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Counting the costs of counterfeiting

The fashion industry must work harder to actively tackle the problems of counterfeiting, with the issue costing the Western European market £5bn a year.

Brands need to ensure they are educating their customers about the problems of fake goods and the industry as a whole must act to inform the public about the costs.

Speaking to fashion consultancy Conceptable this week the issues surrounding counterfeiting were laid bare.

Managing director Ben Muis made it clear that this is not just a petty crime - rather sophisticated counterfeit operations are run by criminal networks.

He said: “The revenue generated from fakes surpasses that of illegal arms dealing and human trafficking. It even rivals the income from the illegal drugs trade, but has a much lower risk of prosecution”.

These criminal counterfeit operations obviously harm the health of our own industry and can lead to a drop in revenues for fashion players. The number of fakes devalues the exclusivity levels of brands and the availability of cheap counterfeits makes people more unwilling to pay full price for higher priced pieces.

A drop in revenues can ultimately lead to job losses across the industry. Nearly 400,000 jobs have been permanently lost in the UK fashion industry as a result of counterfeiting in the past 20 years. Throughout all countries in the developed world, this figure rises to 2.5 million positions.

Brands and retailers must act to make sure this number does not rise. They can’t just rely on customs to catch products at the borders, they must instead make sure they are tracking the hotspots for fakes and clamping down.

Leather accessories brand The Cambridge Satchel Company has done just this, teaming up with online brand protection specialist MarkMonitor to crack down on counterfeit versions of its products.

In just a few months the brand has detected and carried out enforcement for over 1,000 counterfeit product listings on exchange sites, with some listings advertising the availability of thousands of units.

Many of my friends have bought fake goods before and I have thought very little of complimenting them on how real their “Mulberry” bag looks or what a bargain their “Chanel” purse is but having seen the damage it causes to the industry, I now realise it’s time to try and educate people about how serious the problem is.

Readers' comments (3)

  • "It even rivals the income from the illegal drugs trade"

    I very much doubt it. Granted this is a serious problem, but let's not get ridiculous.

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  • Trading Standards Offices in most boroughs are completely useless. Id go as far as saying that they are responsible for almost 50% of counterfeit product available on the open market as most of them seem to have a very laid back approach on the matter of not dealing with Genuine complaints from Brand Owners. Camden Borough Trading Standards Office might as well not be there.

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  • There are certainly areas of the country where trading standards are too scared to go - Skegness market has been selling fake merchandise for more years than I care to remember, but the nobody wants to know, including the police.

    It should be said that hardly anyone buys fakes as a substitute for the real thing. Just because you buy say, a fake Lacoste polo, does not mean you were going to buy a genuine one.

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