Position: Protection of the lubricant supply chain from counterfeiting

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Counterfeiting is a serious global problem, with demand being largely driven by consumers’ continued search for high quality and affordable products and countered by rapidly evolving tactics from counterfeiters in rapidly growing global digital marketplaces. The lubricants industry, which produces many goods that are difficult to inspect and verify after packaging, is one of the most vulnerable markets to counterfeit goods.

These counterfeit lubricants can do a lot of damage to the supply chain – but brands can take steps to adapt their labeling practices and improve proactive detection of counterfeit products to better protect their products and brand reputation.

Counterfeit goods – a global threat

US Customs and Border Protection (CBP) data shows that more than $ 1.5 billion in counterfeit goods were seized in fiscal 2019 alone. CBP data also shows that a significant proportion of counterfeit products are manufactured outside of Western markets, for which many are destined, with China and Hong Kong being the source of 83 percent of all counterfeit goods seized.

Over the past decade, the number of customs seizures of counterfeit and intellectual property infringing goods has consistently exceeded 100,000 worldwide. These products are usually of inferior quality and do not meet the quality and safety regulations of the respective industry.

As digital marketplaces operate around the world, consumers are more exposed than ever to counterfeit discount goods. A quick analysis of Alibaba, China’s marketplace, shows that consumers looking for motor oil lubricants include Europe, Asia, North America and Africa.

The essential, yet understated, role of lubricants

Lubricants are an essential product that plays a central role in supporting the continuous operation of machines and has common applications in manufacturing, cooling, automotive and HVAC. They are usually used in highly specified roles that are tailored to individual machine parts and their functions. Every product must have properties in order to ensure proper operation. This means that replacing original products with non-approved, unspecified alternatives can have a significant impact on operations.

Counterfeit lubricants routinely cause more than physical damage to machinery and equipment, destroy brand reputations, severely damage consumer confidence and disrupt the entire supply chain.

Genuine versus counterfeiting: the label is the distinguishing feature

Counterfeit lubricants present a variety of problems for manufacturers and distributors as counterfeiters often employ a variety of counterfeiting tactics, such as:

By printing counterfeit branded packaging, these are then falsely represented as original products. The inability to directly inspect and test the contents of each product makes it a challenge to spot counterfeits before they enter the supply chain.

Many counterfeit goods can be identified by inadequate labeling and packaging. When counterfeit products attempt to imitate authentic brands by replicating packaging, clear and consistent labeling with full product and manufacturer details can be the differentiator.

Closing weak links and inconsistencies in the supply chain

Most lubricant companies use third-party printing companies to print their consumer-oriented labels. These organizations can be particularly vulnerable to leaks or theft that could fall into the hands of counterfeiters. Labeling and artwork solutions that store approved labels in the Asset Manager and grant access to the third-party printer allow better control and management of label design and printing in-house. The latest approved version can be printed.

Such solutions can also provide centralized management to ensure that all relevant security and compliance symbols are accurate, legible and can be updated at short notice.

In addition to fighting counterfeiting, this relieves employees of the burden of manual labeling in order to concentrate on other important tasks, reduces the often enormous financial outlay for the creation and management of print templates through the internal relocation of processes and ensures consistent, high quality label placement in the Correct proprietary font to prevent human error. This is a key differentiator from counterfeit products, which often have poorly placed, poor quality, and inconsistent lettering in generic fonts.

Weaknesses open the door to counterfeiters

Brands with easy-to-copy labels and packaging are easy targets for counterfeiters to brand their products as legitimate, and often infiltrate the supply chain through channels such as online stores or unknown sellers who are unlikely to recognize counterfeit products.

Trustworthy brands are often valued at face value by consumers and their products are consumed, resold or shared with little thought. Consumers routinely lack detailed product knowledge when it comes to chemical composition or industry regulations. They simply find and buy the recommended product for their needs.

The distributed global nature of many supply chains is also challenging. Weaker copyright laws, regulations, and enforcement mechanisms overseas make it difficult to identify and stop counterfeit production and sales.

Enforce the rules for those who slip through the cracks

There are several common trends that are uncovering counterfeit lubricants in many online marketplaces.

Inconsistent packaging placement and quality is common and a tell-tale sign of counterfeiting, often with incorrect language and grammar, while omitting important product information. These fakes are then often sold at significantly lower prices in order to undercut real sellers.

From a marketing perspective, the product, its quality, and expected performance are routinely overrated, while the support of images is unprofessional and does not meet the brand’s photographic standards on official sales sites. The implementation of uniform, high-quality product labeling and packaging graphics is an important measure to combat counterfeiting.

Brands must routinely search online marketplaces to identify suspicious sellers and post counterfeiting reports after shutdown as a deterrent.

Don’t underestimate counterfeiters – fight them at the highest level

On a global level, it is important to identify counterfeiters and their products in the market, prevent them from making sales, and enforce trademark protection. While counterfeiters can be easy to dismiss as a minor nuisance, brands need to detect and block “pop-up” counterfeits in near real time and track thousands of links from global digital marketplaces like Alibaba, Amazon, and eBay. When you take these steps to use technology for detection and enforcement purposes, lubricant brands can protect their intellectual property, reputation, and bottom line.

picture of Skica911 of Pixabay

Gurdip Singh is CEO at Kallik and Brahmpreet Gulati is CEO at BrandCares.



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