Khaisilk restaurant chains and real estate projects falling like dominoes

Khaisilk's 'Made in China' scandal spread to the group's other business ventures

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Khaisilk’s selling scarves imported from China as locally made products angered customers who in the past days have been boycotting every product of the Khaisilk brand.

According to the latest news, a series of luxury restaurants, namely Au Menoir de Khai, Nam Phan, Cham Charm, and Trois Pommes, have become emptier after the scandal.

Besides, a series of multimillion-dollar real estate projects in Phu My Hung urban area have faced devaluation as customers have started to complain about the quality of these real estate projects.

After the initial success in trading in silk scarves, Khai, the founder of the Khaisilk brand, decided to expand his business operations in restaurants and real estate, and at present, the revenue from real estate projects contributes a large part of the group’s total revenue.

Khai currently owns several projects in Phu My Hung urban area, including an office and shopping centre complex valued $35 million, the white castle TajamaSago valued $15 million, and the 18-storey Khai Tower.

Khai plans to construct the 20-storey Price Tower near Khai Tower, which would bring the total value of the two towers to $40 million.

Along with a loss of prestige and money, Khaisilk is facing a series of investigations following the "Made-in-China" scandal.

Notably, according to newswire Vietnamnews, on October 30, Minister of Industry and Trade Tran Tuan Anh chaired a meeting with relevant agencies on resolving violations by selling "Made in China" products under a Vietnamese trademark.

The scandal broke out after a Khaisilk scarf was found bearing both ‘Made in China’ and ‘Made in Vietnam’ tags at one of the brand’s outlets at 113 Hang Gai Street, Hoan Kiem district, Hanoi.

Anh said relevant documents had been submitted to the police that will launch a criminal probe.

In addition, a joint task force will be set up with the participation of police, customs, and tax officers, as well as representatives of the Vietnam Textile and Apparel Association and the Vietnam Standards and Consumers Association, which will launch an independent probe into allegations against the brand.

Anh also asked that the people’s committees of Hanoi and Ho Chi Minh City instruct relevant agencies to co-operate with the task force to clarify the violations of Khaisilk Group, Khai Duc JSC, and its branch on 113 Hang Gai Street.

The Department of Market Watch will collect information related to the scandal.

Onle a few days after the scandal broke out did Khaisilk chairman Hoang Khai admit in an interview with online newspaper zing.vn that half of the silk used by Khaisilk came from China, while the rest came from Vietnamese craft villages. However, he was adamant that his company always used high-quality material.

All Khaisilk outlets in Hanoi and Ho Chi Minh City have been shut down following the scandal.
Founded in the late 1990s, Khaisilk scarves are considered a premium product, popular amongst local luxury consumers and international tourists.

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