Mumuso Vietnam, a retailer with 27 retail outlets in Hanoi and Ho Chi Minh City has been accused by South Korean news broadcaster SBS of falsely selling Chinese goods to Vietnamese consumers as products from South Korea and that the company is actually based in Shanghai and has no real relationship with South Korea.
In order to address these allegations, representatives of Mumuso Vietnam held a press conference in HCMC on May 11th and stated that the company registered its brand under the protection of Korean Intellectual Property Office, and has a branch in Shanghai, China.
At the press conference, Mumuso Vietnam representatives stated that the Shanghai “branch” has been designated as the company’s “headquarters” and that Mumuso has authorized the Chinese-based entity to take over its business activities, including brand management and production technology.
Mumuso, which is run stores in different countries including Vietnam, is accused of duping customers into thinking it is a South Korean brand that specializes in selling South Korean-made products. Mumuso is present in Vietnam under a franchise contract with the Shanghai-based company.
In response to the statements by Mumuso, the Korean Intellectual Property Office has asserted that while the Mumuso “brand” is registered in South Korea, the company does not engage in any production activities or have any presence in the country. SBS News also said that it could not find the Mumuso office in South Korea.
In response to the statement by the Korean Intellectual Property Office, Mumuso Vietnam’s representatives said the company’s office in South Korea was relocated in August 2017 due to “a number of objective reasons” and that “SBS News [reporters] just came to the old address, so they could not find our company.”
Nham Phi Khanh, Mumuso Vietnam’s director, admitted that the company has yet to have any outlet in its ‘home’ country, and said that this is a deliberate business strategy because Mumuso wants to strengthen its brand overseas before “returning home”, where competition is fierce. However, news reporters noted that it’s impossible for Mumuso to “return home” to South Korea when the come was never there in the first place.
Khanh also admitted that Mumuso has no production activities in South Korea and that none of its merchandise has ever undergone quality inspections in South Korea. According to Khanh, the products are imported directly from China to Mumuso stores around the world.
Khanh stressed that this does not mean the company’s products are of poor quality. “Our products meet standards and regulations set by the Drug Administration of Vietnam and the Department for Food Safety and Hygiene under the Ministry of Health.” He also said he did not believe that customers have been cheated, since the products all come with “Made in China” tags.
Nevertheless, many local Vietnamese customers said they believe they have been misled by the brand’s trademark, which reads Mumuso.kr, and that the products have Korean labels, which make them believe that all Mumuso products are from South Korea with quality up to the country’s high standards.
Mumuso Vietnam said that it plans to expand its operations in Vietnam from 27 outlets to 80 but with many Vietnamese consumers shunning products that are made in China, and with increase press and government scrutiny it remains to be seen whether the company will be able to execute its expansion plans.
A prominent Vietnamese lawyer noted that while Vietnam does have the ability to create “class-action lawsuits” that could enable consumers to address the company’s “fraud” by legal remedies its exceptionally difficult to get decisions in a timely manner. The lawyer said that Vietnamese consumers will be expected to keep up criticism of the company through social media channels and that getting government approval for future retail stores will be more difficult now that the company has been exposed in the media.
Other so called “Korean” branded retail outlets including Miniso and Minigood appear to be in the same situation and are undergoing intense scrutiny by consumers. At Minigood, many signs in the store tout products as being “Korean Designer Brands” items. The boxes of some products say they are “Designed by Korea” but there is no proof of the claim and all product boxes say “Made in China”.