Counterfeiting and Diversion is Booming in China … So I went to AIPIA Shanghai

Did you know that 80 percent of the world’s counterfeit goods come from China? Everything including luxury goods, cosmetics, wine and spirits, medicine and more are vulnerable to duplication and sometimes the fakes are so similar that it can be hard to determine the real from the phony. With that being said, brand owners across the globe view China’s counterfeiting business as a threat to their own.

At Systech, we’re no stranger to counterfeiting and diversion, which is why I attended the Active & Intelligent Packaging Industry Association’s (AIPIA) event in Shanghai last week.

With over 200 attendees, representing some of the top 500 Fast Moving Consumer Goods and Food and Beverage companies in the region, AIPIA Shanghai gave us the opportunity to present Systech’s award-winning solutions to prospective clients and the chance to see what some of our competitors are pitching as well. Here are some key takeaways from the event and things I noticed over the two days.

1. Current methods being used to detect counterfeiting and diversion are difficult and pricey.

I was lucky enough to have a handful of really rich engagements with attendees stopping by the Systech stand to learn more about our offerings. In some of these conversations I heard the same thing – the cost of detecting counterfeiting is high, and not very user-friendly, and diversion is detected by an anonymous report or word of mouth. When a solution isn’t cost-effective and difficult to use, brands are more reluctant to fully adopt it – thus the struggle against counterfeiting and diversion continues. Brand owners are looking for a simple, cost-efficient solution with a consumer engagement component that allows end users to authenticate products as they are purchased.

2. Brands want to learn about counterfeit products, but in a discreet way.

How many times have you seen an article about a counterfeit raid resulting in the seizure of hundreds and thousands of fake products? In these articles, the brands are often named and so consumers’ confidence might have been negatively impacted. This means the pressure is on for brand owners to find a solution that allows its customers to authenticate along the way. Unfortunately, the exposure online can be detrimental and while Systech’s offerings can’t control border patrol and/or media outlets, we can help combat counterfeiting and diversion which in turn reduces the negative press.

3. Systech was the only non-additive solution.

This didn’t come as a surprise since we are the only solution on the market that utilizes a product’s existing barcode to track, trace and authenticate. Packaging professionals tasked with finding the best technology provider to solve the packaging and supply chain issues their companies are facing. But they are also under pressure from marketing to keep the packaging as close to its original state as possible. The extra layers from a hologram or a watermark can confuse consumers, take away from the beauty of a design and make the appearance seem overcrowded. Worst of all, it is not difficult for counterfeiters to replicate these additive elements. By leveraging something that’s a requirement on a package (i.e., the barcode) packaging professionals are able to keep their teams happy.

Every event that Systech attends is an opportunity to show off the technology that our solution architects and engineers work tirelessly on to solve the supply chain issues of today and tomorrow. I’m glad I got to attend AIPIA Shanghai and look forward to spreading the brand protection message at the next event!

Ready to learn more about Systech's anti-counterfeiting and diversion detection solutions? Contact us today!