The act of counterfeiting not only harms consumers but also imparts a massive blow to the economy of any country. The fight against anti-counterfeiting needs awareness and the use of advanced technologies to spot the fakes.
Many brands are experiencing tremendous losses due to counterfeiting in the form of lost revenue, consumer dissatisfaction, irreparable damages to the brand reputation, and so on. As per the Global Brand Counterfeiting Report, 2018, counterfeiting globally would reach more than USD 1.82 trillion.
Counterfeiting has a direct effect on government expenses and tax revenues. It has an adverse impact on employment too, which is experienced by the retailers, suppliers, and supply chain.
The World Trademark Review talked to a panel of industry experts representing different countries – China, USA, Ukraine, and Russia – to discuss how business owners can fight illicit trading of goods.
They made a few very interesting revelations that covered IP rights and IP enforcement strategy, registering relevant marks with customs, reliable monitoring/tracking systems, and tools, such as QR Codes, and acting on intelligence.
Counterfeiting affects everyone. Fake products are manufactured in unregulated conditions, using low-quality materials, and do not go through mandatory quality checks. Many counterfeit products such as medicines, electrical and electronic accessories, toys, food items, car parts, pose a serious threat to the consumers’ well-being. The following are the significant effects of counterfeiting.
Counterfeiting supports the black market
Counterfeiting is no more a petty crime of producing and selling cheap fakes but has become a part of organized crime.
The trading of pirated and fake goods not only makes companies lose their brand image and force them to incur losses but also provide money for organized crime. This is where no group works in isolation.
It is an organized platform where the successful groups get the support of others. It helps them to conduct illegal activities underneath. The criminal world is interconnected and gets immense support from each of the elements.
In the following Ted Talk, Alastair Gray talks about how counterfeiting supports organized crime.
Most countries run on taxpayer’s money. When counterfeited goods reach the market, there is no tax generation. The money can be laundered underneath, and the government does not get any percentage from the transactions. A considerable amount is lost that can be used for different measures.
It is found that USD 70-89 billion is lost every year globally due to counterfeiting. The money lost could have been used for education, healthcare, and innovations.
Counterfeiting discourages innovation
Counterfeiting also results in hindering innovations in various industries. When the customers are getting a similar product at an unbelievably low price, they don’t mind buying the fakes. The sale of counterfeit products hampers the sale of genuine products and, in turn, discourages innovators.
Counterfeiting harms the environment
Counterfeiting harms the environment. Counterfeit products manufacturers do not obey the regulations. They illegally dispose of harmful chemicals and release toxic gases and cause harm to the environment. Also, counterfeiters use low-quality raw materials, so the products are not as longlasting as the original ones and are not usable just in few days. These fakes end up in the garbage, increasing pollution.
Many fake products such as medicines, consumer electronics, toys, automotive parts, baby safety products, put their users in severe health and safety danger. Many lives are lost and many are put in fatal danger due to fake drugs consumption.
How to fight against counterfeiting?
Registration of the trademarks in the domestic and international markets where products are manufactured and sold should be done immediately. There will be a way to stop counterfeiting items being exported that includes registered trademarks.
Regular policing of the products by the retailers, wholesalers, and the manufacturers themselves will also raise awareness. In fact, the government of the said country, where the products are sold, must have an institution to take care of such things.
Spreading awareness about the counterfeits will also be very helpful in preventing the fakes. If the customers are well aware of the features of a counterfeited product, they can examine the products for the signs of fakes before purchasing the product.
Digital Anti-counterfeiting Solutions
There are ways to find out whether a finished product is real or fake. If a brand is not protected by a digital anti-counterfeiting solution then the customers must scrutinize the product packaging quality and check if there are any spelling mistakes. Brands can protect their customers against counterfeiting with the help of various anti-counterfeiting solutions available in the market.
These days, most people use smartphones, so an anti-counterfeiting solution that uses smartphones to check product authenticity can help a brand to turn its customers into an army against counterfeiting.
Some companies use pigments as identifiers. In some cases, iridescent images are added as identifiers.
Retail companies can also introduce a unique product identification number or code for every item manufactured. This code can be input on a website or scanned to find out whether it is authentic or not.
The more we advance, the better the technology we need to stop such fraudulent activities. Innovative solutions such as NeuroTags Solution can help brands prevent the counterfeiting of their products completely.
Please contact us to know more about the NeuroTags Anti-counterfeiting solution.