Counterfeiting is growing at a fast pace across the world. Different reports show disturbing figures related to counterfeiting.

According to Global Brand Counterfeiting Report, “The amount of total counterfeiting globally has reached 1.2 Trillion USD in 2017 and is bound to reach 1.82 Trillion USD by the year 2020 which includes counterfeiting of all equipment/products from defense equipment’s to counterfeiting of watches.”

The report also states that losses incurred by luxury brands because of the sale of counterfeiting through the internet accounted for 30.3 Billion USD.

A report by OECD states that trade in fake goods is 3.3% of the world trade.

Link between counterfeiting and criminal activities

The above-mentioned figures clearly point towards the high growth of counterfeiting over the last few years, however, counterfeiting has also led to the growth of other criminal activities.

Many organized criminals deal in the sale of counterfeit goods as it is a lucrative business and there are less severe punishments to deal with it. With the penetration of the internet in far-flung places, criminals are making huge profits by selling counterfeits in the e-commerce space.

So, what do these criminals do with the money made by selling counterfeit goods? In most cases, they use it to fuel other criminal activities like human trafficking, illegal arms trade, drug trade, and even terrorism.

One can remember the Charlie Hebdo attacks in France in which many people died. The gruesome attacks were carried out by selling fake sneakers. Many international organizations have established a close link between counterfeiting and other criminal activities.

Conclusion

Counterfeiting is a growing menace across the world. The crime promotes other heinous crimes and the vicious cycle continues without an end. However, counterfeiting can be prevented by increasing consumer awareness, strict implementation of regulatory measures and ensuring the use of anti-counterfeiting solutions.

To get the best of anti-counterfeiting solutions to safeguard your product and business call us on +91–785-785-7000 or drop us a mail at connect@ec2-54-210-245-44.compute-1.amazonaws.com.

 

The world is flooded with counterfeit products of all kinds, from fake Louis Vuitton bag to phoney Tissot watches, counterfeit Cartier pens to duplicate Adidas sneakers, fake Apple devices to fake MAC makeup kit- the list seems endless.

However, counterfeiting not just impacts luxurious brands but also affects those products which are affordable for the common man. With the growth of online trade, a large number of fake products and accessories are being sold online. Of late, global e-commerce giants like Amazon and Alibaba are suffering from the menace of counterfeit goods.

According to a report by Research and Markets, the global value of counterfeiting has reached a monstrous value of more than $1 trillion.

Impact of buying decisions on counterfeiting

Consumers play a major role in the impact of counterfeiting. While numerous buyers are being duped with fake products, there are many who knowingly buy fakes.

A recent report by OECD states that a large number of buyers in the UK were knowingly buying fakes. The report states, “Bulk of purchases of fashion and luxury-specific fakes did not occur by chance. Instead, nearly 60% of purchases of counterfeit fashion items in the UK were done intentionally by consumers who knew that they were buying fakes.”

According to a survey conducted by Civic Science in the US, “Around 10% of respondents had purchased a counterfeit knowingly.”

Over the years, there are many factors that have contributed to the rising consumer trend of knowingly buying fakes. Some of them are a rise of social media influencers, pop culture and a personal likeness for brands and luxurious goods. In a scenario when the common man is not able to purchase original costly items, he or she resorts to buying fake items- for fulfilling the desire.

The problem due to knowingly buying counterfeits

No wonder, there are numerous problems caused due to fake goods, however, in most cases, a consumer is not aware if he or she is buying a counterfeit or not.

The problem of knowingly buying fakes is a grave concern because in this scenario the consumer is promoting the sale of counterfeits. In such a case, awareness regarding fake brands turns futile and manufacturers are not able to take concrete action.

To deal with the same, strict regulatory measures should be implemented which prevent the sale of counterfeits on all the platforms. Moreover, manufacturers should resort to secure packaging solutions for enhanced supply chain security and inventory visibility.

Holostik’s anti-counterfeiting solutions

Holostik is a leading player in catering wide variety of anti-counterfeiting and IT-enabled supply chain solutions. Our products like security holograms, security labels, wads, shrink sleeves combined with digital authentication help in preventing counterfeits and the safety of the supply chain.

To know more about solutions, you can call us on +91–785-785-7000 or drop us a mail at connect@ec2-54-210-245-44.compute-1.amazonaws.com

Fake electronic products are easily available in different market locations and also on e-commerce. There have been numerous reports of fake electronic goods and parts seized by authorities in different parts of the world. Of late, the immense popularity of mobile phones has made them highly susceptible to counterfeiting. You can easily spot a fake versions of mobile phone accessories being sold at the pavement or small shops.

The scenario of counterfeit electronics

According to a report published by CSC, “Consumer electronics is pegged as the fastest-growing category of counterfeited goods across the world.” The report also states that, “Electronics counterfeiting is a $169 billion industry worldwide.”

Some of the most counterfeited electronic products as per the report are smartphones, computers, tablets etc. The report makes a shocking claim that an average counterfeit phone sells for $45 approximately in the $6 billion dollar market.

The problem of counterfeit electronics

The counterfeit electronics industry has also created a challenge for manufacturers and consumers in India. Besides duping the consumer of his hard-earned money, it also creates a bottleneck for the manufacturer. Many companies are not able to recover from the damage caused due to fake products – for years.

The solution for counterfeit electronics

Holostik has been catering its anti-counterfeiting solution to a large number of companies from the electronics industry. We have state-of-the-art anti-duplication, packaging and labeling solutions that ensure complete safety of your products and the supply chain.

Some of our products for the electronics industry are as follows:

Security labels

Security Holograms

Security pouches

Hot stamping foil

Holographic packaging films

Conclusion

Counterfeit electronics may be tempting for the consumer, but they can bring along a lot of problems like malfunctions, damages, poor quality of the hardware and even a deadly phone blast in your pocket or on your face. Manufacturers, on the other hand, have to face a drop down in profits and sales. Amidst this grim scenario, anti-counterfeiting solutions can play an indispensable role in the prevention of counterfeiting. To know more about our solutions call us on +91–785-785-7000 or drop us a mail at connect@ec2-54-210-245-44.compute-1.amazonaws.com.

Of late, the FMCG sector has been suffering from the problem of counterfeiting. As per a report by FICCI CASCADE around 35% of FMCG items are fake. The study also reveals that around 80% of consumers believe that they are buying genuine goods.

The growth of fake goods in the FMCG sector has had an impact on both consumers and producers. While the manufacturers suffer from a tarnished brand image and low sales the consumer is at the risk of losing money and a bad impact on his or her health. He also says that unscrupulous manufacturers are also detrimental to the national economy.

Counterfeiters also repackage fake goods to make them visually similar to the genuine ones. It has been seen that old plastic water bottles are being repackaged and sold in the market, the same is the case with many other goods. Such deceptive duplication leads to a loss of consumers and brand owners as well.

In India, a large number of the population settled in rural parts of the country suffer from rampant counterfeiting of FMCG goods. With a little check of authorities and poor regulation and manufacturing guidelines counterfeiting is easily slipping in the pockets of the common man.

Advancements in technology and easy procurement of the same have made it possible for counterfeiters to establish little backyard factories and hubs for the manufacturing of duplicate items. It has also been observed that counterfeiters are making fake labels and packaging to dupe consumers. In the year 2014-2015 sale of FMCG, tobacco and alcoholic beverages constituted 65 percent of the total sales.

Holistik provides customized anti-counterfeiting, packaging and labeling solutions to deal with the problem of counterfeiting in the FMCG sector. To know more about our unique anti-counterfeiting solutions call us on +91–785-785-7000 or mail us at connect@ec2-54-210-245-44.compute-1.amazonaws.com.

Many people don’t take the crime of counterfeiting seriously, they think that counterfeiting will not impact their lives, however, the fact is that counterfeiting has many negative impacts on the common man and thus has been named as the ‘Crime of the 21st century by Federal Bureau of Investigation.

On the global scale, the value of counterfeiting has reached a high of approximately 1 trillion dollars whereas, in India, the figure has shot up to I lakh crore annually. These figures clearly show the grim scenario of the situation.

Counterfeiting not only impacts the global economy but is a challenge for the governments, business organizations and most importantly the consumers. Counterfeiting not just dupes the consumer of his hard-earned money but also affects his health, besides this, there are many far-reaching impacts of counterfeiting on consumers. Let’s discuss the same.

Negatively affects the consumer’s health: What could be more dangerous than a counterfeit life-saving drug. Counterfeit medicines have created havoc in the industry, and it has become increasingly difficult to control them. Counterfeit or substandard medicines can have serious side effects on the human body and in some cases can even lead to death.

Dupes the consumer financially: Consumers who unknowingly purchase fake goods have to pay an actual price for a counterfeit. While it may sound good to purchase an original product at high prices but for a counterfeit, it is not at all good in any sense as you have compromise on quality.

Creates unemployment: There is a clear link between the rise of counterfeiting and the rise in unemployment. The business of counterfeits leads to monetary losses for the manufacturers which in turn affects the expenditure on current and future employees.

Poor infrastructure: Today’s common man needs beyond ‘roti, kapda, and makaan’. The government spends a good amount of money every year on rural and urban infrastructure. This money is collected from the taxes levied by the government on the business organizations and the common man. Since counterfeits evade taxes it leads to a drop-down in the money spent on infrastructure and development.

From knock-off fashion accessories to fake mobile phones, automotive parts and pharmaceuticals, counterfeiters manufacture and sell inferior goods using another company’s trademark, brand name, logo or appearance. Benefiting from rapid developments in technology, these organizations use sophisticated means to duplicate items, making it quite difficult for customers to identify the true source of the products they purchase.

Counterfeiting is a serious crime punishable globally by fines that may run into millions of dollars and imprisonment of up to 20 years. Despite this, the counterfeit industry continues to cost the world economy hundreds of billions of dollars each year.

The Organization for Economic Cooperation and Development (OECD), an intergovernmental economic organization for world trade, estimates that trafficking in counterfeit products accounted for USD 250 billion in 2007⁠⁠ — approximately 1.95% of international trade. According to the International Chamber of Commerce, counterfeiting was a USD 600 billion business in 2011, amounting to 5% – 7% of global trade.

In a March 2019 report, OECD stated that trade in counterfeit and pirated goods has risen steadily in the last few years, even as overall trade volumes stagnated. According to the estimates, counterfeit trade currently stands at 3.3% of global trade.

Counterfeiting organizations are often linked to other organized crimes such as drug cartels, money laundering and exploitation of child labor. Even as law enforcement agencies increase efforts to shut down the illicit business, statistics point toward continued exponential growth in the sale and manufacture of counterfeit goods worldwide.

The need for effective risk management in the supply chain

  • China is estimated to account for 78.5% of the total counterfeit market, and along with Hong Kong, continues to be among the biggest origin countries for pirated goods.
  • Footwear, clothing, leather goods and electrical equipment are the top product categories targeted by counterfeit organizations.
  • Counterfeit and pirated products continue to follow complex trading routes, targeting certain intermediary transit points in supply chains, especially in countries where ports are not secured.
  • In 2016, up to 6.8% of EU imports comprised of counterfeit and pirated products. This amounts to as much as €121 billion.

Although it affects every product category, counterfeiting is more accentuated for businesses with a globalized supply chain. Supply chain management at large corporations can involve hundreds of links with each of those susceptible to intrusion by counterfeit organizations.

Counterfeit items can enter legitimate supply distribution chains at a number of points — the various component manufacturers, suppliers of raw materials, offshore assembly units, transportation, and even the retailers.

If not checked for quality, sources, proper delivery and authenticity throughout the supply chain, high-quality products may get replaced by cheap knock-offs at any point most convenient to counterfeiters.

As laws differ in countries, a manufacturer could potentially leave their product open to counterfeiting at any point in the supply chain when they target a market in a developing country. The market is characterized by businesses working with governments to reduce counterfeit trade. Preventive measures such as penalization, customs laws, and civil remedies work to some extent but fail to significantly reduce the problem. Often, in developing countries, regulatory authorities are ill-equipped to correctly identify original products from fakes.

There is an undeniable need to develop a far-reaching strategic approach to counter such criminal efforts with a multidisciplinary response and the active participation of a wide range of actors, each with their own expertise and specific areas of work.

The role of technology may offer significant contributions to step up deterrence and curb counterfeiting. The two most common technological solutions that companies employ are product authentication and track-and-trace systems.

Product authentication

Authentication methods allow customers to identify whether the products they’ve purchased are genuine or counterfeit. This usually involves assigning security holograms, QR codes and unique numbers or patterns to each product after the final quality check at the manufacturing unit. Scanning the unique code on their smartphone allows the customer to verify the genuineness of the product while informing the manufacturer about its successful sale. Security holograms for authentication can be found on nearly all credit and debit cards.

Track-and-trace systems

Track-and-trace systems are designed to help manufacturers identify faults in their supply chain. As the name suggests, these systems allow manufacturers to track product journey along the entire supply distribution chain from the production unit to end-customer, and customers to trace the products back to their original source.

Smart QR codes (in the form of labels or holograms) are assigned to each product. These are then scanned at every link in the supply chain using either specialized devices or smartphones. Failure to scan the right code on the right product reflects immediately in the supply chain database and allows the manufacturer to identify the point of failure and take appropriate action. This dramatically reduces the chances of intrusion by counterfeit organizations into the legitimate supply chain.

Added benefits

Anti-counterfeiting solutions such as track-and-trace systems allow manufacturers to not only keep track of their inventory at all stages of distribution but also make it easier to manage rewards and build customer loyalty. For more information on this, click here.

Conclusion

Counterfeiting is an exceedingly complex phenomenon. Legal deterrence like fines and imprisonment work to reduce the spread of fraud but do not eliminate it entirely.

With the global counterfeit industry on the rise, companies must take advantage of technological solutions to fight counterfeit. Some of the most effective methods include product authentication methods and track-and-trace systems.

While immensely effective in nearly eliminating the intrusion of counterfeit goods into legitimate supply chains, these solutions also offer added benefits such as comprehensive supply chain management, reward management, and loyalty-building.

For more on supply chain security, click here. To find an ideal track-and-trace solution for your business, click here.

The world is a global village as there is a high interdependence of countries on each other in different fields. From world-wide-web to culture, technological innovation to trade, military alliances to transport there are many scenarios in which the world seems to function as a unified whole.

Among the above-mentioned aspects, trade and investment play an important role in the economic development of countries. Of late, Foreign Direct Investment (FDI) has become quite important for third world countries when it comes to their economic development. FDI impacts the economic growth of the host country (a country in which investment is done) through the transfer of new technologies, organization of human resources, increase in employment, linking of global markets, the rise of infrastructure and much more.

However, the rise of counterfeiting can damage the FDI prospects of a country and its potential to create valuable innovation centres. FDI is important for both advanced and emerging economies to increase their productivity and output. Lack of intellectual property rights and anti-counterfeiting measures diminish the chances of FDI. In India, the industries most impacted by lack of FDI due to counterfeiting include equipment manufacturing and pharmaceuticals.

The total reduction in FDI due to counterfeiting and piracy is quite harmful to aspects like employment, infrastructure and socio-economic development. Countries are sceptical of investing in prospecting countries with weak IP laws as it may lead to counterfeiting of their products, theft of their technologies, reduction in their profits and damage to the brand image.

With the implementation of stringent regulatory measures and anti-counterfeiting technologies, duplication can be prevented to a large extent which will further brighten the chances of foreign direct investment. For ensuring impeccable security against counterfeiting it is must that supply chains must also be secured. A comprehensive outlook towards anti-counterfeiting guarantees the economic development of a country.

If you require customized anti-duplication solutions for securing your products and supply chains, then call us on +91–785-785-7000 or mail us at connect@ec2-54-210-245-44.compute-1.amazonaws.com

There has been a humungous growth of fake brands in different industries. From counterfeit apparels to spurious medicines, fake footwear to duplicate watches the list seems endless. According to Global Brand Counterfeiting Report, “The amount of total counterfeiting globally has reached to 1.2 Trillion USD in 2017 and is bound to reach 1.82 Trillion USD by the year 2020.”

Brands are not just losing millions of dollars every year due to counterfeit products but are also facing many other challenges. Perhaps, one of the biggest challenges faced by organizations due to counterfeiting is the damage to their brand reputation.

Over the past few years, the proliferation of fake goods has bought a major change in consumer buying behavior. According to sources, a large number of consumers are less likely to buy products from a brand if its reputation has been tarnished due to counterfeit goods. Even in the e-commerce space, consumers are less likely to buy products from websites that have earned a bad name due to counterfeiting.

Counterfeit products have a direct impact on the confidence of the consumers buying a brand. A large number of consumers who have purchased fake products unknowingly never buy the same product again and tend to switch over to another brand.

If a consumer is duped into buying a fake product and later discovers that the product is not worthwhile then it leads to a blow on his confidence in the product and the brand. Moreover, such brands are more susceptible to negative word-of-mouth publicity.

So, if a consumer receives a fake product then there are high chances that the genuine brand and manufacturer may earn a bad reputation.

In the online space, customers leave negative reviews for such brands which jeopardize their reputation. This sometimes creates a false narrative that even brands manufacture low-quality goods. Regular news related to counterfeiting of a specific brand can create an assumption in the minds of consumers that the brand is not serious regarding duplication and is not taking stern measures against counterfeiting.

However, companies across the world are now taking serious measures against the problem of counterfeiting. The online retail giant Alibaba which has earned a bad repute for counterfeit products has made a task force to handle counterfeits on its platform. Besides organizations have also implemented different anti-counterfeiting products and solutions to secure their products and brand.

Holostik provides tailor-made anti-counterfeiting products and solutions which help in securing the product and the brand’s image from the problem of counterfeiting. If you are facing the problem of duplication call us now on +91–785-785-7000 or mail us at connect@ec2-54-210-245-44.compute-1.amazonaws.com.

Counterfeiting is a trillion-dollar illegal business having its presence in almost every part of the world. Today, counterfeiting is posing a threat to not just the consumers but also to the economic growth of the nations.

According to an OECD and EUIPO report, “Global sales of counterfeit and pirated goods have soared to 460 billion euros ($522 billion) a year, amounting to a whopping 3.3 per cent of world trade.”

The report also states the nations most affected by counterfeiting which includes the United States, Japan, South Korea and the EU states. However, the effects of counterfeiting are not just visible in developed countries but are also hampering the growth of the developing world.

Let’s discuss some of the impacts of counterfeiting on the economy of a country:

Evasion of taxes: Counterfeiting leads to evasion of taxes. The mammoth counterfeiting industry sells its products in the market without paying taxes to the government. This leads to a loss of the government exchequer and finally, the government is not able to spend enough on welfare projects and schemes.

Rise in unemployment: Since the counterfeit industry takes away the profits of credible companies, they are not able to recruit new employees. The financial instability of the industries creates massive unemployment which is linked indirectly to the problem of counterfeiting.

Diminishes foreign investment: It has been generally seen that countries with weak IP laws and poor regulatory measures become the breeding ground for counterfeit activities. Such countries blur their chances of foreign investments. Counterfeiting diminishes the chances of foreign direct investments and thus block the economic growth of a country.

Fuels other black-market activities: Counterfeiting fuels other black-market activities and is a lucrative business for organized criminals. With the money acquired from the sale of counterfeits, they fund their vast network, which is involved in drugs trafficking, human trafficking, illegal arms, prostitution etc.

Finally, we can conclude that counterfeiting has multiple negative effects, which are very harmful to the economic growth of the country if not checked on time by authorities and the respective governments of their countries.

To get the best anti-duplication and products and solutions call us on +91–785-785-7000 or mail us at connect@ec2-54-210-245-44.compute-1.amazonaws.com.

International law enforcement and market experts have established a close link between counterfeiting and other forms of criminal activities. It has been found that the counterfeiting business helps criminals to fuel other illegal activities and vice-versa. EUROPOL (European Union Agency for Law Enforcement Cooperation) has even warned that counterfeiting is an increasingly attractive avenue for organized crime syndicates to diversify and increase their illicit businesses.

It has also been found that counterfeiters use similar routes and modus operandi to supply counterfeit goods as they do to smuggle drugs, firearms and human trafficking. Profits from other crimes and illicit activities also help in the production and distribution of counterfeit goods. Many reports from different countries have established the fact that profits from crimes like drug trafficking and other crimes were used to promote the business of counterfeiting and, similarly proceeds from the sale of duplicate goods were used to promote the criminal’s other illicit activities.

One of the main reasons why criminals choose counterfeiting over other criminal activities is due to its favourable ratio between potential profits and possible risks. According to Executive Director, UNODC (United Nations Office on Drugs and Crime) Yuri Fedotov, “In comparison to other crimes such as drug trafficking, the production and distribution of counterfeit goods present a low-risk/high-profit opportunity for criminals. Counterfeiting feeds money laundering activities and encourages corruption. There is also evidence of some involvement or overlap with drug trafficking and other serious crimes.”

As per trade, reports counterfeiting is now placed amongst the highest income sources for organized criminal activities. Counterfeiting or duplication also helps in money laundering by providing a platform through which criminal organization can invest the proceeds of their illicit activities. In a nutshell, organized crime syndicates use counterfeiting as a medium to optimize their other criminal activities.