Dahua Admits Failed Channel Strategy

By John Honovich, Published May 26, 2015, 12:00am EDT

One of the biggest challenges for expanding Chinese vendors is mastering sales, marketing and distribution to Western markets.

Dahua has failed here.

Instead of solving it, mega-manufacturer Dahua is whining and declaring punchless threats. In this note, we break down the problem, Dahua's attempted solution and how this impacts the expansion of low-cost products into the Western surveillance market.

Dahua's Channel Challenge

In many Western countries, most notably the large US market, Dahua has no official direct channel. If one wants to buy Dahua branded products, they are essentially forced to buy through unauthorized channels.

The other alternatives is to buy through Dahua OEMs but almost all of Dahua's OEMs hate to admit OEMing Dahua and, contractually, Dahua is not allowed to tell people who OEMs Dahua products, creating a bizarre situation.

The result is an explosion of online stores where Dahua products can be bought. The most notable is Aliexpress with over 11,000 Dahua listings, next would be Amazon with over 2,000 listings. Beyond that, there are dozens, maybe hundreds of other unauthorized stores selling Dahua online.

Dahua Strikes Back

Dahua 'solemnly declares [link no longer available]' that they are not going to take it anymore. They vaguely mention legal action and try to spook buyers by saying the products sold online might be 'counterfeit and shoddy'.

Dahua includes a long list of some but not all unauthorized sellers, copied verbatim below:

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     • www.dahuawhosales.com [link no longer available] 
     •Security product supermarket (http://www.cctv-mall.com/)
     •Amazon (http://www.amazon.com)
     •eBay (http://www.ebay.com)
     •Aliexpress (http://www.aliexpress.com)
     •Alibaba (http://www.1688.com/)
     •Shenzhen YCX Electronics Co., Ltd (http://www.ycxcctv.com)
     •Hangzhou Quan'an Technology Co., Ltd (http://www.hzqakj.com [link no longer available])
     •BONDWELL (http://www.bondwellcctv.net)
     •Zysecurity (http://www.zysecurity.com/)
     •Shenzhen Dayi Technology Co., Ltd (http://www.dayitech.cn/en-us/home.aspx [link no longer available])
     •Networkcamera wholesale (http://www.networkcamerawholesale.com/)
     •Bulwark Tech Ltd (www.dahuawholesale.com)
     •SINTRA BALTIC (www.sintrabaltic.eu)
     •Sunivision Technology Development Co., Ltd (www.sunivision.com)
     •Dahua Security (http://dahuasecurity.co.nz/)
     •HUABEN TECHNOLOGY LIMITED (www.huabencctv.com [link no longer available])
     •Yahoo (http://hsrd.yahoo.com/)
     •PROVIDEO CO., LTD (www.provideo.com.tw)
     •Wei-Yah Technology Co., Ltd

Flaws in Dahua's Threat

First of all, Dahua offers NO names of legitimate / authorized resellers. All Dahua says is "Dahua sells its products through its authorized distributors. If you would like to verify whether the sellers are Dahua’s authorized distributors, you can contact us at overseas@dahuatech.com."

One has to email Dahua with names and see what they respond, if they respond. Last year, we asked Dahua for the list of legitimate resellers and they could not provide it, showing how bad their channel model is.

Secondly, Dahua is not even able to shut down companies who have basically stolen their website, e.g., Dahua New Zealand. If they cannot stop something that wrong, how are they going to do anything against the regular online resellers?

A Challenge for Dahua and Hikvision

Both of the mega Chinese manufacturers have notable issues with unauthorized resellers. For example, many Westerners try to buy Chinese versions of Hikvision only to save even more.

However, Hikvision actually sells its own branded products in the West and has a clear list of who is actually authorized (see the current US Hikvision authorized dealer list). By making it easier to get their products legitimately, manufacturers can simplify such problems.

A Good Problem for Dahua

Despite Dahua's weak attempts at responding to this, this is overall a good problem because it shows people want their products. The main issue is that Dahua is failing at delivering it to buyers in the means they want. 

There is an obvious solution - simply mirror what Hikvision has already done in the West - and Dahua seems to be trying to do it with their Massive American Planned Expansion. In the meantime, the solemn declarations without any tangible action will have no material impact.

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