Counterfeiting sure is a big business but is it worth it?

As per the International Anti-Counterfeiting Coalition Counterfeiting is a federal and state crime, involving the manufacturing or distribution of goods under someone else's name, and without their permission. Fake merchandise are usually produced using lower quality segments, trying to offer a shoddy impersonation of comparative products delivered by brands customers know and trust. Fake products range over various commercial ventures including everything from clothing, accessories, music, programming, meds and cigarettes, to vehicles and plane parts, purchaser merchandise, toys and gadgets.

In a country like India where fakes are produced more than originals at times, Counterfeiting is a big business. Counterfeiting is emerging as a global issue and the main reason for this increase is the increasing demand of such products since consumer desire products at a cheaper price range. Counterfeiting is not limited to a single industry, it has extended across categories from faking products like luxury handbags, shoes to even medicines. While there are pros and cons for almost everything, however counterfeiting has only negatives associated with it. Counterfeiting is illegal, it costs a lot to companies, it is an organized form of crime and it adversely affects the legitimate companies. For many corporations, intangible assets like brands and trademarks are even more valuable than tangible assets, therefore, addressing this issue of counterfeiting is a major concern for many organizations and brands today.

Talking about the detrimental consequences of this problem, it not only causes a monitory loss to brands and businesses but also poses a threat to the life of the people at large. For example counterfeiting a handbag might not be of the same impact as counterfeiting a medicine would be. A fake medicine can harm the health and lives of many innocents while benefiting the counterfeiters. By falsifying an organization's products, the forger turns into a contender of that true blue organization. Subsequently, that organization loses deals and market share. Forgers likewise wear down the value of the original brand. As a result low-quality, modest fakes surge the business sector, and clients are misdirected by false products. This further results to a decline in the market price of a particular brand considerably. Businesses who face counterfeiting may also suffer losses in the form of legal obligations, since their products with the same brand identity are being forged and supplied to customers with cheaper quality and prices. Further counterfeiting harms not only a particular organization or individual consumers but also the country and its economy as a whole. Brands lose their faithful customers and face heavy losses due this problem of fake goods being produced at the name of originals. 

To deal with these critical issues of counterfeiting there are many solutions available in the market today and try to make their product counterfeit proof. The solutions include Security Holograms, Holographic Strips, Holographic Paper Labels, Holographic Board, 3D Promotional Stickers, Holographic Tax Stamp, Mirror Effect Holograms and many more.

About Rs 39,000-crore loss was faced by various organizations collectively in one year due to illicit markets in the manufacturing sectors according to a FICCI report for the Year 2015. This report included seven sectors such as Alcoholic beverages, Auto Components, Computer Hardware, FMCG - packed foods, FMCG – personal goods, mobile phones and Tobacco. FMCG, packaged foods, tobacco, alcohol and mobile phones alone had led to a loss to the nation to of around Rs 32,239 crore during 2014 according to the report. Further, barring packaged foods, all industry sectors have shown an increase in grey market percentages, the largest being in the alcoholic beverages sector with an increase of 63.7%. The largest increase in the amount of loss was seen in the alcoholic beverages and mobile phones industries, where losses have risen by 151% and 111% respectively. As a result not only individuals and organizations but the government witnessed a total loss of Rs. industries 39,239 crores in 2014, up from ' 26,190 crores in 2012 on account of the illicit markets in India.

This article is written by U.K. Gupta, CMD, Holostik Group.