but the occasional “counterfeit wind” is like a sword hanging over his head at all times, so he chooses to take the risk.
In another room in the same area, He Wei knocked on a closed door. The person inside opened it after seeing an acquaintance and quickly closed the door after entering.
The room on the left-hand was made into a “sample room” by He Wei, mainly to display their high imitation of Dior bags. All kinds of hot style bags are placed on the wooden counter. Beside the counter, there is a fish tank with a gold dragon fish swimming inside.
High Quality for those High-Imitation Branded Bags
He Wei introduced all kinds of Dior bags sold very hotly in recently a couple of years, especially the “saddlebag.” As we speak, He Wei let his wife pick up their imitation “saddlebag” from the counter, talking about the workmanship.
“The bag mainly depends on the details of the workmanship. You can look carefully.” He Wei is very confident about the product. This authentic “saddlebag” on the official website price of ten thousand yuan, He Wei said can be shipped 100 yuan.
Next to the “model room,” an open house is the cutting room, several workers cut material in hydraulic machines. The machine is placed next to a bundle of Dior fake bags needed to do all kinds of surface (leather) material. Opposite the house is a pile of empty Dior boxes.
He Wei took the reporter to visit the “warehouse” behind this residence. The two rooms are decorated with all kinds of Dior bags sealed, rough thousands of pieces. “These are all orders placed by customers and sent out at any time.”
Downstream Factories of the Industry
He Wei said, the whole Nantai does not do much Dior goods, their home workmanship and price reputation are excellent. They are also cut material, hardware, and cut material sent to the downstream “factory. ” as Cui. “All workers are relatives, and quality is definitely guaranteed.”
He Wei said, in Nantai, such high imitation business can be divided into two types. One is those who don’t own a factory but buy from manufacturers; the other one is “factories” like them. The difference between the two mainly depends on the “update” speed. Generally speaking, every day, to update many styles, basically micro-business, “factory” does not have time to imitate.
He Wei said that micro-businesses take goods from them and then sell them at a higher price, generally holding many customer resources. Update faster, but the quality can not be guaranteed. The actual “factory direct sales,” quality, and after-sales are guaranteed. Compared to the market in the micro business, the volume price is also relatively favorable.
He Wei also has a stall in the Nantai bag market but rarely goes there. Every afternoon, he will deliver the goods by a battery tricycle to the boutique luggage market. Micro-business customers placed a single Dior order, then the micro-businesses came to their stores to place orders.
Not far from He Wei’s store in Nantai Town, a residential village in front of Liuhe, Guo Jia mainly produces imitation Burberry’s various hot bags. Guo Jia’s business range is not very large, recently looking for new customers because he just starts a while.
Like He Wei and Cui Jun, Guo Jia’s “factory” is also very ordinary, with one room as a “workshop” for cutting materials and the other one as a warehouse for packaging and molding. In the warehouse, Guo Jia recommended their latest imitation, “Burberry Horseferry Printed Cotton Canvas Backpack,” which comes in white and tan and is priced at 7,500 yuan on the official website.
“Take it away for 120 yuan.” Guo Jia showed the details of the workmanship of this bag and the customs declaration, certificate of conformity, anti-counterfeit chip, and other formalities required for authentic products configured inside. After some bargaining, the price was reduced to 100 yuan.
Guo Jia explained that due to the fight against counterfeiting recently, more than a dozen shops in the market were investigated. One who operates the “MCM” brand imitation, whose goods were pulled away by the government. They are wary of new customers, afraid of being caught. So they rarely take customers to their “factory” and warehouse.
Just next door to Guo Jia, a scrap collection yard was filled with all kinds of trimmings from cut-off boxes and bags. And a forklift kept bundling and loading the ornaments to a large truck parked on the roadside. They are also printed with LV, Coach, MCM, and other brands bag Logos and patterns on the edge of the materials.
Production Line for Making Fake Bags
Nantai town bag industry is mature, the process is perfect, by some of the counterfeiters to take advantage of.
During a visit to Nantai town, the reporter found many “workshops” with words such as folded edges, glued, embossed, stamped, pressed nails and chains, primarily located in old-style flats and ordinary homes.
The reporter contacted two Nantai town teams, who work professional nail-pressing, screwing, braiding pieces, wearing chains, embossing, stamping, etc.
Both said they could take on fake bags. One of the processors said, “there are many high imitation workshops in many places in Nantai.”
One processor told that before the high imitation bag material is sent to them, the contractor needs to find a manufacturer to make a sample. Finally, the model will be provided to them, and they can start the follow-up work such as pressing the nails, wearing the chain, and other parts.
Regarding the charges, he said that some big brand bags are decorated with rivets. They will use professional machines to nail a circle of pins, press more than 70 nails, the price in 7.5 to 8 yuan. The cost of the chain is related to the length of the chain. The ease of operation, the average chain length of a meter charge one yuan, the size of each additional 10 cm expensive, 10 cents. If the chain with thin hole, every 1-meter charges 6.7 cents because the thin one is a good thread. “If the chain is good, the price can be lower, but if it is not, the price will be 10 cents to 20 cents more expensive.”
The owner of another house directly writes on the advertising cloth written “sewing finished bags, MCM nails, Coach nails.” She told reporters that they are all hand-nailed, on the small nail price is more expensive than the large nail.
When the fake bag is formed, there is packaging before the final sale. The genuine goods have boxes, dustproof bags, customs declarations, import VAT payment certificates, and anti-counterfeit chips. Those items are also ordered and sold in Nantai Town.
At the entrance of the Nantai boutique bags, a gift box shop, there are LV, Prada, Gucci, Coach, and other brands of packaging boxes, box accessories, customs declarations, certificates of compliance, anti-counterfeit chips, and so on.
The person in charge told reporters that the boxes could be customized according to the brand style, model, and size. “LV boxes are 3.5 yuan for small ones and slightly more expensive for big ones”. In this shop, customs declarations, LV new counter boxes and pull-out boxes, Chanel certificates, and so on can be customized.
The person said that some goods, such as packaging boxes, could customize in the local area. Still, anti-counterfeiting chips, customs declarations, etc., are ordered and shipped from Guangzhou. Generally, pick up the goods on the same day or maybe a few days later. As for the price, like a set of certificates, customs sheets, invoices, some brands need 8 yuan per set and some 7 yuan. “How many customs sheets you need? Each of the above numbers can be changed at will.” He claimed.
The reporter stayed in the shop for less than 20 minutes, there have been two respectively sold Coach and LV fake bags shop owner came to take the ordered goods.
Package Box for High Imitation Bags
In another gift box shop by the main entrance of the boutique luggage market, the shop is also full of all kinds of brand packaging boxes.
The person in charge also said that all kinds of brand packaging boxes could be customized. According to the style and box size, the price varies; the average is also five or six yuan. The customs declaration is 0.45 yuan for a set, and the anti-counterfeit chip is 0.6 yuan for one. “Most of the ordinary boxes are made by themselves, a few special points of Guangzhou to do.”
They said: “generally the first day you place an order, tomorrow you can take, but now the fight against counterfeiting becomes more strict, factory shutdown from Monday to Friday, and start on the weekend.” The other side reminded that depending on the specific number and the degree of urgency, the night can also start to see if it is worth the risk.
The reporter bought Dior, Coach, LV, Burberry four brands of hot style fake bags from He Wei, Cui Jun, Guo Jia, and another merchant. In addition to the appearance of the same box with the genuine goods, the box is also equipped with customs declarations, invoices, certificates of compliance, and other objects.
It is worth noting that inside the Coach bag, the customs declaration form is stamped with the official seal of “Shenzhen Longxing Import & Export Co. “(after this referred to as “LONG XING”). The customs declaration form inside the Burberry bag is also “Long Xing Company.”
But the reporter checked the national enterprise credit information public system, did not find the company’s registration information.
Bag Recycling for those fake bags
In addition to the manufacture of fake bags, Nantai even has a local recycling business specializing in receiving counterfeit bags. Under the name of “unlimited quantity, receiving all kinds of disposal bags, sample bags, inventory bags,” they advertise themselves on poles, walls, and even on the doors of different places.
A collector for processing bags said that the bags they received are mostly “brand goods,” If the bag’s quality is no problem, the price can be increased. Still, there are generally problems such as zip yellowing, part of the glue, and so on, basically will not receive unless the price is meager.
The merchant said that a bag could only give a few dollars at most and often on the pound to collect. The reason for this is that those collected bags will subsequently be sold on Wechat moment. If there is a problem with the bag, it is not easy to be sold, “we are also going to sell mass goods, and not only sell one by one.”
The reporter noticed that the brand bag the merchant sold mostly Chanel, Gucci, LV, and other big-brand fake bags. They will send the picture of the bag and the number of inventory in the Wechat circle, less than a hundred, more than a thousand.
The company’s products are made from paper, fabric, and hardware and then cut, glued, oiled, sewn, and packaged. After assembly, some workshops in Nantai produce fake bags that are highly similar to the original.
During the interview, several owners of the fake bag business said that customers come from a wide range of sources. In addition to micro-businesses, there are also other channels of sales of goods customers. But was asked where the customers are, where to sell. Several people refused to disclose by “protect customer privacy.”
The reporter found that the express logistics point in the bag market covers Shenyang, Chengdu, Nanjing, Shanghai, Guangzhou, and other places. One parcel was shown as “shipped from Baiyun District, Guangzhou” and sent to Shawan County, Xinjiang, but was actually sent from Nantai.
An e-commerce shopkeeper operating fake Chanel, Prada, and other brands told reporters that their bags in the country mainly flow to the southern region, especially in Zhejiang and Guangdong, two areas. In addition, they are also sold to foreign countries such as Malaysia, Australia, China Taiwan, and Hong Kong. “As long as they are ordered, the platform will have a direct counterpart logistics company.” the shopkeeper said.
Why counterfeit goods sales good?
Counterfeit luxury goods, such as designer bags, are not the preserve of Nantai.
According to a report released by luxury research, China’s luxury counterfeit market size in 2019 is about RMB 400 billion, about 1.2 times that of the open market. It is expected to reach RMB 500 billion in 2020, with more than 25% growth.
Data shows that the rate of fakes in the online sales channels and other channels reaches more than 80%. The rate of fakes in the micro-business media exceeds 95%. The rate of fakes purchased on behalf of luxury brands reaches more than 80%. “Most of the luxury brand goods seen on the street are fakes, with only about 15 percent genuine.” The report points out that profits drive counterfeiters to take risks.
During the interview, several of the suppliers engaged in the counterfeit bag business in Nantai did not directly disclose the cost of counterfeiting. Still, all said that “the profit margin is large.”
Many local suppliers engaged in the manufacture and sale of counterfeits told reporters that the fight against counterfeiting is basically the market regulators from other areas. According to the goods issued to track down to Nantai, rarely see the local market regulators take the initiative to fight counterfeit.
However, during the unannounced visit, the Surfing News contacted many suppliers who behaved cautiously, saying that the locals are fighting to counterfeit.
As recently, in mid-May, a stall making fake bags in Nantai’s luggage market was busted, a scene that was captured by netizens and posted online. The video shows staff packing fake boxes and a truck piled high with goods moving from the market.
“The situation becomes strict,” A micro-businessman selling fake bags wrote in his Wechat circle on June 22.