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Counterfeits cost European fashion £5bn every year

Nearly 400,000 jobs have been permanently lost in the UK fashion industry as a result of counterfeiting in the past 20 years, research suggests.

Throughout developed countries this figure rises to 2.5 million positions, with the UK accounting for more than 15%, or 380,000, of the total. This equates to about 19,000 jobs a year.

According to the World Customs Organisation, 7% of total world trade is counterfeit; however, for fashion this figure is closer to 10%. In western Europe clothing and footwear companies lose at least $7.5bn (£5bn) a year through fake fashion.

Fashion consultancy Conceptable told Drapers the copying of goods in the fashion industry was growing at an “alarming” rate, with a 15% rise from 2010 to 2011.

Ben Muis, managing director of Conceptable, said: “Counterfeiting is an issue for all brands that are popular, whether they are a mid-level label that is hot on the high street or a luxury brand.

“Fashion rides on popularity and popularity fuels counterfeiting,” he added. “Bags and shoes are increasingly targeted as counterfeited items. Non-sports shoes are popular. It seems the Jimmy Choos of this world are
being targeted.”

Mid-market labels have also been affected. For example, last month Fred Perry settled a dispute with etailer The Hut Group over the sale of counterfeit jumpers on sites including Thehut.com, Zavvi.com, Sendit.com and via the group’s outlets on eBay and Amazon.

As part of the settlement, The Hut Group will pay damages and legal costs to Fred Perry and has agreed not to sell such infringing garments in future.

Muis warned other brands to wake up to the reality that they are potentially losing money.

He said: “Brands are not only losing revenues, their costs are increasing whether it be on labelling, legal action, reputation management and even the cost of brand value can be lost.”

The consumer attitude towards counterfeiting is “fairly poor”, Muis said, noting that 31% of UK consumers did not realise they had bought fake goods. Globally, 22% of consumers have knowingly bought fake fashion products, however.

“They don’t realise what they are fuelling is criminal activity. We have a generation now that is more worried about image than morality,” he said.

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