Fighting fakes

HP is seemingly the most proactive vendor in the printing realm when it comes to combatting counterfeit products. The vendor is so serious about quashing fakes it has stepped outside of the remit of the Imaging Consumables Coalition of Europe (ICCE) — a task force tackling fake products in the EMEA region — to combat the problem head-on itself. Tina Rose, EMEA anti-counterfeit programme manager, supplies aftermarket sales at HP, says that the vendor’s hardline approach has been reaping dividends with more than 60 partner audits already undertaken in the Middle East this year. She explains how to spot fakes and what membership to HP’s anti-counterfeit programme means for the channel

Tags: Hewlett-Packard CompanyUnited Arab Emirates
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By  Julian Pletts Published  June 9, 2009 Channel Middle East Logo

What sort of resources does HP devote to tackling counterfeit products and channel awareness in the Middle East?
Every person within IPG that deals with partners, particularly for inks and toners, has information from me to help partners understand what they should do. We have the supplies partner portal with all the documents for resellers in various languages. Training opportunities are always important for me to run.

I recently conducted a training event with wholesalers from the Middle East which took place in Athens. In that session I explained the programme, showed samples and took the time to explain the documents and detail what to look for. I also have close ties with HP’s people here and they will contact me.

Do you think the channel cares enough about counterfeit products to proactively challenge the trade here?

It depends. Culturally there is a difference between countries. We don’t want to force people to do something they don’t want to, but we want to give them the avenues if they want to act. I think, particularly now, when times are a bit tougher than they were a year ago, partners are looking at everything and anything that might affect their business.

I don’t think they will go out actively looking for counterfeit products, but if they see evidence of it themselves then they can contact us by the various methods. Because we communicate constantly about successes we have had over the past couple of years, partners feel that HP is making a difference.

Are there any plans to reduce the price of HP consumables as a way of tackling illegal business?
A couple of years ago, HP looked at the issue of price because people were saying it was too expensive. They then introduced more products into the market to cater for occasional consumers. You had the Best Choice portfolio and other products that came in a black and white box so that there was a cheaper alternative.

In terms of pricing for the Middle East I can’t tell you anything about it that is going to be accurate, but certainly that is a question we are always going to be asked. And it’s always going to be a difficult one to answer. We do invest US$1 billion a year on just inks and toners and we need to recoup that investment so that we can create quality products for the consumer.

What are the potential repercussions for channel partners that get caught with counterfeit products?
We are serious about pressing for convictions. But we have to take each case on its merit and don’t want to be heavy-handed. We are, however, investing a lot of money in our anti-counterfeiting programme and don’t want it to be toothless. We say in our guides produced for audits that [audited partners] run the risk of being reported to the authorities.

We will cooperate with authorities as part of investigations and if we have to inform them about partners then that is something we will have to do. On the whole, when we have found partners with counterfeit products, they have been quite contrite, handed over the paperwork immediately and have been horrified that they have fallen into the trap.

A couple of years ago in Italy, for example, we had the biggest single seizure ever — worth US$35m. That case is now going to court. There’s a criminal case and HP also launched a civil case because the criminal case was taking a long time and we wanted to send the message to the channel.

Is the anti-counterfeit partner programme part of HP’s current partner programme or is it an additional initiative?

If you are in the partner programme you are part of it and an audit will happen to you at some point. It is in the terms and conditions of their contract that they have to be part of it. We select the partners at random and make sure that even remote companies still get audited.

What is HP’s philosophy to resellers that have been duped into purchasing counterfeit products?

A lot of people have been genuinely tricked. We talk to them about the fact that they have been duped and how it has happened. We go over what they need to look for and tell them they have to be more careful and educate all staff.

We warn them that they have violated certain conditions of the terms of their contract, but they usually provide the information of where they got the counterfeit products, which again demonstrates they did not know what they were purchasing.

That helps us take the investigation further. Usually, we would conduct another audit, pretty soon afterwards, just to make sure they were not actually complicit. It’s very important we get the full support of the partner.

Does being found with counterfeit products affect a partner’s standing in the partner programme?
We warn them that if we audit them again and they’re found with counterfeit product, they might be removed from the partner programme. Each case is taken on merit and it is very difficult to say things like, ‘a single problem equals a warning, two and you are out.’

We try to get as much information as possible and there have only been three partners over the last 18 months actually eliminated from the programme. One had an enormous amount of counterfeit, and the other was found repeatedly with small amounts.

Which markets will you be targeting in the region over the rest of the year and into next year?
We’ve had great success in Saudi Arabia and are going to continue working there to remove as much counterfeit product as possible. But wherever a lead comes in, we are going to focus on it. The Middle East and Africa region and Central and Eastern Europe are key regions for our work. We don’t necessarily distinguish between them. The focus of the audits is definitely the Middle East and Eastern Europe.

Have counterfeit products been finding their way into the authorised distribution channel in any way?
We did find two wholesalers which had counterfeit products and they were both really astonished and horrified as they are quite big wholesalers. It was a case of seeming too good to be true, and in fact, it was. In that case we asked them to recall the people that they had sold those products on to and we got them to try and recall them.

How closely do you work with governments in the Middle East region to tackle the problem?
We have a government affairs team in HP and someone who is specifically involved with anti-counterfeit and government affairs. They are always looking at different ways of improving the situation. We also have investigators that work in each country and are well connected. In some countries it is not taken as seriously as others and the legal aspects are not as strong as they should be.

Are governments in the Middle East strong enough when it comes to their policing of counterfeit products?

Yes, definitely. I don’t know enough about the laws here, but we have had some great support from officials here that has helped us in challenging potential violators.

Fraud finders: Top tips for spotting counterfeits

1. Know your real product
HP provides partners with published information on all of the correct and up-to-date details about what to look for in printing products, such as the current issue security label.

2. Consider the sales pitch

Rose says that HP will not do telemarketing so alarm bells should ring if they get a call from someone claiming to sell for HP. Also, pitches that include elements such as cash on delivery should raise some suspicions among channel players.

3. The price isn’t always right

Contrary to most beliefs, counterfeit products may not be cheaper than the genuine articles. In fact, the average fake product pusher knows that if they come in too low people will know something is up. Rose says that she has come across instances of counterfeit products being priced slightly higher than the real versions to give the impression of being genuine.

4. Buy from approved suppliers
HP partners will be familiar with the vendor’s partner portal. It also includes a smart partner locator which should be used to find the nearest approved reseller in the Middle East.

5. Be tamper proof
Fake products can often be found inside real HP boxes. Rose reveals that crooks will often ply open genuine boxes with chicken wire and then reseal them with counterfeit product inside or even purchase used boxes from companies. Resellers should check the whole of the box very carefully. Look for broken security seals, excessive ware and tear and a security label that is the latest issue.

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