From international travel restrictions to physical distancing measures in factories across the globe, the Covid-19 pandemic has placed enormous pressure on the supply chains on which we depend.
But logistics are not the only challenge. Counterfeiters are taking advantage of this time of heightened vulnerabilities, and risk polluting a brand’s stock and reputation.
Now more than ever, the onus is on companies to keep an eye on what appears online — what’s theirs, and what might not be.
It’s well known that many brands source components and ingredients abroad, particularly from China and South East Asia. When the outbreak of Covid-19 forced factories to close and official export channels dried up, counterfeiters used illicit channels to flood supply chains with fakes.
Lockdown restrictions that make it impossible to conduct site visits have further compounded the situation, leaving brands heavily reliant on virtual communication to manage long supply chains crossing multiple borders.
Fraudsters have been quick to spot an opportunity. As early as March, an Interpol operation led to the seizure of fake face masks, hand sanitisers and medication valued at over $14m. The authorities closed more than 2,500 web links leading to illicit items.
Yet counterfeiting remains widespread across consumer industries. Before the pandemic, its economic cost in the EU was €85bn annually. One can only imagine what it is now.
Meanwhile, as supply chains struggle, online shopping has soared. Between February and June this year, online spending increased by 61.9 per cent in the UK, according to ONS figures. Not all these digital shoppers are well-versed in the tricks of online trade. And one negative experience can destroy consumer confidence just when companies need it most.
The challenges are clear, but the situation is far from hopeless. So here are some practical measures that brands can take to shore up their supply chains and fight the fakes both on and offline.
Know every link in the chain
First, map your supply chain so that you know where your stock should be and when. If a shipping container makes an unexpected stop, you can investigate why. Identify vulnerabilities along the route and establish contingency plans. Make sure to communicate directly with suppliers to build strong relationships, from manufacturing to shipping and storage, all the way to delivery to the consumer.
Regular visits to factories are usually a must, but may not be possible at present. If you can, organise virtual visits as a temporary solution. Frequent contact will mean you are up to date on any local changes to Covid measures and can make necessary adjustments.
Review customer complaints with a laser focus
It can take considerable time to realise your product has been counterfeited. Monitoring customer reviews and returns can be an effective tool for identifying a problem. Have you seen a recent increase in complaints and do grievances follow a pattern? This could be a clue that non-genuine stock has seeped into your supply chain. Also consider buying samples to analyse their validity. If you find a fake, counterfeits may be a widespread issue.
Building a brand protection strategy that harnesses the latest tools to fight fakes is a must. In the long term, products can be designed with security features, such as secret threads or holograms, to differentiate them from counterfeits and educate consumers on what to look for in genuine goods. Serialisation codes and track and trace services with geolocation can also help provide a bird’s eye view of your stock on its journey.
However, for more immediate results, a proactive online brand protection plan ensures you are keeping eyes and ears open across online marketplaces and social media sites, and removing all sellers and products which contravene your intellectual property. Quickly identifying and removing spurious products reduces visibility, preventing their purchase, export and distribution.
Keep it simple
The longer your supply chain, the more difficult it can be to manage. Source smartly and keep the number of links in the chain to a minimum. This will make it easier to monitor your stock’s movements and locate the source of any issues when they occur.
Indeed, build the final product at home if possible. This gives you greater influence over quality control and the power to inspect components. If you do uncover fakes, be honest and open with distributors and consumers. Have a plan in place to identify and remove counterfeits and to communicate all actions to customers.
Few of us expected the havoc that has been wrought upon industry this year. But by securing your supply chain, your brand can enjoy the benefits of the spike in online shopping, without falling prey to its pitfalls.
Main image credit: Getty