Why securing supply chains is important for manufacturers?

Supply chains are like the nervous system of organizations. A healthy supply chain ensures that a company is progressing on the growth path.  Supply chains should always be on high priority of companies as loopholes in the supply chain can lead to an escalation of costs, poor delivery management and a threat to intellectual property. Moreover, the supply of tampered and counterfeit products can lead to unwanted legal issues and a blot on the brand image.

Today, supply chains are prone to threats like theft, sabotage, terrorism, malware attacks, piracy etc. While threats cannot be completely erased, certain security measures can help to secure supply chains.

Holostik which is a pioneer in providing anti-duplication products and solutions also provides comprehensive and customised supply chain management solutions to companies. Moving a step ahead in anti-duplication technology the company helps to secure

Nowadays, companies are facing the regular threat of duplication. Counterfeiting or duplication can take place at any stage of the supply chain. However, monitoring the entire supply chain is a herculean task and manually it is challenging to examine loopholes or errors in the complete supply chain of a company.

In order to secure the supply chains against the menace of duplication different kind of technologies have been put into use. However, the most effective among them is the use of track and trace technology which closely monitors the movement and quantity of the product across the supply chain. Holostik provides a customised barcode or QR code along with a security hologram to products. This helps in not just authenticating the product but also helps in the implementation of other IT enabled solutions like track and trace, supply chain management, reward management, inventory management etc.

Digital authentication can take place through a QR code and bar code can take place on an individual product, pack case and pallet. The highlighting feature of this security product is that it cannot be copied easily due to the presence of physical hologram along with the QR code.

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.

To get the best solutions for your supply chain, call us on +91–785-785-7000 or mail us at connect@holostik.com.

How does counterfeiting affects consumers?

Counterfeiting or duplication is a growing menace which has an evil impact on different industries. Organisations lose millions of dollars every year due to the sale of counterfeit products. The problem of duplication has sneaked in every sector. It is estimated that by 2022, the value of counterfeit and pirated goods will be around $1.90 -$2.81 trillion as per FICCI.

Most of the times the repeated attempts of organizations to fight the counterfeits have turned futile. A large amount of money and resources are spent on fighting fakes. However, it is not just the companies which are facing the wrath of counterfeit products, consumers also bear its brunt. To say it simply, there are many impacts of duplication on the consumers.

Duplication poses a significant risk to consumers. Counterfeit goods can lead to injuries, illnesses, death as in the case of counterfeit drugs. In cases where counterfeit goods cause no physical harm, consumers are harmed financially when they are duped into spending their hard-earned cash for a poor-quality fake.

Let’s discuss the negative effects of counterfeiting on consumers.

Fake products are harmful to the health of consumers: Whether it’s a counterfeit drug, counterfeit alcohol or a fake food item all are harmful to the health of the consumers. People who consume these items generally report of food poisoning, nausea, indigestion, kidney and liver ailments.

Duplicate products lead to the monetary loss of the consumers: Besides having a negative impact on health fake products also lead to the financial loss of the consumers. Every year it’s not just the companies but consumers also lose an enormous amount of money as they are duped due to fake products.

Consumers lose trust in the product and the brand: Many a time a product or a service is beneficial for the consumer but due to the sale of counterfeits original products and companies lose their credibility. This brings down the reputation of the brands in the long run and a company is not able to win the trust of the consumer again.

What is an ideal packaging solution for the product and the brand?

The packaging is important for multiple aspects of the product and the brand. It is not just solely responsible for protecting the product but in fact leverages the brand image many times. Market experts consider packaging as one of the important aspects of product and brand marketing.

Let’s discuss the significance of packaging through these points:

Product protection: One of the first aims of packaging is to secure the products against any kind of harm or breakdown through different phases of the supply chain. In order to safeguard the product, it is processed through different stages of packaging which are primary packaging, secondary packaging and tertiary packaging. The packaging of a product also depends on the type and nature of its content.

Marketing: An ideal packaging also helps in promoting the product and the brand. A good packaging intends to leverage the brand value. A beautifully packaged product instantly catches the attention of the consumers from the shelf. Moreover, a well-packaged product outshines other competing products.

Anti-duplication features: Counterfeiting is one of the biggest threats to products and brands. It not just leads to loss for companies but also wreaks havoc on the product and brand image of the companies. An ideal packaging must include anti-counterfeiting protection like holograms, security labels, QR codes, scratch codes among others.

Recyclable: Packaging leads to a large amount of waste generation. Plastic and plastic-based products are creating an ecological imbalance. This has led to the development of new packaging products which can be recycled after use. More and more companies are laying emphasis on using recyclable packaging solutions for their products.

No wonder, all the points discussed above are being implemented in the development of new packaging products. It is high time that organizations pay heed to multiple aspects of packaging in order to boost their product and brand in the market.

The link between counterfeiting and organized crime

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.

The power of combination of different anti-counterfeiting technologies

With the easy availability of advanced technology, it has become quite normal for counterfeiters to make copies of the even most sophisticated of products. Today, counterfeiters not just imitate the product but also copy the packaging and branding of the company. This makes it quite challenging for the retailer and consumers to differentiate between original and fake products.

Counterfeiting today is an organized business usually run by big criminal organizations which involve a huge amount of funding and vast networking. However, with the development of anti-counterfeiting technology, it has become challenging for counterfeiters to duplicate products. Anti-counterfeiting technologies are broadly classified as overt, covert, forensic and digital. The most prominent among these are holographic and digital technologies which are currently being used in different industries.

Holostik is a pioneer in providing the best anti-counterfeiting solutions. The company has achieved many milestones in the anti-counterfeiting business. Holostik has emerged as a world leader in providing the best security holograms, security labels, holographic wide web films and many other products. Besides these, the company also provided digital anti-counterfeiting technologies which not just secures the product but also safeguards the supply chains.

Holostik believes that in today’s word different anti-counterfeiting technologies are not competing but are complementary to each other. Taking a cue from the same Holostik provides advanced and customised digital security holograms. These holograms encompass different features of holography along with QR code.

The USP of these holograms is its two-layered security which makes it impossible to breach by a counterfeiter. For example, if a forger copies the QR code then he won’t be able to copy the hologram due to its physical security features. Holostik firmly believes that the future of anti-counterfeiting technology lies in the amalgamation of different technologies. Moreover, the implementation of digital technologies also helps in monitoring and effectively managing the supply chains.

The impact of counterfeiting on the Indian apparel industry

The local clothing industry is the second biggest supporter of the retail business after FMCG. It is valued around Rs 3 lakh crores. The popularity of global brands, changes in inclinations from non-branded to branded, a quickly developing economy and a substantial youthful purchaser base in has made India a profoundly lucrative market. The broad communications and web-based social networking infiltration, the young are getting to fashion conscious. This has opened uncommon doors for the retail showcase.

Market specialists say it is exceptionally hard to evaluate the extent of fake attire. There are numerous manufacturing plants situated at non-descript areas associated with fake items. A large number of them deliver duplicates of multinational brands as edges are high. The movement tricks shoppers as well as the state exchequer. As per insiders, Delhi is the centre of fake items as about 70% fake items start from the national capital.

It’s not a surprise that we usually see cheap grade apparels at different market locations and street shops. As per trade reports, apparels are the second most counterfeited products after footwear across the world. According to Global Brand Counterfeiting Report 2018, “The amount of total counterfeiting globally has reached to 1.2 Trillion USD.”

Apparels are one of most counterfeited products and counterfeiters have copied many famous and costly brands. It is usually difficult to recognise counterfeit apparels at one glance. Some of the best ways through which counterfeit apparels can be determined are its quality of the fabric, stitching, quality of packaging, discrepancies in tags and labels.

Counterfeit apparels can only be stopped with unified efforts of the manufacturers, retailers and consumers at large. Many big brands are using different anti-counterfeiting measures to prevent counterfeiting of their products. This will certainly help them in safeguarding their brand image and prevent further loss.

The ill-effects of counterfeiting on the auto-component industry

For the past few decades, there has been an unprecedented rise of counterfeit automotive parts in the automotive industry. The trend not just jeopardizes the health of the consumers but also brings down the growth of the manufacturers. Of late, authorities from across the world have seized huge amount of counterfeit automotive parts at different stages of the supply chain.

A large amount of such counterfeit automotive parts, confiscated by officials, are from China. In the last few years, the trade of counterfeit auto parts has jolted the automotive manufacturers across the world.

According to a report by FICCI on Illicit Trade, “The Indian auto component industry suffered a loss of INR10501 crores in 2014 due to grey market which increased from INR 9198 crores in 2012.”

Market experts cite various reasons behind the growth of counterfeiting in the automotive industry which include, ease of manufacturing, packaging and import of products, higher margins on the sale of counterfeit automotive parts, uninformed customers buying counterfeit automotive parts, availability of technology to copy products, lower cost of duplicate product and short replacement cycle of some products.

Due to the above-mentioned reasons there has been an exponential growth in counterfeiting of automotive parts and has deeply troubled the automotive industry, government and last but not least consumers. Let’s discuss these impacts in detail:

Impact on manufactures: Automotive manufacturers have to bear the brunt of counterfeiting. The sale of counterfeit automotive parts brings down the sale of genuine products drastically. Moreover, there is a loss to the image of the manufacturers due to faulty and poor-quality cheap products.

Impact on government: The Indian government lost INR 3113 crores in the year 2014 compared to INR 2726 crores in the year 2012. The government suffers a huge amount of losses due to evasion of taxes by forgers or counterfeiters.

Impact on consumers: Did you know that 20% of traffic accidents are caused by counterfeit automotive parts? The figure was revealed by Automotive Component Manufacturers Association (ACMA) a few years ago. So the most diabolic impact of counterfeit automotive parts is that it plays with the life of consumers.

The growth of anti-counterfeiting technology market

There has been a rapid growth of counterfeiting or duplication in different industries across the world. From medicines to food items, consumer electronics to apparels, footwear to FMCG products and much more has been encircled by the menace of counterfeiting.

As per the Global Brand Counterfeiting Report 2018, 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 which includes counterfeiting of all equipment/products from defence equipment’s to counterfeiting of watches.”

According to the report, “Losses incurred by Luxury Brands because of sale of counterfeiting through internet accounted for 30.3 Billion USD.” The above-stated figures present a grim picture of global business which is suffering from the pandemic called counterfeiting.

However, at the same time in order to protect their products and supply chains from counterfeiting, industries are using different kinds of anti-counterfeiting technologies. As per ISO 12931, all the anti-counterfeiting technologies can be categorized into overt, covert, forensic and digital.

Different types of anti-counterfeiting technologies are being used as per their requirements in different industries. The implementation of these technologies have reaped many benefits which in turn, popularized their application. According to a report by Markets and Markets, the Anti-Counterfeiting Packaging Market will reach a staggering $128.6 billion by 2019.

Here are the four important reasons which are responsible for the growth of anti-counterfeiting technologies.

  1. These technologies significantly reduce the incidents related to counterfeiting, adulteration and tampering and thus help in saving company profits.
  2. With the implementation of anti-counterfeiting technologies, brands can strengthen their image among consumers.
  3. Anti-counterfeiting technologies not just helps in securing the products but, also helps in safeguarding and monitoring of the supply chains.
  4. Anti-counterfeiting technologies also prevent IP infringement or violations.

Hot stamping: A revolutionary printing method against counterfeiting

Hot stamping is a revolutionary printing method which is environment-friendly, easy to implement, durable and can include a variety of colours and processes. The printing method has diversified, since its rise to popularity in the 19th century. Post 70s, hot stamping became one of the most popular printing technologies used on plastic products. Once majorly used for only plastic products, hot stamping is now being used for electronic components, cosmetic items, automobile parts to name a few.

Hot stamping involves a process in which a part of the object is efficiently marked with the foil. The hot stamping foil can endure harsh conditions of nature like pressure, temperature, scratches etc. Now, let’s understand the process of hot stamping.

  • In a hot stamping machine, a die is mounted and heated.
  • The product which needs to be stamped is placed beneath the die.
  • A painted roll leaf carrier is inserted between the die and the product.
  • The die presses down through it.
  • The dry paint or foil is impressed onto the surface of the product.

The hot stamping process is easy to apply to the product and packaging.  It is also economical, environment-friendly and secures the product from counterfeiting. Being one of the largest hot stamping foil manufacturers in India Holostik takes advantage of being the leader of the anti-counterfeiting industry in India. We are not only serving our clients in more than 14 different industries but also helping them to choose from different variants of HSF or hot stamping foil.

What are the effects of counterfeiting on the alcohol & beverages industry?

At the start of this year, two ill-fated hooch tragedies in the states of Uttarakhand, UP and Assam took more than 200 lives and shocked the entire nation. A big question was raised on the regulatory framework of the states’ excise departments and the government machinery. However, hooch tragedies have been happening in India for the past so many years.

Here are the number of people who died due to counterfeit and adulterated liquor in the last 10 years.

Year State No. of deaths
2009 Gujarat 136
2011 West Bengal 172
2015 Mumbai 102
2016 Bihar 13
2019 UP & Uttarakhand 99
2019 Assam 114

The disturbing figures

According to Illicit Markets- A threat to our National Interests published by FICCI and Thought Arbitrage Research Institute in 2015, the grey market loss to the alcoholic beverage industry stood at INR 14,140 crore in 2014 which had increased from INR 5,626 crore in 2012.  This resulted in a huge tax loss to the government with an estimated revenue of INR 6,309 crore.

The figures are quite disturbing and have a direct impact on the alcohol and beverages industry in many ways. Let’s discuss them one by one.

Effects of counterfeiting on the alcohol and beverage industry

  1. Loss of tax revenue: Counterfeiters or forgers use different channels or means to sell illicit liquor which leads to evasion of taxes meant to collected by state and central governments.
  2. Promotes criminal activities: No wonder, the sale of counterfeit alcohol directly or indirectly benefits criminals and crime syndicates who use the profits incurred from it on other crimes.
  3. Loss of brand image: The sale of counterfeit or spurious alcohol tarnishes the image of the company and its products.
  4. Loss of consumers: One of the biggest threats of counterfeit alcohol is its effect on the health of the consumers. Besides serious conditions like liver or kidney failure, counterfeit alcohol can also take away their precious life.

The solution

One of the best solutions against illicit liquor is the use of tax stamps which include both physical and digital security features. For example, tax stamps must include bar codes or QR codes along with a hologram for enhanced two-step security. This helps in checking the counterfeiting of liquor to a large extent as fraudulent are not able to copy the holographic features with ease. Moreover, the digital security feature also helps in tracking the product in the supply chain along with a host of other IT-enabled supply chain management features.