Ensuring brand protection with VINSAK solutions

The rapidly changing global economy demands ever-greater vigilance to combat brand piracy, which is currently responsible for losses and has become an ever-increasing issue facing many brand owners today. Unlike contraband market activity—where counterfeit, refurbished, or stolen goods are resold as genuine brand products—gray market activity involves the unauthorized movement of commerce through various geographies by rogue distributors and trusted channel partners alike. According to the World Customs Organization (WCO), whose mission is to improve the administration of customs, pirated and counterfeit goods account for roughly seven to nine percent of global trade. It estimates that the value of counterfeit trade exceeds US$540bn. In India, even as the Federation of Indian Chambers of Commerce and Industry’s (FICCI) Brand Protection Committee estimates a loss of Indian Rs. 200 billion per annum, the media reports assess the damage to the Indian industry at around Indian Rs. 300 billion per annum. It is no wonder that companies are now taking a hard look at their Brand Protection Strategies to combat this ever-increasing problem.

Affecting adversely…

Due to the prevailing gray market activities, there may be wide adverse impacts on the concerned brands. Generally, the grey market activities spoil business relationships between manufacturers and their channel partners. In the end, authorized distributors reduce their ordering from manufacturers, which ultimately reduces the profits of both business entities.

In the open market customers are not aware that the product has been diverted through unauthorized means potentially creating issues with warranties and returns. The imported product from gray market may not have the functionality, accessories, and features that lead to the customer dissatisfaction towards brand, creates brand equity issues, quality, packaging, instruction manual, price, and safety concerns. This ultimately leaves the negative impact about the brand in customer’s mind hence it leads to the deterioration of the brand image.

Also, making the prices down as supply goes up causes the genuine channel partners to slow down in their order patterns from the original manufacturer as one gets more profit on the product from gray market. This results in conflict in various systems as inventory planning issues, demand problems within the prevailing distribution system that ultimately affects product pricing and availability concerns of the product. It also causes reduction in profit margins and impact of the brand.

Besides, the gray market also creates various other concerns as negative customer experience, legal and regulatory risks, health issues (Pharmaceutical and FMCG industry facing the direct impact), directly affecting the economy at large. It also creates factor like surplus inventories, falling of manufacturing and distribution costs. Brand owners may experience, channel conflict, inventory issues, price fluctuation, reduced profit and brand erosion concerns.

How to deal with…

Along with a comprehensive brand protection strategies against counterfeit activity, infringement of trademark, intellectual property rights, and copyright; spreading regular awareness about brand among internal stakeholders as well as channel partners and other associated partners; ensuring regular audit of the product, packaging, and gathering feedback from the market, the solutions from a brand protection expert like VINSAK may prove effective to deal with all concerns. For the purpose, various technologies are available in the market. VINSAK also offers wide range of brand protection solutions, including: VINSAK security inks, security software, secure print technologies, security substrates, and VINSAK track & trace, etc.

For more details visit: www.creedengineers.com

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