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November 22, 2018

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Price-switching scandal boss gets a lot of stick and very little carrot

The general manager of Hema Fresh Shanghai was sacked yesterday after an employee was caught replacing old labels on food with new ones showing a later date.

In an open letter posted on Weibo, Hou Yi, CEO of Hema Fresh, apologized to customers and said that all outlets had been told to improve their working practices or suffer the consequences.

He also said the company would set up a customer panel to keep tabs on stores.

The retailer said label switching was absolutely prohibited and that the upper management was completely unaware of the practice.

Wang Zheng, deputy director of Jing’an District market watchdog, said yesterday that Hema would be punished if any fraud was proven.

Profits may be seized and a fine of up to five times any illegal profits can be imposed. If the illegal profits cannot be calculated, the fine can be as much as 100,000 (US$14,440). In serious cases, businesses can be closed.

Customers are entitled to 500 yuan or three times the price of the products involved, whichever is greater.

City food safety law covers label switching, but a carrot is an agricultural product and the concept of a production or expiry date has no meaning, said Wang.

The date on the package was probably a packing date or date the product went on the shelf, neither of which are covered by the food safety law, he said.

The incident came to light after a shopper named Fang told Shanghai TV that he saw an employee at the Daning store ripping labels off carrots with production dates of November 9, 10 and 11, and sticking on new ones dated November 15.

“I was shocked when I picked the tag from the garbage and saw the dates,” said Fang, who spoke to workers at the outlet immediately.

The company offered Fang a 1,000 yuan cash incentive to keep his mouth shut, which he turned down and duly informed Jing’an police.

Hema Fresh said it was “ashamed” of the incident.

The employee concerned was initially fired, but has since been reemployed as the label switching had been a managerial decision.

The incident has not gone unnoticed by costumers.

“I visited a Hema outlet close to my home very frequently because I thought the food was fresh and of good quality,” said Anna Chen in Xuhui District. “It is very disappointing, particularly because the prices of Hema’s vegetables are much higher than other supermarkets.”

“I often buy food there for my daughter and may turn to other supermarkets after this incident,” said Du Bing, another customer.

Last year, the Luhua outlet of Shanghai Chongming Hualian Supermarket was fined 10,000 yuan by Chongming market watchdog for extending expiry dates on frozen fish by almost six months.




 

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