Keeping Your Supply Chain Clean: How Intelyt Uses IoT to Solve Counterfeit Insertion

Counterfeit insertion is a major problem that affects tens of thousands of brands’ quality, safety, sales, and reputation. Across industries, counterfeit products are being inserted into the supply chains of unsuspecting companies, and the damage is costing billions of dollars per year. Low-quality, counterfeit copies of popular items are often illegally shipped into the United States and Europe, and can affect businesses in any industry - from apparel, to technology, to consumer goods, and perhaps most dangerously, the pharmaceutical industry.

 

In many cases, when the counterfeit products make it to their destination, they go unnoticed by the receiving company. This becomes a major problem when the supplies, which are often faulty or not to proper specifications, are used in production, and sold to customers.

How Much Damage Can Counterfeit Insertion Do?

Many companies believe they’re buying from a supplier that they trust, but might not find out that their shipment came from a counterfeit source until their consumers identify it for them - often just by opening up the box and realizing that their product is low quality or not what they expected.

These counterfeit insertions cost industries billions of dollars a year. According to a 2013 Industry Week report, the automotive industry lost about $3 billion in sales due to counterfeit items in their supply chains, and the semiconductor industry lost a massive $75 billion.

And the loss in revenue from re-ordering, recalls, and manufacturing delay is not the only problem caused by these low-quality knock-offs in the supply chain: Companies that unknowingly sell faulty products with counterfeit parts can severely damage their brand image. Dissatisfied customers will start to respond on social media that they paid a premium for a product that was not nearly as good as they were lead to believe it would be. This can take a serious toll on a brand’s reputation for making quality products. It will negatively impact customers’ future purchasing patterns, and ultimately affect the overall brand value - and the company’s share value.

Besides damage to the company and its brand, counterfeits also cause some extreme safety problems for customers, which are often most apparent in the automobile and pharmaceutical industries. If a pharmacy, for example, sells a product that they think is going to solve a health issues, but a counterfeit component has been introduced somewhere in the supply chain, a customer might unknowingly be taking an ineffective - or even harmful - medication.

How Intelyt’s Technology Prevents and Solves Counterfeit Insertion

For decades, counterfeit insertion has been a difficult problem to solve. Companies struggle to determine which components are counterfeit, to pinpoint the stage they entered the supply chain, or to identify the source of the counterfeit supplies. They often only learned of counterfeit supplies when it was too late to remedy the error.

Supply chain visibility should mean much more than just tracking the movement, progress, and general logistics of a shipment. Intelyt’s modern, IoT visibility solutions extend farther than condition visibility, which provides insight into forces the shipment experienced. Intelyt’s shipping insight goes deeper and is directly actionable when it comes to determining the legitimacy of a shipped product.

We are able to achieve this direct prevention of counterfeit insertion through our integration with the United States Customs and Border Protection agency. We can tag products that come from overseas manufacturers and pass through Customs. This allows us to monitor each shipment’s delivery and ensure that the package’s source is correct and that the box passing through Customs contains that tag certifying that it is the correct product. This allows shipping and logistics managers to confirm that the supplies originated from where they expected them to come from, and that they contain exactly what was specified in the order.

If, for any reason, a shipment arrives and doesn’t have the specific tag inserted by Intelyt, Customs can be alerted, and quickly determine if it is counterfeit or legitimate.

Whether you are aiming to protect yourself against counterfeit deliveries of components for products you are manufacturing, or to ensure that the products you are shipping to retailers remain original, genuine products, Intelyt can help. Leverage our IoT solution to Prevent counterfeit insertion from infiltrating your supply chain is crucial for sales, reputation, image, customer safety, and your bottom line.