Counterfeiting of luxury goods- a rising problem for manufacturers

Some of the well-renowned luxury brands like Hermes, Louis Vuitton, Gucci, Adidas etc. have been facing the problem of counterfeiting across the world. Luxury products once available for the elite are now widely available for the rising middle class at slashed prices but mostly in the form of fakes. With the increase in globalisation consumers have become more brand conscious and people are spending a good amount of money on buying costly products. Along with this, the e-commerce market players are heavily investing in selling different kinds of luxury products on their platform.

The growing penchant for e-commerce, the intoxicating pop culture and the average young consumer base which is around 67% of India’s population has led to a massive rise in the demand for luxurious products.

According to trade reports, “Luxury Goods Market is expected to garner $429,762 Million by 2022, growing at a prominent CAGR of 3.9% from 2016 to 2022. Luxury goods are high-value products in terms of price and quality. These goods are mostly considered as status symbols for individuals.”

However, “The Global Brand Counterfeiting Report 2018 estimates that the losses suffered due to global online counterfeiting has amounted to 323 Billion USD in the year 2017, with luxury brands incurring a loss of 30.3 billion dollars through internet sales.”

The global luxury counterfeit market is growing with every passing day. With the availability of technology and poor regulation policies, counterfeiters have been able to develop new counterfeit products. China is a prominent hub of luxury counterfeit products and supplies it to different parts of the world.

From luxury totes to enticing ultra-luxury jewellery all things for the rich and famous are available for you now with ease but only in its duplicate form. The problem of counterfeiting of luxury items can only be eradicated with the use of combined digital and physical security and strict regulation.

Holostik’s R&D center gets recognition from Department of Scientific and Industrial Research

In a recent development, Holostik’s research and development centre got recognition from the Department of Scientific and Industrial Research, Ministry of Science and Technology, Govt. of India. With this achievement, Holostik added one more jewel to its crown and has entered in the league of few esteemed companies with the prestigious certification in India.

Holostik’s in-house state-of-the-art research and development centre is located at Rudrapur in Uttarakhand. Inspired by its vision of constant innovation and the use of cutting-edge technology, the R&D centre of excellence has proved its mettle in the world of holographic and other anti-counterfeiting technologies over the years.

Mr U.K. Gupta Chairman and Founder Holostik India Limited expressed his happiness on achieving the new milestone and said that his company would be making pathbreaking innovations for securing brands and products against the problem of counterfeiting. The recognition from Department of Scientific and Industrial Research, Ministry of Science and Technology would not have been possible without the persistent efforts of Mr U.K Gupta and his entire team at Holostik.

In the past Holostik India Limited became the only anti-counterfeiting company to receive CMMI Level 3 certification. Moreover, the company has also earned certifications from Indian Banks’ Association, Agmark, DMF, CRISIL, HSSMS, OHSAS, ISO 9001, 14001, 18001 & 27001. The company is also a member of elite business associations like PHD Chamber of Commerce, ASSOCHAM, CII, ASPA, FICCI, IHMA and others.

Established in the year 1991, Holostik is one of the leaders in providing anti-duplication and packaging solutions. At the pinnacle of success, it is one of the biggest manufacturers of security holograms in the world. The company also provides a gamut of integrated IT-enabled authentication solutions to its customers. Holostik caters to more than 75 countries and has 10,000+ clients from different industries.

Beverly Hills polo club cries out for counterfeit chaos

In a probable first, the Delhi High Court yesterday restrained Amazon Export Sales LLC from selling counterfeit products through its Amazon Global Store on www.amazon.in. The action for trademark infringement has been brought by the global brand Beverly Hills Polo Club against Amazon India and Amazon Export Sales LLC (which operates through the Global Store platform of Amazon).

As a background Beverly Hills Polo earlier, this year had claimed that some of Amazon’s sellers were involved in widespread supply and sale of counterfeit goods. “The defendant shall remove forthwith from its platform any URLs which are pointed out by the plaintiff which are selling products in violation of the plaintiff ’s right,” a July 2018 court ruling said so.

The Delhi High Court has also directed Amazon Export Sales LLC to disclose the details of all its suppliers who provide the counterfeit product stock to the Amazon Global Store for further resale. Beverly Hills Polo Club has dragged Amazon to Court claiming that it was knowingly and directly both selling as well as harbouring counterfeiting activities, which were being actively promoted by its Global Store as well as by third-party sellers on Amazon.in.

“Counterfeiting activities on Amazon have seriously impacted the brand in India. Due to the safe harbour provided to infringers by Amazon, we do not have fair access to the Indian market. Due to the rapid expansion of e-commerce shopping in India, of which Amazon is both credible and dominant in India with the offer of cheap and inferior counterfeit products by Amazon’s own store as well as third parties, the Brand has been impacted. Amazon is clearly abusing its dominant position in the Indian market.

There ought to be check and balances under any law such that rights are not unfairly exploited. Despite our continuing notification to Amazon of infringing activities, sold directly by Amazon, as well as by third-party sellers, Amazon has continued its illegal and abusive practices and actively promoted the sale of counterfeit products,” said, Eli Haddad, Founder & Managing Director, Beverly Hills Polo Club.

Sim and San, Attorneys at Law, represented Beverly Hills Polo Club in the matter.

Source: businesswireindia.com

What you should do to avoid fake products?

The first line of defence against counterfeiting is the awareness against duplicate products. It is highly important for you to get acquainted with the information which will help you in identifying fakes products to a large extent however, it is not completely possible to spot fakes. Here are some points which you must keep in mind to determine the genuineness of a product:

Look closely at the labels and packaging 

Look at the labels, packaging, printing and the text closely. If you notice any flaw in the spellings, grammar, print quality or any other discrepancies then it could be a sign of counterfeit. Also, be cautious of products that include a ‘Made in China’ unless and until the product is merchandise manufactured in China, perform a web search for it.

Go for an authorised dealer

Always go for an authorised dealer while purchasing or replacing products. This is highly important in a scenario where you are purchasing or replacing spare parts for automobiles, aeroplanes and other items.

Are there no taxes?

Always be cautious of deals which allow you to purchase without value added tax, sales tax etc. This is usually in case of counterfeits which evade huge amount of taxes every year.

Purchase from a secure e-commerce website

Try to avoid purchasing from websites that do not have https in their domain. The ‘s’ in https stands for secure which is generally used by authorised and credible websites. Legitimate retailers will always ensure that their customers buy through a secure setting and are not duped with counterfeits.

Is the deal to good to be true?

One of the biggest giveaways for consumers is that ‘a deal is too good to be true’. Seasonal discounts or factory prices are fine but if the prices are too low compared to the regular price of the product then there are high chances that the product is a counterfeit. Take a cue from this and thoroughly check the labels and tags of the product.

Look for holographic and digital authentication

Last but not least is to visually identify security holograms or digitally authenticate QR codes and bar codes printed on the product. Due to the rise of counterfeiting companies are using security holograms and QR codes on their products. Security holograms are 3D holographic devices with optical properties and show different images or features corresponding to the angle of viewing. Try to view the holograms from different angles and you will be able to notice the different colours and images in it. There are also other covert features which can only be viewed with special instruments. For QR code authentication you will require a QR code scanning mobile application which will determine the genuineness of the product.

counterfeit textbooks

Amazon counters textbook duplication in a sting operation

International e-commerce giant Amazon is tackling the sales of duplicate textbooks on its US site after it came to know that many booksellers were allegedly selling counterfeit books revealed through a major online sting operation.

A media platform had reported that Amazon had conducted a sting operation which leads to the suspension of many US booksellers who were shipping fake textbooks.

A spokesperson from Amazon said that the counterfeit books were caught through a test buy program which is a part of major anti-counterfeiting action. The publishers of the books said that the books were fake, so they had to take action to protect their customers.

Prominent publishers like Cengage, Elsevier, Macmillan Learning, Mc Graw-Hill Education and Pearson collaborated on a website stopcounterfeitbooks.com which was intended to raise awareness of the problem of duplication they say is ‘significantly’ contributing to the decline of textbook revenues.

The website states that duplicate books are a substantial problem in the educational marketplace which is burdening students with cheap quality products; exposing distributors to legal liability and unsaleable inventory; and depriving authors and publishers of the funds necessary to reinvest in new educational content

Source: thebookseller.com

The role of anti-counterfeiting technology against duplication

The counterfeiting of products and tampering within supply chains has become a massive problem at the global scale. The overall cost of counterfeiting and diversion is projected to reach $2.8 trillion by 2022. The problem of duplication has infiltrated industries like health, beauty, pharmaceutical, liquor industry and many others.

Consumers and companies are facing the onslaught of counterfeiting and adulteration. Products from food to medicines are being forged by counterfeiters around the world. Counterfeiters also try to sell stolen, adulterated and expired items as originals. Forgers try their level best to visually and functionally mimic the product and original packaging. There have been reports of duplicate products and its effects from across the world which creates a sense of anxiety among consumers and plummets our trust in reliable and major brands.  Counterfeiting can be countered effectively on different levels. Government and regulations play an important role in battling duplication but one of the most decisive roles is that of technology. Technology not just helps in determining the genuineness of the product but also helps in securing supply chains against duplication and tampering.

Anti-counterfeiting technology can be divided into four groups namely overt, covert, forensic and digital. All those authentication technologies which can be seen with naked eyes are called as overt technologies whereas those technologies which cannot be seen with naked eye and requires special devices like UV pen and taggant pen are called as covert technologies. Forensic technology requires special labs for performing authentication and digital technology encompasses the use of QR codes and other IT enabled technologies.

Holographic technology which falls under overt and covert technology is one of the most widely used and affordable in nature. A good example is the use of security holograms and holographic wide web films in different industries for product authentication purposes. The holographic technology can encompass a wide variety of security features which are difficult to replicate thus making it impossible for counterfeiters to copy them.

However, with advances in digital authentication technology, it has become possible to secure entire supply chains. The use of QR codes and barcodes for authentication is a good example. Amidst the growth of different authentication technologies, all of them are complementing each other and not competing. For example, Holostik which is a pioneer in providing anti-counterfeiting solutions offers security instruments which include security holograms and QR codes. While holograms offer holographic authentication, QR codes helps to digitally secure the product throughout the supply chain.

Apple, Michael Kors among world’s most counterfeited brands

Many popular retailers depend on brand recognition to increase sales but at the same time, forgers also utilise brand names to make counterfeits in their names.

Forgers use logos and trademarks of companies like Nike or Michael Kors to sell duplicate products to the public. U.S customs officials recently seized more than 9,000 fake Nike sneakers worth nearly $1.7 million in a shipment from China bound for the U.S.

Nike said in a statement to FOX Business that Nike aggressively protects its brand image, its retailers and its consumers against duplication across the world. The company further said that they would recommend to consumers who want to buy genuine Nike product should go to a recognized retailer or an official Nike store.

The U.S Customs and Border Protection officers confiscated more than 34,000 duplicate products worth $1.2 billion in fiscal 2017 alone. The anti-counterfeiting move lead to arrest and indictments. The total amounted of confiscated fake goods was worth $3.3 million.

Source: FOXBusiness

Securing supply chains against duplication and ways to do it

People who are victims of theft, robbery, fire, flood or other disasters often complain about the powerlessness they have over the situation. The gruesome situation can create an enormous amount of financial burden and can cause irreparable loss to the individual and organisations.

But just as individuals can take necessary measures to protect their products and properties similarly organisations and company owners can take the necessary measures to secure their supply chains. Different technology tools can be used as effective solutions to secure supply chains.

One of the biggest threats faced by companies is the problem of duplication. Counterfeiting or duplication can take place at any stage of the supply chain. Since the supply chain encompasses different stages, therefore, it is difficult to individually monitor each of them. Moreover, it is manually not feasible to examine loopholes or any errors in the supply chain.

Of late, different kinds of technologies are being used to secure and monitor supply chains. Particularly IT technology in amalgamation with holographic technology is being used by companies worldwide. A good example is the use of barcode or QR code which not just digitally authenticates the products but also links it with different IT-enabled technologies like track and trace, supply chain management, reward management, inventory management, marketing campaigns and other functionalities.

Digital authentication through a QR code and barcode take place on the individual product, pack, case and pallet level. Variable and unique QR codes are difficult to copy and provide security on each level of the supply chain. Holostik a pioneer of anti-counterfeiting solutions and provides a range of holographic and digital authentication solutions for securing supply chains. Its security holograms enabled with digital authentication solutions helps in providing a multi-layered security approach to the product and the company.

Duplication of spices- a growing threat!

All kinds of markets whether big or small have a range of spices. India is a country where different kinds of foods are eaten, and spices play a dominant role in making the regional delicacies. The usage of spices in dishes depends on the location and the mass production of a particular spice in a particular area. Climate and geography also play a major role in determining the production and demand for spices.

But counterfeiting of spices has become a common affair and there is hardly any place left where counterfeit spices are not available. From black pepper to cinnamon, cloves to turmeric and bay leaves a wide variety of spices have fakes readily available in the market. These duplicate spices are usually cheap and thus pose a threat to the original spice manufacturing companies. Many times, the spices are adulterated with harmful chemicals to make them look visually similar, this causes a wide number of ailments in the consumers.

Forgers also sell very old spices in the name of fresh aromatic spices. Storing spices for a very long time reduces their quality and taste. Besides this point, forgers employ deceitful tactics to sell spices in the market. They often pack entirely different contents in place of the original. For example, papaya seeds are used in place of black pepper or common wooden birch in place of cinnamon. In many cases, the spices are also dyed to make them look visually similar to the original product.

There are certain spices that are substituted or diluted. Fake labels are also placed on the packaging to give them the look of the original. Here are some common spices and their adulterants.

Cinnamon

In the U.S., what’s commonly sold as cinnamon is actually cassia, a cousin of true cinnamon.

Saffron

Those little orange threads you bought aren’t saffron, they’re probably flowers from other harmless plants, most often calendula.

Black Pepper

Papaya seeds sold as ground pepper are clearly mislabelled, but they won’t do you any harm.

Chilli Powder

Chilli powder has also been found to contain brick powder, talc, and even sand and dirt.

Apply Delhi high court judgement on e-commerce – asks seller body

According to a judgement by Delhi High Court, last month on counterfeit products sold on ShopClues an association has asked to implement the judgement on the entire e-commerce.  The judgement mentioned that e-commerce was not taking enough steps to curb the sale of counterfeit products. The association of online vendors has written to the government asking for applying guidelines laid out by the court to all e-commerce marketplaces in India.

While complaining against ShopClues the American electronics brand Skullcandy mentioned that its counterfeit products were being sold on the platform. The Delhi High Court has asked the Tiger global based company that it maintains all the necessary guidelines to ensure the authenticity of products on its platform.

However, ShopClues has not responded to specific queries on the steps that were being followed. All India Online Vendors Association has written to the government and the Consumers Affairs Ministry to direct all marketplaces according to the guidelines laid by the law.

Earlier ShopClues has been pulled up for a similar issue of counterfeit products in a judgement where it was barred from selling counterfeit products of French cosmetics company L’Oreal.

Source: Economic Times