#StartupsVsCovid19: Club Factory Supports India Demand For Medical Gear With Imports

As the pandemic impacts businesses of several small retailers, Chinese ecommerce company Club Factory has now offered to help them in importing medical gear from China. The company is reportedly helping to import essential goods such as masks, hand sanitisers and other protective medical gear.

Called Project Ginger, the company is communicating with sellers offering to facilitate the purchase, custom clearance, warehousing and shipment to end consumers. The company spokesperson reportedly said, “Club Factory is committed to rendering all possible assistance to the Indian government in dealing with the Covid-19 pandemic, including the supply of protective equipment.” The spokesperson added that the procurement of goods will be done “in compliance with applicable laws”.

However, the company’s pitch to sellers is to help them make financial gains amid lockdown. Club Factory is looking for partners with experience and capabilities in cross-border commerce. The company has clarified that sellers will be allowed to sell these products both offline and online.

Club Factory made its entry into the Indian market in 2016 and ever since then the company has been surrounded by a wide range of controversies. Whether it’s about selling counterfeit products or “Schedule H drugs” without prescription, Club Factory has been accused of it all.

However, the biggest controversy Club Factory has been involved in is undoubtedly the tax evasion claims the Indian customs department imposed on the Chinese ecommerce company. As per the customs department, Club Factory, along with another Chinese ecommerce platform Shein, used to mark their orders as “gifts” to avoid any custom duties.

In September 2019, Delhi’s customs department had also confiscated such products from Club Factory’s warehouse. Besides that, the Indian government decided to do away with the provision to not impose customs duty on items marked as gifts, in November 2019.

The company believes that its strength lies in its highly cost-efficient products, payment gateway and logistics. Club Factory founder and CEO Vincent Lou told Inc42 that the company has achieved more than 10 times growth in the past six months. Overall, the company registered a 4x increase in orders, compared to the orders received in 2018.