How was Khaisilk's 'Silk Road' formed?

Referring to silk products, no one on Hang Gai street does not know about Khai Silk "empire". Originally a family embroidery shop, in the late 80s Hoang Khai, when he was a 25-year-old conservatory student, decided to stop studying to build the first Khai Silk shop.

From the very beginning, Khaisilk silk brand has been positioned by Hoang Khai as a high-class product with a methodical model, so it quickly built a reputation, especially with foreign tourists. With this position, Khai Silk's first store quickly developed, and at the same time led to the development of many other silk shops in the same neighborhood. Mr. Khai also considers himself to be the founder of the "silk street" of Hang Gai.

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Silk products in Khaisilk shop were originally made in the silk villages of Van Phuc, Ha Dong or Da Nang. However, answering Forbes in 2013, Mr. Khai also said that when the scale of the business is growing, he also imports silk from China. "The model is designed by me, I just order according to my liking," Mr. Khai said.

Silk tycoon Ha Thanh is facing a serious crisis of customer confidence.

Unlike the brands of the craft village, Khaisilk is a rare private brand positioning in the market of high-class silk products in Vietnam. Thanks to the somewhat exclusive position in this segment, the development of Khai Silk system is increasingly strong.

After the success of 113 Hang Gai store, branches and shops displaying products are continuously opened by this businessman at 5-star hotels, expensive real estate locations in big cities to promote the brand, especially with the conditional customer segment. At the same time, with this product positioning, Khaisilk brand is also sought by many domestic businesses when they need gifts for partners.

In 2002, Khai Duc Co., Ltd was established. This is the main nucleus in Khai Silk's ecosystem in charge of silk business and later a high-class restaurant system. According to Khai Duc's business registration, the enterprise currently has a charter capital of 46.5 billion VND because Mr. Hoang Khai is the largest shareholder owning 99% of the capital. Khai Duc has a system of 11 branches, of which 6 are fashion stores, including the first Khai Silk store at 113 Hang Gai, Hanoi.

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In the early 2000s, Mr. Hoang Khai decided to go south and "encroach" into the field of resorts and restaurants.

The first is the high-class restaurant Au Menoir de Khai built on Dien Bien Phu Street, District 3, Ho Chi Minh City. Next is Hoi An Riverside resort. And especially the Tajmasago white castle worth 15 million USD located on the banks of the semicircular lake in Phu My Hung urban area.

After that, Khaisilk stores and brands began to appear in the areas of Dong Khoi (HCMC), Intercontinental Peninsula Danang hotel and JW Marriott Phu Quoc.

In addition, a series of real estate projects of the owner of KhaiSilk Group include the commercial and entertainment center "Saigon Paragon" designed in European classical style with an investment capital of up to 35 million USD. opened in July 2009, or high-end restaurant chains such as Charm Charm, Nam Phan, Khai's Brothers...

Most recently, Mr. Hoang Khai opened a pho shop named Pho Ong Khai in Ho Chi Minh City. HCM. This is the first restaurant to be opened in a chain of 100 noodle shops that are expected to be opened in the southern provinces.

However, if we look at Khai Duc's financial situation in recent years, it shows a completely different picture.

By the end of 2016, Khai Duc was negative in charter capital with an accumulated loss of nearly 48 billion dong. Khai Duc's operations in the last 2 years are still profitable, but with a scale of only a few billion dong per year. This leads to the fact that all assets of this company are now financed by liabilities.

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But the heaviest blow that Mr. Hoang Khai received was in the silk segment, when on October 23, on Dang Nhu Quynh's personal Facebook page, he reflected the purchase of Khaisilk silk scarves labeled "Made in" China". According to Quynh, his family's company ordered 60 silk scarves for 644,000 VND each at Khai Silk store 113 Hang Gai (Hanoi). However, after receiving the goods, the company discovered that there was a towel in the shipment with the label "KHAISILK - Made in Vietnam" and the label "Made in China". When checking the entire shipment, the company also discovered that many of the remaining towels had signs of cutting marks at the edges of the towels.

Before the above incident, Mr. Hoang Khai - Chairman of Khaisilk Group later admitted to the media "selling 50% of silk 'made in China' in his system" and apologized to consumers.

“The biggest loss is the national brand, because Khaisilk is often chosen by many international delegations when they come to Vietnam,” said Tran Hung, deputy director of the Department of Market Management during an inspection of Khaisilk 113 stores. Hang Gai and confiscated some products worth 30 million VND yesterday.

Before the matter related to Khaisilk products, Minister of Industry and Trade Tran Tuan Anh also sent a written request to the Market Management Department to coordinate with the Department of Competition and Consumer Protection to examine, review and clarify the regulations. information regarding Khaisilk Group's sale of towels labeled "made in China".

"In case there are signs of violations related to the origin of goods, counterfeit goods, imitation goods, consumer protection, the units should immediately request the direction of handling and report to the Minister before October 28." Ministry of Industry and Trade said.

Many brand experts also believe that this incident will have a serious impact on the Khaisilk silk brand. This international "empire" will certainly be difficult to regain the trust of consumers with the brand that has been built for nearly 30 years.

Minh Son

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