Xiaomi Fined $20,000 For Faking Sales Figures

Xiaomi has attained glorious success globally in a very short span. Whether in India or abroad the Chinese smartphone maker is creating waves for its affordable smartphone range which comes with decent specs on paper.

They say, success comes with great responsibility and looks like Xiaomi still needs to gel into the mode. Recently the tech consumer goods manufacturer has been attacked by Taiwan's Fair Trade Commission (FTC) for faking sales numbers.

Reportedly, the commission has also levied a fine of NTD 600,000 ($20,000) on the company for not being sincere enough with the number of products sold during each flash sale in Taiwan.

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Anyways, the main issue, which has been concerning the company at the moment is regarding the fine that has been slapped by the Taiwanese authorities for not being honest with the sales reports.

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As an update, Xiaomi has also released an apology poster on its Weibo official account to Taiwanese authorities for selling a grand total of 30 units less than advertised.

To break it down, last year, Xiaomi released its Redmi device in the Taiwanese market sold in three batches in separate flash sales. According to Thenextweb report, Xiaomi opened the flash sales of Redmi smartphone on December 9, 16 and 23. Where the company said that in the first two days, Xiaomi sold 10,000 units each and on the third day 8,000 units were allotted. Moreover, the company further said that the first batch got sold out within 9 minutes and 50 seconds and the second within 1 minute and 8 seconds, while the third took merely 25 seconds.

However, when Taiwan's Fair Trade Commission, investigated on the claims, it was found that Xiaomi sold only 9,339 devices in the first flash sale, 9,492 units in the second one, and 7,389 for the third.

Although, the numbers don't differ enormously, however Xiaomi's bold advertisements on "10,000 units up for grabs" was enough for the FTC to fine the company for violating a fair trade regulation in Taiwan.

Even in India, it was the same case, the company took 1,000,00 pre-registration for Mi 3 smartphone but in reality it had only sold 10,000 units. The first batch was sold out in less than 40 minutes and the second batch, which probably consisted of 10,000 units was also sold out instantly within 5 seconds.

Though, the $20,000 fine will not cause much harm to the company, which generated $5.3 billion revenue in the first half of this year.

Well, Xiaomi might have to be a little extra careful next time, especially in regards to the flash sales.

Source, Source 1