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6 Characteristics of Counterfeit Goods You Need to Know

  • Oct 12, 2015 | Michael Ansaldo

The world of knockoff goods has come a long way from the days when street vendors sold designer handbags and fauxlex watches out of the trunk of a car. Today, forgeries of everything from high-end headphones to haute couture proliferate in online marketplaces thanks to the rise of ecommerce. The International Chamber of Commerce predicted the global value of counterfeit and pirated goods to reach $1.7 trillion this year.

While counterfeits can leave consumers hundreds of dollars poorer with nothing but a useless copy of a prized product to show for it, the stakes are significantly higher for ecommerce businesses. Because many counterfeits are virtually indistinguishable from the authentic versions, you may unwittingly purchase lookalike goods from a supplier and pass them on to your customers. The cost of trading in counterfeits is steep -- it undermines trust in your business, and may get you banished from your ecommerce platform and subject you to legal action.

The best way to safeguard your business is to keep an eagle eye out for the telltale signs of counterfeit goods. Here are five of the most common.

1. Shoddy Packaging

In this age of “unboxing,” most businesses take extra special care with the packaging of their products. Your best defense against counterfeits is familiarizing yourself with the way different brands wrap their goods and keeping an eye out for anything unusual. Regardless of the brand, you can often identify a phony product before you open the package by spotting faded colors, low-grade printing, blurry photos, or flimsy packaging materials. Plain, unmarked packaging is a definite red flag.

Other clues require more sleuthing. Look for typos, misspellings, and grammatical errors in the packaging copy and in any instruction manuals or other documentation. Also, any reputable company will include contact information somewhere on or in the package. Make sure it’s there.

2. Poor Craftsmanship

Legitimate products, particularly luxury and technology items, are difficult to replicate credibly. While they may pass an eyes-on inspection, they will likely reveal inconsistencies once you have them in-hand. Counterfeit versions of smartphones and tablets, for example, frequently weigh less than the real deal or have slightly different dimensions. Fake fashion items commonly have frayed stitching or less stitching per inch than their authentic counterparts. In general, if the “fit and finish” of a product doesn’t seem up to par, you should be wary of it.

3. Missing or Extra Items

Sometimes the packaging and the product inside pass muster, and it’s only what’s not there that tells you something isn’t right. Missing cords, power supplies, or other accessories should be tip offs that something’s amiss. Absent warranties or instruction manuals also make a product suspect.

Other times, fraudulent products do include the extras -- but they’re the wrong ones. Several year ago, a fake iPhone 3G S was discovered on eBay. The giveaway? It came with a stylus, a battery booster, and a free protective case.

4. Odd or Missing Certification Labels

Increasingly products -- particularly those that must meet strict performance or safety standards -- include certification labels. Others, such as Microsoft software, come with a Certificate of Authenticity specifically to thwart counterfeiting. Make sure you’re familiar with how these labels look and where they should appear on the product and packaging. The design and placement should be uniform across items, and may include a control number you can use to verify the product on the manufacturer’s website. If the label doesn’t look right, or worse, isn’t there, you may have been duped.

5. Customer Dissatisfaction

The best counterfeits may not reveal their true nature until they’re actually put to use. “The proof of pudding is in the eating” as the old saying goes, and your customers will surely let you know if something about the goods you’re selling tastes foul. Flaws and failures in legitimate products should be the exception not the rule. If you’re getting an inordinate amount of negative feedback on a particular product, you need to investigate. If you find the product is counterfeit, contact the supplier or your ecommerce platform.

6. Ships From?

In some cases, authentic goods can only be purchased from the parent company or from authorized distributors. Such is the case with Otterbox. When shopping on Amazon, consumers are advised to only purchased Otterbox products from stores stating, "Ships from and sold by Amazon.com" or "Ships from and sold by OtterBox."

Otterbox goes so far as to keep a page on their site dedicated to fighting counterfeiting. Beyond "place", the post touches on product, pricing, and packaging.

The problem of counterfeit goods promises to get worse as fabricating fakes improves. But you can protect yourself and your ecommerce business by being vigilant in identifying phony items and keeping them out of your product portfolio.

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Michael Ansaldo
Avalara Author Michael Ansaldo