The problem of counterfeit goods is rising on Amazon, says AAFA

In a letter addressed to United States Trade Representative, American Apparel and Footwear Association (AAFA)- the trade group comprising of more than 1000 brands across the fashion industry wrote about the growing concern of counterfeiting on Amazon. Last year, AAFA had recommended adding Amazon websites in Canada, Germany and the United Kingdom to the list of notorious markets. Now the association is asking to include Amazon marketplaces in France and India to the same list.

AAFA identified around eight online markets as well as 130 physical stores involved in the sale of counterfeit goods. “Despite its role as a leader in the worldwide retail landscape, and as an important selling partner for many of our member brands, Amazon continues to present significant counterfeit challenges,” said AAFA president and CEO Rick Helfenbein.

“While we are happy to have seen increased engagement with Amazon on brand protection issues during the past year,” he added, “that engagement regrettably has not translated into a discernible decrease in counterfeits of our members’ products on Amazon’s marketplaces.”

The e-commerce giant has been facing accusations due to the sale of counterfeit products. With its expansion, Amazon has been increasingly reliant on third-party sellers to meet the increasing demand. However, the Seattle based company lacks full control over the third-party sellers which leads to the sale of counterfeit products.

In the past few months, Amazon has clamped down on fake products with the launch of Project Zero. The anti-counterfeit initiative uses an automated scanning tool and product serialization service, which helps to verify the authenticity of a purchase. Earlier in July, a federal appeals court ruled that Amazon can be held accountable for defective goods sold on its website by third-party merchants.

Source: Footwearnews.com

How does counterfeiting affects the economy?

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.

The menace of counterfeiting has reached a global value of trillions of dollars. Counterfeit products are not just posing a threat to the legitimate manufacturers but also to consumers. We often come across news reports from different parts of the world where consumers have been badly affected by fake products.

As per a joint report by OECD and EUIPO, “Global sales of fake and pirated goods have soared to 460 billion euros ($522 billion) a year, amounting to a whopping 3.3 percent 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.

According to ASPA the value of counterfeiting in India has reached one lakh crore annually and is causing big trouble to the national economy.

Let’s discuss some of the negative impacts of counterfeiting on the economy of the country.

  • Evasion of taxes: The growing counterfeit products industry thrive in the market without paying taxes to the government. Unlike genuine manufacturers, they evade taxes that are necessary for the government exchequer. This prevents the government to sufficiently spend on welfare projects and schemes.
  • Rise in unemployment: Counterfeit products cause monetary losses to the manufacturers. Due to the slowdown, 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 fake products.
  • 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.
  • Promotes 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 drug 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@holostik.com.

The challenges faced by manufacturers due to counterfeiting

There has been a sharp rise in the number of fake products across the globe. Counterfeiting is impacting consumers, manufacturers and governments. Almost every industry is affected by the problem of duplication. According to a joint report by KPMG and FICCI the counterfeiting business us going to become $1.90 -$2.81 trillion industry by 2022.

Organizations are trying their level best to counter the threat of duplication. The added costs in fighting fakes comes as an extra burden. Besides the company facing duplication has to deal with poor brand image which often takes years to build.

Let’s discuss some of the negative impacts of counterfeiting on manufacturers:

Loss of sales revenue and profit margins: No wonder, a good amount of sales is synonymous with the growth of the company. The sale of duplicate items leads to a drop-down in the sale of a company’s products. If it goes unchecked, then it can lead to a complete downfall of the company. Due to multiple sale locations of the product, it is quite hard for a company to trace the manufacturing location of counterfeits.

Poor brand and product image: No wonder, the sale of counterfeits lead to a tarnished image of the brand and its products. The sale cheap fakes lead to a false perception among consumers regarding the quality of the product and the brand. Unaware consumers often think that they are buying original products but instead, they receive fakes.

Added cost on fighting fakes: Companies have to incorporate different strategies for fighting counterfeiting of their products. This comes in the form of added costs for the organization already facing the problem of duplication.

Counterfeiting causes losses worth billions of dollars to the global economy. However, with the help anti-counterfeiting solutions manufacturers can fight the menace of duplicate products. Holostik is an industry leader in providing the best anti-counterfeiting solutions as per the client’s needs.

One lakh crore lost annually in India due to counterfeit products- ASPA

According to a new report by ASPA (Authentication Solution Providers’ Association), India suffers a loss of over one lakh crore Rupees per annum due to sale and purchase of fake goods by consumers from all sectors.

Nakul Pasricha, President ASPA said, “Counterfeiting is most prevalent in the pharmaceutical industry.” Mr. Pasricha has also urged the government to take adequate steps to mitigate such risks. He stressed on the need for proper implementation of authentication solutions, enforcement, awareness and monitoring which will reduce counterfeiting in Indian by 50% which would save around fifty thousand crore rupees per annum.

While quoting from a report of OECD (Organisation for Economic Co-operation and Development), Mr. Pasricha said that in India trade of counterfeit goods has increased steadily in the last few years whereas globally the volume in fake products now stands at 3.3% of the total global trade which causes a massive loss to brand owners in terms of revenue.

ASPA’s President also discussed about different technologies available against counterfeiters which include anti-tampering, tracking and tracing. He gave an example of Nigeria where the adoption of physical and digital authentication solutions has reduced the rate of counterfeiting from approximately 20% to 3.5% in the Pharma sector in three years.

He cited the high return of investment and positive impact of anti-counterfeit solutions around the world, Mr. Pasricha expressed confidence that India too will be on the road to adopt authentication technology.

Source: Lexology.com

Reports & Data: Anti-counterfeit packaging market to reach USD 248.90 Billion by 2026

According to Reports & Data, the global anti-counterfeit packaging market is forecasted to reach a value of USD 248.90 billion by 2026. As per the report, the massive rise in globalization has increased the level of counterfeiting across the globe. Duplicate goods include jewellery, electronic items, apparels, medicines, tobacco products, liquor and much more. Due to this trend, secure packaging is witnessing high demand among different industries.

Anti-counterfeit packaging involves the action of assigning secure packaging to the product so as to minimize the incidents of counterfeiting and infringement. Currently, the market of fake products is growing across the globe at an alarming rate and manufacturers are finding it harder to counter the threat. Among the many sectors pharmaceutical is one of the worst-hit by counterfeits. Fake medicines include the proliferation of dangerous and illegal substance used in counterfeit drugs.

Organizations are using different anti-duplication packaging to counter the imitation and confirm the safety of items. Counterfeiting leads to a reduction in profits and loss in the brand image for the affected company.

In the year 2018, North America had the largest share at 31.4% in the anti-counterfeit packaging market. The report states that the high demand from healthcare products, electronics, food and beverages, and cosmetics is pushing the growth in this market. Moreover, awareness among consumers is leading to an increase in the demand for transparency which in turn is boosting traceability of the products. In order to cater to the rising demand, manufacturers are coming up with innovative technologies in equipment with specific functionalities for efficient identification and tracking of products.

Other key findings of the report:

  • Barcodes held the largest market share of 21.8% in the year 2018. The barcode is a series of numbers which, when decoded, identifies the product by date and place of manufacture. These codes are one-dimensional, and the information included in them is limited by the maximum available number of characters that can be scanned or printed at a time.
  • Overt Feature is forecasted to grow with the higher CAGR of 10.9% during the forecast period. This feature enables instant authentication of packaging via visual inspection by a layman. An optically variable feature like holographic devices within designs and color shift links are some of the most common and effective overt security features.
  • Counterfeit medicines in pharmaceutical are among the most lucrative sectors of the global trade. Fake drugs kill or harm millions across the globe and inflict some severe damage to the brand names of big pharmaceutical manufacturers. Lifesaving drugs are also included from the trade-in fake medicines. Healthcare & Pharmaceutical held the largest market share of 24.6% in the year 2018.
  • The Asia Pacific region is forecasted to grow with the highest CAGR of 10.7% during the forecast period, owing to the development of the anti-counterfeit packaging market in China and India. Increasing awareness among consumers has led consumers to check the product-related information before purchasing products, in turn, increasing the demand for anti-counterfeit packaging in this region.

Source: www.globenewswire.com

The growing menace of fake products in the e-commerce industry

The e-commerce industry in India is facing the menace of counterfeiting. According to Local Circles, a community media platform, one in five products sold on e-commerce websites in India is fake. Another survey by market research firm Velocity MR has revealed that every one out of three online shoppers has received a fake product. However, that’s just a minor revelation and the problem is much bigger. In the present times when your favourite products are just a click away the incidents of counterfeiting have increased rapidly.

Counterfeits pose a risk to the manufacturer, e-commerce players and end-consumers. According to a reputed media house, fake products are risky for the investors and government exchequer. Fake goods don’t just impact genuine brands and investors but also the customers. A fake cosmetic can ruin the skin, a counterfeit toy can be dangerous for a child or a fancy looking apparel may cause skin allergy the list seems endless.

In order to the fight the scourge of fake products in the e-commerce industry, the Indian government has issued a draft national e-commerce policy which aims at regulating cross border data flow, prevents piracy and counterfeiting and requires all online sellers to register their business locally.

E-Commerce giants like Amazon and Alibaba have also implemented different regulatory measures for curbing the sale of counterfeits on their platforms. In a blog post, Amazon has stated, “Brands provide us with their logos, trademarks, and other key data and we can scan over 5 billion product listing updates every day, looking for suspected counterfeits.”

Product tracking, digital authentication, serialization and holography can also play an important role in preventing counterfeits and any form of tampering. A recent example is the rampant use of QR enabled holographic labels or holograms by which help in authenticating the genuineness of the product instantly.

Many e-commerce companies are also using anti-tamper packaging labels and holograms to prevent tampering and duplication. Anti-counterfeiting mechanisms have become necessary today for e-commerce companies and manufacturers in order to clamp down on counterfeiting and prevent any possible loss. In case you are willing to secure your products from counterfeiting, tampering and diversion call us on +91–785-785-7000 or drop a mail at connect@holostik.com.

Pashmina products to get BIS certification against counterfeiting

In a recent development in Leh, Ladakh the Bureau of Indian Standards (BIS) has released a domestic standard for identification, marking and labeling of Pashmina products – to certify their purity.

“The move will help to prevent the counterfeiting of Pashmina products and will protect the interests of artisans and nomads who are responsible for the production of raw materials and textiles”, said Smriti Irani, Minister of Textiles.

The step will help in determining better prices for the goat-herding community in Ladakh and handloom artisans producing authentic Pashmina items which are at a disadvantage due to lot of poor marketing practices, as per an official release.

Currently, around 2,400 families are rearing 2.5 lakh Pashmina goats which are domesticated and reared by nomadic communities called the Changpa in the Changthang region of Greater Ladakh. Around 50 metric tonnes of finest grade Pashmina (12-15 microns) is produced in Ladakh.

The Ministry of Textiles is developing a proposal for funding ₹20 crore for a dehairing plant in Leh that will lead to the progress of the Pashmina sector in the region of Ladakh.

Source: fibre2fashion

Fake health supplements: Doing more harm than good!

Almost two decades back people in India were not at all bothered about health, but now things have changed drastically. The popular health culture of the West, the obsession to look good and intense competition has created a general awareness regarding health and nutrition.

This has led to a spur in the demand for health and nutrition-based supplements in India.  According to market reports, “The dietary supplements market in India is expected to grow at a CAGR of 20% from 2015 to 2023. Vitamins and minerals occupy a larger share of the pie in the Indian dietary supplements market – 40% – followed by the herbal segment contributing 30%, proteins segment contributing 25% and other segments contributing around 5% of the total market.”

Despite the enormous growth, the health & nutrition supplement industry is facing the issue of fake and spurious products. The number of fake supplements is increasing. The idea of building iron physique by consuming cheap protein and vitamin supplements has ruined the health of many consumers. There are numerous media reports on the growing industry of fake supplements. As per a joint report by ASSOCHAM & RNCOS around 60-70 % of health supplements sold in India are fake.

ASSOCHAM predicts that the market for dietary supplements will increase to $4 billion by 2020. With this massive growth in perspective, counterfeiters will speed up their illicit activities of manufacturing and selling fake supplements in the market.

The problem of fake supplements is not just limited to India but is also affecting countries in the West. Recently, the global retail giant Amazon issued warning notices to its consumers regarding the fake supplements which they had bought online.

Health supplement manufacturers can play a pivotal role in curbing the menace of fake health supplements. They can use different kinds of anti-counterfeiting products and solutions which help in product authentication and tracking & tracing the product supply chain. Effective and timely use of anti-counterfeiting solutions can prevent the likelihood of counterfeiting, tampering and diversion. The diligent move benefits both the manufacturers and consumers in the long run.

If you are into the manufacturing or import of dietary supplements, then you can get the best anti-counterfeiting products & solutions from us, which will be customised as per your needs. Call us on +91–785-785-7000 or mail us at connect@holostik.com.

Jindal Stainless Limited takes action against counterfeit products

In order to curb the counterfeit products of Jindal Stainless Limited (JSL), the company has launched a nationwide co-branding initiative along with the pipes and tubes manufacturers. Jindal Stainless is one of the leading players in the steel market and looks forward to increasing its revenue in the coming years. According to industry experts, the current market size of decorative P&T segment is around INR  5200 crores.

Speaking on the issue of counterfeiting Mr. Abhyuday Jindal, MD, JSL said, “We have launched this mutually beneficial co-branding scheme in response to the needs of our customers. It is estimated that over 25% of pipes and tubes sold annually in India bear the counterfeit branding of Jindal Stainless Limited. We aim to curtail this counterfeiting and capture the growing decorative P&T market in the next 2 years.”

JSL co-branding move will help its MoU partners to make a clear distinction from the products of other P&T manufacturers. For this, JSL has created standardized seals for the products which include logos of the MoU partner & JSL, the grade of stainless steel & MoU number. The genuineness of the product can be checked with the help of the unique MoU number on the company’s website.

The co-branding initiative will offer enhanced visibility and penetration in the market for the company’s partners who were earlier struggling from the effects of counterfeiting. It will also ensure that only the right products reach to the consumers.

The stainless-steel grades used in the decorative P&T segment are 304, JT, J4 and JSLUSD. They offer higher strength, lower lifecycle cost, unmatched aesthetic appeal, low maintenance requirement, along with the advantage of being nearly 100% recyclable. These grades are also corrosion-resistant and ensure durability.

Source: Steelguru.com

Amazon launches transparency service against counterfeit products

In a recent move, the online retail giant Amazon has extended its transparency service in India to clamp down on counterfeit products on its platform. This positive initiative will bring much-needed relief for online consumers who are at the risk of receiving fake products.

Transparency service is a product serialization service that provides a unique barcode for brands to apply to every unit they manufacture. This helps the manufacturers to prevent counterfeits throughout the supply chain. This helps to protect both brands and customers from counterfeiting.

As per the official press release of Amazon, Transparency service is being extended to countries like France, Germany, Italy, Spain, UK, India and Canada. The geographic expansion builds on over 4000 brands that have registered with the Transparency in the US and have generated more than 300 million unique codes.

To execute the process Amazon scans and verifies the unique serialization code to ensure that only genuine units reach the customers. Moreover, it also enables the consumers to use the mobile app to scan the code and verify the genuineness of the purchased items.

The announcement of Transparency service comes after an order of a federal court of Philadelphia which stated that Amazon can be held responsible for defective products sold by its marketplace vendors.

While speaking on Amazon’s new service Dharmesh Mehta, Vice President of Amazon Customer Trust said, “We created Transparency to provide brands with a simple, scalable solution that empowers brands and Amazon to authenticate products within the supply chain, stopping counterfeit before it reaches a customer.”

Source: Zeebusiness.com