SMEs dealing with counterfeiting
Counterfeiting is not a topic that is limited to large corporations and multinational organizations even small businesses face the wrath of counterfeiters. This is becoming a rising problem especially in developing countries. SMEs are said to be the driving force for economic development so in many developing countries, organizations are providing support in various ways to help boost the success rate of SMEs.
SMEs garnering all the support possible and implementing proven business models become successful and contribute to the development of the economy in which they function. Unfortunately, with this level of success comes challenges and one of such challenges is counterfeiting.
Counterfeiters observe the rate at which certain products move in the market and if some are faster than others, they invest in production of those items whether substandard or outright dangerous. That way, they mask the products with the same packaging but different content and distribute. When consumers buy these products and find out its substandard or outright toxic, word of mouth spreads and your brand is damaged.
What happens when SMEs face counterfeiting?
- Drop in Sales
- Confidence in your product is lost
- Company loses market share it worked so hard to gain.
- Discouragement of new business initiatives in that economy
- Loss of employment as company is not generating sufficient income
- Risk of Health and Safety
- Loss in tax revenue
- Ban of local products in foreign markets
How can SMEs deal with Counterfeiting?
Packaging that is not easy to replace is a strategy companies use to avoid counterfeiting. Apart from the fact that the packaging is not easily accessible, frequent package change is encouraged. This may seem like an expensive approach but the investment to keep your business afloat is necessary.
- Loyalty reward campaign
Products like Sproxil Champion enables businesses run loyalty reward campaigns for their consumers. No matter what industry you are in, whether you deal directly with distributors or end users, rewarding your customer is always a differentiating factor. Counterfeiters are not able to implement these rewards and the Sproxil Champion technology is immediately able to detect and provide intelligence information to businesses about where their products are being counterfeited because they have tried to fake the loyalty reward and our system detects it. This product also works post counterfeiting in the minds of the consumers as the business is able to draw them in with rewards and potentially expand their market share.
- Brand Protection solution
Brand protection labels like the Sproxil Defender is another solution that businesses can take advantage of. You place a label on your product and consumers can scratch and text to verify the authenticity of the product. This builds trust in your brand and eventually weeds out counterfeiters and discourages them from faking your products in the future.
It is important to note that you would always need to stay ahead of the market to avoid counterfeiting in your business. The effects of counterfeiting in a developing economy are dangerous and whatever solution would be best to eradicate this problem must be implemented to discourage the industry of counterfeiting.