For many foreign SMEs that produce consumer goods e-commerce is the best way in to the Chinese market, offering a B2C channel that is relatively cheap and easy to setup and maintain. Naturally, trading on the web comes with risks, but just a few key steps are necessary to ensure a basic safe strategy. In this ‘SME in the Spotlight’ post an anti-pollution mask producer shares their experiences of doing business in China….
Vogmask is a popular anti-pollution mask product available in China, using an innovative microfiber filtration fabric. Christopher Dobbing founded Vogmask China in 2013. Originally an education consultant, he found that most students he worked with mentioned air pollution as major challenge for China in the next 10 years, and that many of them had breathing illnesses or carried an inhaler with them. While searching for a good quality mask that he could recommend to students, Christopher got in touch with Vogmask USA. Vogmask UK and Vogmask China were founded shortly after.
“Vogmask China was founded in 2013 and our business has grown rapidly since”, say Christopher. “The market for air pollution products is growing, and until we entered the market no good pollution masks for children were available in China”, he continues. “Our masks are available at hospitals, international schools and online. Because the design of our masks is adaptable we can be creative in branding. Vogmask is a combination of fashion and function.”
Not long after its market entry, Vogmask found counterfeits and unlicensed products on the Chinese online retail platform Taobao. Christopher explains: “We monitor the market carefully and conduct a weekly online check. There are two types of items we need to deal with online: the first is cheap copies of our masks, the second is unlicensed imports of real products, meaning that the seller imported the goods illegally in order to avoid paying 17% inport tax.” Christopher indicates that the volume of infringing products is growing every week.
Through the EU SME Centre, Christopher got in touch with the Helpdesk, who provided information on how infringing goods can be taken down from e-commerce sites in China. “This has been very useful and we have a clear idea on how to act now”, Christopher says. “We registered our trade mark in China immediately when we entered the market, but as registration processes in China can take quite some time, we are still awaiting our trade mark registration certificate. We need this certificate to prove to Taobao that we own the brand, and only then can we start with the takedown procedure of infringing products”.
Other than the continuous battle with online infringers, Christopher has an adequate IP strategy in place. He states: “The filters used in our masks are made of a very specialized, patented material. As it is too advanced to be copied cheaply, the quality of infringing products is not nearly as good as the original. As people are aware of the health issues regarding air pollution, they won’t buy a cheap copy instead of the real product.” According to Christopher, the design of the masks changes frequently, so copycats can’t keep up with the changes: “The design of our masks changes every year, people want to keep up with new trends and would therefore not buy a copy of last year’s design.”
Furthermore, Christopher says that although Vogmasks are manufactured in Korea, the company works with a distributor in Singapore so there is always the chance of information being leaked to China. “We monitor our distributors and had to cut one off because they seemed to be leaking information. Other than that we’re good, but it’s important to stay ahead.”
As a recommendation to other SMEs operating in China, Christopher advises: “Monitor the market, keep track of the business environment and deal with challenges as they arise. Start the process of registering your trade mark as soon as possible, because the registration process in China is very time consuming. Things that take one hour in the UK can take six months in China, so you really need to assign time for all registrations in order to manage your business well.”
Curious about Vogmask’s anti-pollution masks? Learn more by visiting the company’s website.
For more information about managing online infringement, read the Helpdesk’s publications “Protection of online IPR in China” and “How to remove counterfeit goods from e-commerce sites in China”.