How Counterfeit Beverages Affect Your Brand
By Carlos Rabadán Escudero, Global Domain Lead, Track & Trace
Counterfeit alcohol has again made the headlines for some of its deadly consumer consequences. These events have a ripple effect on the liquor industry. There is the economic impact of lost revenue, reduced market share, and loss of expansion opportunities. The other effect is the damage to a company’s reputation from having their brand associated with counterfeit spirits, as well as consumer trust in the label. Integrating track and trace technology into the adult beverage supply chain enables the mitigation of consumer, financial, and non-compliance risk.
The flow of fake alcohol is prevalent in many parts of the world. No type of liquor and spirits is immune from the counterfeiters. SafeProof.org notes “…vodka is a favorite [of fake booze producers; however], all kinds, gin, whiskey, vodka, wine and even beer are produced by [them].” And, a report from the European Observatory on Infringements of Intellectual Property Rights showed “€1.3 billion (3.3%) [in Europe] are lost due to the presence of counterfeit products in the marketplace.” Additionally, “[t]he Interprofessional Council of Bordeaux Wine boldly estimates that 30,000 bottles of fake imported wine are sold per hour in China.” Noncommercial alcohol is big business, unfortunately.
Manufacturers need to implement traceability protocols and technology to protect their bottom line and brand. Yet, supply chains are composed of many contributors and most are operated by separate entities, such as shippers, handling the alcohol between origin and destination. Therefore, it is important to understand
- The number of integrations needed
- Supply chain partners’ solutions in use
- What data will be exchanged
This information will guide your evaluation of the solution you ultimately select. The result of the implementation of track and trace technology, such as Global Track & Trace (SAP GTT), provides:
- Real-time supply chain visibility into both product creation and the movement of goods and assets across company and system boundaries
- Ability to conduct analyses with data captured from multiple separate stakeholders while keeping control of which information is shared
- Document and process tracking, such as deliveries and shipments
- Uninterrupted information about product origin
- Complete product history (where, when, how a product was transported from production to consumer)
- Data on the environmental conditions during transports (temperature, shock & vibration, etc.)
- Supply chain cost reduction from improved collaboration and the avoidance of the costly firefighting of last minute or unexpected problems
Beverage manufacturers face many challenges from sourcing ingredients to shipping disruptions. Counterfeit products should not be one of them. With the application of track and trace technology, companies have better visibility into their supply chain from origin to destination. For example, Russia recently updated their automated information system (EGAIS) to not only track manufacturing and wholesale of alcohol, but the distribution and retail sectors. Even consumers have access to a mobile app they can use to scan the barcode. Ultimately, the data provides peace of mind that the beverages made, shipped, and delivered are the true products. Track and trace is protection for the bottom line and brand.
For more information on this technology, please visit our TRACK & TRACE PAGE or DOWNLOAD OUR GUIDE.