Effective Measures to Counter Product Counterfeiting

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If statistics are to be believed then counterfeiting is a 600 billion dollar problem. It is such a big and successful business that in the past two decades, its growth has been over 10,000 percent.

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Effective Measures to Counter Product Counterfeiting

  1. 1. Effective Measures to Counter Product CounterfeitingIf statistics are to be believed then counterfeiting is a 600 billion dollar problem. It is such a big andsuccessful business that in the past two decades, its growth has been over 10,000 percent. Hence, theFederal Bureau of Investigation (FBI) has termed product counterfeiting as the crime of the 21stcentury. Though many people disagree, the fact of the matter is consumers have played a significantrole in the growth of product counterfeiting. Cheap prices and easy availability are the two importantfactors that induce people to go for counterfeits. However, by doing so they are indirectly being partof nefarious activities like organized crime, drug trafficking, terrorist activity and so on. Besides that,they contribute to unemployment, child labor, budget deficits and compromising the future of thecountry that they live in. Here is a look at some facts to understand the necessity of anticounterfeiting solutions. ● Since 1982, the global trade in illegitimate goods has increased from $5.5 billion to approximately $600 billion annually. ● Counterfeiting costs U.S. businesses $200 billion to $250 billion annually. ● U.S. companies suffer $9 billion in trade losses due to international copyright piracy. ● Counterfeit merchandise is directly responsible for the loss of more than 750,000 American jobs. ● Approximately 5%-7% of the world trade is in counterfeit goods. ● Counterfeiting poses a threat to global health and safety.In 2012, the Department of Homeland Security and its agencies, Customs & Border Protection (CBP)and Immigration & Customs Enforcement (ICE) carried out 22, 848 seizures and the MSRP(Manufacturer’s Suggested Retail Price) of the seized goods was $1.26 billion. However, it’s just thetip of the iceberg. Though it’s difficult to nip the problem of counterfeiting in the bud, original
  2. 2. product manufacturers (OPMs) can put in place effective countermeasures to reduce its market’s sizeand scope. Here are some of them. ● OPMs must partner with dealers, customers and customs officials to shut down the violators. Educate customers and dealers about counterfeit products and ways to identify it. ● Starting a reward system for dealers who report counterfeit products is also a good move. ● Since a great part of counterfeiting is done online, OPMs must deploy enterprise risk management solutions to monitor activity for any number of products globally. It picks up pricing, discount percentages, quantities for each product and provides the data in user configurable charts. As it quickly identifies the companies that are causing loss of revenue, brand erosion and customer dissatisfaction, OPMs can quickly reduce the impact of product counterfeiting on them.With counterfeiting being the greatest menace faced by enterprises and customers alike, effectivemeasures in tune with those suggested above becomes highly imperative.Read More About: brand management, gray market, Anti-Counterfeiting

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