Impact of counterfeiting on efficient supply chain management and avoidance mechanisms

Abstract

Counterfeiting is omnipresent across products and geographies. Counterfeiting is rising owing to globalization, advanced technologies, consumers’ willingness for fake goods, lax regulatory policies and IP regimes. Though attempts have been made at anti-counterfeiting measures, complexity of this problem demands an integrated approach to understand the counterfeiting ecosystem. Counterfeiting infests supply chain stakeholders like manufacturers, consumers, government, and industry associations in multiple ways. The interplay of influencing factors has a cause and effect outcome on the supply chain Ecosystem. This causality is interpreted, in this paper, from empirical facts and is further analyzed by developing causal loops. Long-term impacts on these stakeholders, a generic duopoly market scenario with a regulatory authority is simulated using a system dynamics approach. The impact of anti-counterfeiting technologies, market-based competition and a stringentregulatory authority on managing efficient supply chains has been evaluated by simulating various scenarios.