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.

The growth of counterfeiting in the liquor industry

The entire nation was jolted by the ill-fated deaths of people due to counterfeit alcohol in the first half of this year. Not just precious lives were lost but families were left devastated in the states of UP, Uttarakhand, and Assam. The onus of the tragedy fell upon the respective State Governments and a debate ushered in the by lanes of media and forums on the present regulatory and anti-counterfeiting measures against fake and illicit alcohol in the country.

According to a study published in the journal Lancet, India’s alcohol consumption has increased by 38% in the last seven years-that’s 4.3 to 5.9 litres per adult per year. Another study states that India is the biggest consumer of whisky in the world. However, the rising demand for alcohol has led to the growth of spurious alcohol industry.

There have been frequent reports of seizures of counterfeit and bootleg alcohol from different states of India. According to a report by FICCI, “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 observing an increase of over 150 per cent.”

There are various reasons for the growth of counterfeiting in the alcohol industry. Lack of awareness regarding the effects of counterfeit alcohol is one big reason. The poor consumer is lured by the cheap prices of counterfeit alcohol and thus ends up buying counterfeit alcohol which may contain toxic adulterants. These adulterants lead to serious repercussions like kidney failure, liver failure, blindness, and even death.

The government must address the problem of counterfeit alcohol seriously as it hampers the growth of manufacturers, leads to a loss of Government exchequer and jeopardizes the health of the consumers. The combination of digital and holographic solutions can prevent the growth of counterfeit alcohol to a large extent. The U.P state government is currently using bar codes which have not been completely successful in clamping down on counterfeits, therefore, authentication solution providers association (ASPA) has suggested governments to incorporate holographic products along with bar codes/QR codes on liquor bottles to battle the menace of duplication in the liquor industry.

Do let us know if your brand or product is facing duplication. We offer tailormade anti-counterfeiting products and solutions. Call us on +91–785-785-7000 or mail us at connect@holostik.com

Global counterfeiting has grown 100 times-FICCI CASCADE

FICCI CASCADE (Committee Against Smuggling and Counterfeiting Activities Destroying the Economy) has raised a serious concern on counterfeiting and smuggling. The body believes that the global economy has suffered massive financial loss due to counterfeiting and there has been an increase in its volume by 100 times.

The experts from FICCI CASCADE while speaking at a seminar highlighted the importance of increased awareness on the hazards of counterfeiting and smuggling, and the need for effective enforcement to enhance India’s economic development.

PC Jha, Advisor, FICCI CASCADE and Former Chairman, Central Board of Excise and Customs, stated that during the last twenty years, the volume of duplication has increased 100 times around the world and the size of the trade in duplicate goods is 10 percent of the legal international trade. He finally stressed on the seriousness of the problem of illicit trade.

Deep Chand, Advisor, FICCI CASCADE and Former Special Commissioner of Delhi Police emphasized on the need for consumers being continuously made aware of the detrimental impact of illicit products. He further said, “Consumer awareness campaigns that explain how to differentiate a spurious product from a genuine product to demanding a copy of the bill from the seller, along with the harmful consequences of purchasing illegal products.

As per the FICCI CASCADE report published in 2015, the total loss to the government on account of illicit markets in just seven manufacturing sectors is Rs 39,239 crores. Amongst the various sectors, the maximum revenue loss to the exchequer is attributed to tobacco products. Estimating a revenue loss of Rs 9139 crores, followed by mobile phones at Rs 6705 crores and alcoholic beverages at Rs 6309 crores.

According to a FICCI report, ‘Illicit Trade: Fuelling Terror Financing and Organized Crime’, counterfeiting is the second largest source of income for criminal activities. The global loss to employment would stand at 4.2 to 5.4 million in the year 2022.

Source: uniindia.com

FICCI CASCADE organizes seminar on the problem of counterfeiting & smuggling

FICCI CASCADE the anti-smuggling and anti-counterfeiting arm of the industry body FICCI recently organized a seminar on ‘Combating Counterfeiting and Smuggling, an Imperative to Accelerate Economic Development’ in the city of Bhopal.

Counterfeiting is a growing problem and can be effectively countered with appropriate policies said experts present at the seminar. The experts discussed the urgent need for awareness on the hazards of duplication and smuggling. They also raised concerns on the level of enforcement of anti-counterfeiting policies for the overall growth of the country.

Justice (retired) N.K Jain, Judge of MP High Court and Chairman, Madhya Pradesh State Consumer Redressal Commission praised and encouraged FICCI CASCADE’s dedication to eradicate smuggling and illicit trade in the country. Besides this, he also mentioned that a lot more is required to change the outlook of the common man with regard to the use of counterfeit and smuggled goods. Counterfeiting and smuggling of goods not just block the economic growth of a country but is equally detrimental to the health and society. He further commented on the need for strict regulations and effective implementation of the same to curtail the problem.

Anuradha Sharma, Additional Director General, Madhya Pradesh Police stated that counterfeiting and smuggling is an important issue and negatively impacts the health and safety of the common man. This has also led to tax and revenue losses of the industry. The issue is highly critical and needs a collaborative action from all stakeholders.

According to a report released by FICCI CASCADE in 2015, the overall loss to the government on account of illegal markets in seven manufacturing sectors is Rs 39,239 crores.

Source: Daily Pioneer

Fake Tobacco

Exchequer Incurs Huge Losses Owing to Counterfeit Tobacco – FICCI Report

According to a recent study released by FICCI, the illicit trade related to tobacco has led to a loss of Rs. 9,139 crore to the exchequer. Several other losses due to illicit trade of mobile phones at Rs. 6,705 crore and alcoholic beverages at Rs. 6,309 crore have also been bored by the exchequer. Continue reading “Exchequer Incurs Huge Losses Owing to Counterfeit Tobacco – FICCI Report”

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Tamil Nadu minister accuses private players for selling adulterated milk

A recent statement by Rajendra Balaji, Dairy Products Minister, Tamil Nadu has left the private players of Tamil Nadu milk industry completely stormed. He has strongly accused private firms for mixing harmful chemicals in milk which is responsible for causing cancer amongst the children.
Continue reading “Tamil Nadu minister accuses private players for selling adulterated milk”