I read your post with interest, and it sounds like you were very disappointed. I’m really sorry to hear that you had that experience.
I had a couple of random thoughts and comments based on what other people have been saying, and in response to your post.
I think of Chi-Fi as referring to Chinese-based companies that manufacture components that are sometimes much less expensive than those manufactured in Europe or North America (and sometimes of dubious quality). I do not think of companies that are based in other countries, but which manufacture components or the entire product in China, to high or exacting standards, as "Chi Fi". Examples of such companies could include Audioquest or Mark Levinson, but there are many more.
Laiv products are manufactured in China but the company is not a “Chinese company” – it is based in Singapore. I do think that their products are of a very high manufacturing quality.
Some folks have mentioned Alvin Chee, asking him to speak up, but it is worth pointing out that the OP did not appear to order through Vinshine Audio, Mr. Chee’s company, which is also located in Singapore. The OP bought the components directly from Laiv online, it appears.
Your own (OP) description of their return policy includes everything for which you were charged including, in bold font, the “additional deduction of 4.5% of the order amount”. That cost is not at all hidden, indeed, it was emphasized. Given your plan to audition the DAC, and to have an opportunity to return it, I would have thought that you would have paid even more attention to that particular detail. But it is in no way a “hidden” fee.
I bought my own Laiv DAC intending to keep it. However, if disappointed, I imagined that I would be able to resell it online, probably at 70% or more of the new cost, if I didn’t like it. I also knew that 70% would be of the retail price and not the real cost to me after shipping, card fees, import duties, etc. As a "hot" (or hyped) item, I figured it would sell easily if I wanted.
I think that your assumption about them creating a business model to profit off of disappointed people who return items for a “refund” (wherein they make money from doing that) is completely incorrect. First, they will lose money due to the lack of a market for used items (although their website refers to “industry discounts, B-stock products, or other special arrangements” for items that one is not permitted to return – so there must be some way to purchase returned stock items for a discount). I do not know their numbers of DACs sold globally, but I could only find 50+ used Laiv Harmony DACs sold through HiFiShark, in total (and they appear to sell very fast). Moreover, some of those are not sold, but are marked as “off”.
So, these DAC's are hardly being "dumped on the secondary market". The return that you got was over 88% of the new price and that is better than the few sales I could see documented online.
You said “So, it dawns on me that this company is really planning on a lot of returns. This is part of their Business Plan!” Now I really hate this company and vow to never do business with them again. Yup, they have made me an Enemy for Life by sneakingly hiding their total restock fee.” You then claim that posting your negative impressions serve to all of us as a “Public Service Announcement”.
I feel bad that you had this experience. Like other posters here, I think it might have been better for you if you had burned it in, as Laiv recommended to me in an email, for 1-200 hours (I turned mine on and left it going for a week straight before serious listening). It might have felt like less of a mediocre product if you had done that, but the characterization of this company as one that you now “really hate”, because they charged you fees that were not in the least hidden, stands at odds with the experiences of the very many folks here who have had unfailingly professional, polite, cordial and helpful interactions with the company. I hope that those who are thanking you for the heads-up also read the responses by those of us who have actually purchased from them, posted in response to you.
Tim