Top 5 reasons why counterfeit goods are getting harder to spot

By Gary Addison
June 26, 2018

From clothing, handbags, and sunglasses, through to medicine, electrical goods, tobacco, and even food, it seems that nothing is beyond falling victim to counterfeiters. The appetite for fake products around the world is voracious, and is now estimated to make up 2.5 per cent of all international trade. Counterfeiting can sometimes be seen as a victimless crime where the only ones losing out are the super-rich corporations whose products are being copied. This is simply not true.

Counterfeiters target two very distinct markets with their products – those who are actively seeking out cheap, but convincing, replicas of desirable designer goods, and those who are being deceived and are inadvertently buying fake products under the belief that they are the genuine article. It is this second group of people in particular that need to be protected. It is one thing knowingly purchasing an imitation designer handbag; however, much more dangerous is dubiously manufactured medicine being passed off as the real deal to unwitting consumers. The same goes for electrical products which could have devastating effects on the health and welfare of the public should the quality fall below industry standards.

So what is behind this explosion of counterfeited products, and is it likely that this underground marketplace will continue to expand?

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Let’s take designer clothes and accessories, by far the most counterfeited class of products, as an example. For a society in love with disposable throwaway fashion, paying more for superior quality is not always high up on the agenda of would-be purchasers. However, despite the reluctance to splash out on these products, the desire to be seen in possession of designer labels remains, making this a dream landscape in which counterfeiters to operate in.

As people have moved away from investing in key items for their wardrobes and instead opt for low-cost fast-fashion which can be regularly updated, the market for fake designer goods has expanded.

When people are buying clothing as a prop for an Instagram post, paying more is not desirable as quite often the product is not bought with the long-term in mind. Subsequently an increasingly number of consumers are taking the decision to pay substantially less for a knock-off designer handbag every couple of years, rather than investing in one genuine higher quality item which could potentially last decades. What is the point of spending potentially thousands of pounds on a quality item which may last years if it is going to be seen as dated long before it falls apart?

Perhaps as a result of this desire to marry the cachet of designer brands with the convenience of affordable fashion, the stigma which was once attached to buying fake goods has all but gone. This only makes the market more desirable for potential customers who may not have considered buying cheaper imitations a few years ago.

Although changing consumer attitudes are partly to blame, there is more to consider here. A big reason for the increase in counterfeit goods is that quite simply, that they are getting harder and harder to spot, both by consumers and also by the authorities. Here are 5 key reasons why this is the case:

  1. Increased quality – Counterfeit is no longer a code word for poor quality. In fact counterfeit products are increasingly manufactured in the same factories and using the same raw materials as their genuine counterparts. However, these products will have a fake label and serial number attached to them before leaving the factory through the back door.
  2. Production moving abroad – The vast majority of counterfeited items originate in China, India, and Turkey. It therefore comes as very little surprise that as fashion houses and electronics companies increasingly move their production to Asia in an effort to cut costs, the level of fake products originating from these factories is also on the rise. Less rigorous governance of what is coming in and out of these factories, coupled with more sophisticated production methods are a perfect combination for fraudsters wanting to take advantage of the growing demand for counterfeit goods.
  3. The role of the internet – The explosion of e-commerce has made it simpler not only for counterfeiters to avoid detection, but also for would-be customers to obtain these goods. Essentially it has never been easier to sell or easier to buy. Anyone can open an online selling platform, and can just as quickly close it down to avoid exposure should they believe the authorities are growing suspicious. Not only can personal identities can be hidden, but customers can easily be fooled regarding the location the product is being shipped from. Additionally, selling online rather than face-to-face makes it much easier to deceive customers when it comes to the quality (or even the exact item) of what is being sold. Defects in manufacturing quality can be hidden by using flattering photography techniques, or alternatively an image of a genuine product can simply be used to illustrate the product.
  4. Improvements in packaging – It is not just the quality and look of the products which has improved, counterfeiters are now increasingly concerned with copying everything from the packaging, through to the label sewn in to a garment, making the products more and more difficult to differentiate from the genuine article. Fake goods are being sent in containers deliberately made to deceive customs officials attempting to spot and seize counterfeit products as enter the country. The smarter counterfeiters get, the more difficult it is getting for the authorities to spot these products resulting in more and more slipping through the net and entering the supply chain.
  5. Counterfeits are going unreported – The increase in quality of the products and the attention to detail put in to pass these goods off as genuine not only makes the items difficult for authorities to tell apart from authentic products, but it also means customers are much less likely to report these products as fake. This could be because they are happy with the quality of their bargain purchase, or because the product is so convincing that the customer is simply unaware they have unknowingly purchased a phony item. If the authorities are not being alerted to the fake goods being sold then they are simply unable to do anything to prevent it.

When it comes to counterfeited goods there is a clear moral issue at play – whether you are happy to save some money by buying through dubious channels – but more importantly, there is also a massive safety concern which should not be ignored simply to save a few pounds.

 

Image Source: Deposit Photos.

The Author

Gary Addison

Gary Addison is a business advisory expert based in the UK, specialising in assisting company directors and business owners with their statutory entitlements including redundancy. His website, www.redundancyclaim.co.uk helps hundreds of directors every week; usually in times of financial distress.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 6 Comments comments.

  1. Anon2 June 26, 2018 8:32 am

    “Counterfeiting can sometimes be seen as a victimless crime where the only ones losing out are the super-rich corporations whose products are being copied.”

    There are those who “see” counterfeiting perpetrated upon “the super-rich corporations whose products are being copied” as a “victimless crime”.

    They have chosen to ignore the violation of rights, which means choosing to ignore moral ethical and political principles, the right to the fruits of one’s own efforts, and the propriety of intellectual property rights.

    They have evaded the fact that they have a double standard rooted in their irrational vilification of capability, and that they harbor a small brutish envy of the successful and the good for being successful and good.

    They are unwilling or unable to understand that it is a litany of error, unreason, childishness, and dark squirming envy and vice, which enables them to conclude that because the victim of a violation of rights is highly capable and successful, somehow they do not qualify as a victim, and that any violation of their rights, and specifically counterfeiting, is a victimless crime.

    Whether they know, or accept it, or not, they have “concluded” through their tortuous “logic” that because the capable, the successful, the good, and the innocent are capable, successful, good, and innocent, their rights are not to be recognized and they literally should to be treated as rightless creatures by their own government, the implicit excuse for which is for the alleged “crime” of being “super-rich”.

    These people who “see” things in such ways simply do not deserve to live in a country upholding (or pretending to uphold) individual rights.

    In my humble opinion:

    To put forth an argument that counterfeiting is not a victimless crime by completely ignoring the individual rights of the “super-rich” which are violated, by ignoring the greatest, most directly affected innocent victim, by pointing only to the confused, defrauded, or endangered consumer, clearly constitutes apologetic pandering to the possible vices and errors of the audience, not by explicit acceptance of their errors but by implicit appeasement simply through silence.

    Such implicit support for (or merely non disagreement with) vice and error through silence does not constitute the most courageous or principled statement that could have been made in the face of counterfeiting.

  2. Anon2 June 26, 2018 8:39 am

    “Counterfeiting can sometimes be seen as a victimless crime where the only ones losing out are the super-rich corporations whose products are being copied”

    The most direct victims of counterfeiting are the so called “super-rich”. It is only a “victimless crime” if one sees the super-rich as not having the rights being violated.

    Last I checked, ethical and political principles of the civilized west still uphold individual rights, and the rights of the successful, the good, the innocent, are not stripped away merely by virtue of the mistake (or purported “crime”) of being “super rich”.

    Although the confusion and fraud and possible endangerment of consumers supports constitute evidence of “victims”, it ignores completely the violation of rights of the biggest victims, the so called “super rich” corporations.

  3. Anon2 June 26, 2018 9:24 am

    @Everyone : SORRY!

    So sorry for the repeat posting… there was a lag in my first comment’s appearance which lead me to believe there was an error at my browser and that my first comment was not sent… so I submitted a second one…

    Again sorry for the double (now triple) posts.

    sincerely,
    moral defender of “super-rich” (never actually got to work with one)

  4. Anon June 26, 2018 11:30 am

    lol – bravo Anon2 – words such as yours are worth repeating.

  5. Benny June 27, 2018 5:40 am

    Word of caution –
    Buying counterfeit fashions goods is a violation of property rights.
    Buying counterfeit electrical equipment – such as phone chargers – can be downright dangerous to life and property, as these goods usually carry counterfeit safety symbols and might not include protection against electric shock or fire. This is of greater concern than the theft of IP.
    On the other hand, paying outrageous prices for “snob value” fashion items simply to display a recognized “luxury” brand just makes you look like an anal orifice, completely regardless of whether the item is genuine or not.

  6. Anon June 27, 2018 10:04 am

    This is of greater concern than the theft of IP.

    Absolutely agree with you. Real life safety outweighs any sense of fashion – or perceptions surrounding fashion.

    On the other hand,…

    Here, though, you appear to attempt to diminish the real point of IP theft, by attempting to discount the “ completely regardless of whether the item is genuine or not.” with your own personal feelings as to fashion, its relative costs, and the human condition of “showing” that one CAN afford a higher price item.

    You muddle the focus on IP theft with such personal feelings, and this goes directly to what Anon2 warns against.

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