Bring to mind purchasing some Windex from an online marketplace only to discover that what you were actually sold was a crude mixture of rubbing alcohol and blue dye.
 
Would you buy from that marketplace again? Not likely.
 
For online retailers, there are a handful of surer ways to lose your consumers’ trust and their business than by unwittingly trafficking in fakes. But unluckily, the problem of pirated and counterfeit goods is reaching a fever pitch in the U.S., and manufacturers face mounting pressure to evolve their methods of erasing counterfeits from their supply. This problem highlights the need for next-gen solutions, and points to the emerging role of smart sensors.
 
Elevated Scrutiny for Manufacturers
 
On April 3, President Donald Trump signed a presidential memorandum aimed at wiping out trafficking in fake and pirated goods. It defines the federal government’s plans to double down on its efforts curbing the spread of imitative products.
 
Additionally, the memorandum commissions the composition of a Report on the State of Counterfeit and Pirated Goods Trafficking, to be prepared and issued within the next seven months. That report could be accompanied by more stringent enforcement actions, along with the implementation of regulatory and policy changes that could hold third-party intermediaries like Amazon and eBay, and the manufacturers on their supply chains, to blame for fraud.
 
White House National Trade Council Director Peter Navarro called the memorandum a “warning shot across the bow” for e-commerce giants like Amazon. But manufacturers should view it exactly the same.
 
Countering Counterfeits With Strategic Solutions
 
Faced with increased government scrutiny and pressure from online marketplaces, today’s manufacturers must make sure the legitimacy of their entire output.
 
While tracking each and every item produced might not have been justifiable from a cost perspective even a few years ago, the scenery is not the same now. With fraud running rampant (the market for brand counterfeiting is projected to reach $1.82 trillion globally by 2020) the onus is on manufacturers to make every product provably legitimate. The alternative is potentially massive product recalls alongside the looming threat of federal regulations and fines.
 
With a 210-day interim before the federal report is released, it pays to be proactive.
 
Here are the three steps I’d suggest manufacturers take during that time to get ahead of the problem:
 
•             Evaluate existing quality control processes: If ever there were a time for manufacturers to take a close look at how they’re curbing fraud in their supply, it’s now, before potential enforcement actions force the point. By convening an inner power team of decision makers to proactively determine weak points in existing processes, manufacturers can take a critical first step toward evolving their fraud prevention tactics.
 
•             Look into smart sensor technology: Luckily for us for manufacturers, tech providers could offer significantly sophisticated tools to fight the rise of counterfeiting. Exclusively, intelligence-driven sensors are emerging as the manufacturing industry’s best bet at eliminating fraud. These embedded sensors have the potential to ensure the legitimacy of every item of a manufacturers’ output. And because they’re being developed to be both tiny (smaller than a pencil tip) and cost-efficient, they are poised to be industry standard across manufacturers of all sizes.
 
•             Closely follow government actions and align with law enforcement: As President Trump’s memorandum makes clear, the federal government will develop a centralized role in keeping track of for fraud, and potentially hold both marketplaces and manufacturers accountable as well. Because of this, manufacturers should seek out opportunities to work proactively with government agencies to retain fraud at bay. While not every manufacturer will be able to launch large-scale fraud prevention initiatives like Alibaba, these types of efforts will serve manufacturers well.
 
By approaching the problem of counterfeiting with a proactive eye, manufacturers can take a critical step toward defending their output — and their brand identity — against an progressively sophisticated and pervasive threat.
 
This article is originally posted on tronserve.com