Protection against product copying
The prevalence of counterfeit product is a rapidly increasing problem around the world. Branded products are being copied, and replicas – often of poor quality – are being churned out of shadowy factories.
Counterfeit product is a big issue for suppliers and is also of growing concern to plumbing product specifiers and installers who, for their reputations’ sake, want to ensure they are installing the genuine article.
And with more work on big projects being handled remotely (designed in one country, constructed in another), the control of such issues is becoming more difficult.
WPR spoke to various industry associations and plumbing supplies companies in several countries. We also looked at some of the remedial actions being taken or planned, including those in relation to major industry exhibitions.
German Valve Manufacturers Association deputy managing director Boris Abadjieff says durable consumer goods such as taps and showers are at the forefront of product copying. However, counterfeiting has also become an issue for manufacturers of investment items such as machinery.
“We estimate that 80% of the illegal reproduction comes from China,” he says.
“Turnover of the German sanitary valve industry is about €2 billion (US$2.6 billion), and loss of turnover in the industry due to product piracy is about 3% depending on the product and the region. In addition, there is a loss of reputation and possible damage of the brand name – which you cannot calculate.
“In July 2004 our sanitary valve manufacturing members formed a coalition against product piracy to exchange information on counterfeiters and decide common strategies. Multiple manufacturers can often be affected by one counterfeiter.
“Provided that the member company has claimed the design patents for a certain sanitary valve in a specific market, if the company comes across a counterfeiter in Germany or abroad, there are different legal measures to prevent distribution of the product. Cooperation with customs can also result in confiscation of counterfeits.
“We also take action to inform the public about the dangers of counterfeited sanitary ware and seek to influence political decisions in Berlin or Brussels (European Commission), and sometimes also in China through our offices in Beijing and Shanghai.”
Dornbracht is a German manufacturer of premium bathroom fittings and accessories that has many problems with counterfeiters.
The company’s Alexander Wolf says for several years manufacturers around the world have adopted Dornbracht designs and sold the products at a lower price.
“Most of these plagiarisms are from Asia (especially China) and Italy, and at the ISH sanitary fair in 2005 we found 15 exhibitors that had Dornbracht copies,” he says.
“We lose 3–4% of our turnover per annum and could have 100 more employees if product copying was eliminated. What can we do about this situation?
“Our fittings and accessories carry worldwide design patents, so we have the chance to get an admission from suppliers of copied products. Mostly, we order them to cease marketing and selling the copies. If they don’t accept this we do not hesitate to go to court, where we have had some success in recent years.
“We also monitor the market every day for new copies. In the past it took two or three years for the first Dornbracht copy to come onto the market, but now we can identify the first plagiarism of our latest series within six months. In addition, we seek to raise public awareness of the counterfeiting problem. If end-users did not buy these copies they wouldn’t be produced, and those manufacturers wouldn’t exist.”
US-based bathroomware manufacturer Kohler Co says that to avoid problems with counterfeit products specifiers should buy from a reputable source like a Kohler supplier, distributor or showroom.
“These channels guarantee that all their products are genuine,” a company spokesman says.
“Only a true Kohler product performs with the quality and promise of the brand. Specifiers and plumbing contractors should be aware that using counterfeit goods can potentially cause a lot of bad publicity if the buyer is caught, resulting in irreparable damage to their reputation. So why would they use a product of inferior quality and risk losing their professional integrity?”
Yvonne Orgill, chief executive of the Bathroom Manufacturers Association (BMA) in the UK, says counterfeit product is becoming more of an issue across all of Europe, not just for the UK.
“Some of our members have taken action and issued court proceedings to stop counterfeit sanitary ware and brassware being imported by distributors,” she says.
“The problem is fast becoming a major issue as more product is profiled at exhibitions by an increasing number of new and established distributors, who then use the same supply route to market as the established credible manufacturers. This causes a problem in bringing these distributors to justice – who blows the whistle?
“I have been involved in many discussions with Trading Standards and corporate lawyers who are looking into aiding credible manufacturers, and the BMA is drafting information sheets that will assist in educating the supply chain and the consumer to buy credible products with worthwhile guarantees.
“We are also in the process of setting up an installers’ forum to aid and educate installers so they don’t fall foul of counterfeit product. These people are at the forefront and spend considerable time and money rectifying problem areas.”
The BMA has representation on 32 Standards committees in Europe and works alongside many of the related trade bodies and research houses. Through the newly-formed Bathroom Academy, the BMA is establishing a certification program that will increase product knowledge and raise awareness of the importance of compatibility between bathroom products, the water supply and lifestyles, making the purchase of bathrooms easier.
Membership of the BMA is open to manufacturers of bathroom products that are established in the UK market and have the support mechanism for the supply chain.
Counterfeit product is also a problem in pump manufacturing. Davey Water Products, an Australian-based and owned pump and water products manufacturer with branches in Chicago and Auckland, has experienced the complications associated with counterfeits.
Managing director David Cleland says most of the problems emanate from China, where there is a lot of reverse engineering of products.
“The quality of some of these copies may appear satisfactory but many do not have the same standards of tolerance,” he says.
“Davey has encountered a cloned version of an engine-driven pump for firefighting. The engine and Davey pump designs were copied but not the Davey brand – the counterfeit product bore a different brand and colors.
“We tackle the problem by ensuring that patents and registered designs are in place for our products, and we also put a lot of emphasis on innovation and the continual development of new products.”
Action at exhibitions
In January 2006, international exhibition organization Messe Frankfurt (which runs the ISH exhibitions) and its five partner organizations launched a broad-based information campaign in the fight against product piracy and counterfeiting.
After seven shows in 2006, about 4,800 inquiries and 900 consultations were counted at the Messe Frankfurt Against Copying information booth. Some cases were referred to the emergency legal service of Messe Frankfurt, and many other concerned companies worked directly with their own lawyers.
A brochure titled Messe Frankfurt Against Copying was published. It outlines actions that can be taken against product piracy by exhibitors before and during exhibitions.
Messe Frankfurt’s information campaign is aimed at counterfeit products, which are estimated to make up 8% of world trade. It supports the policies of the EU and German Government, including actions such as Customs checks.
Action is also being taken in Germany by the anti-counterfeiting association APM. This includes a public relations campaign to educate the community about counterfeiting of products and trademarks.
In addition, investigatory work is carried out to monitor the market for counterfeit products as well as direct investigations into specific cases. Many cases proceed to court, and costs can be divided between member companies involved in the action. APM provides an information exchange for members to encourage a cooperative effort to combat counterfeiting.
According to the vice-president of Messe Frankfurt in the US, Dirk Ebener, action to counter product piracy is also a high priority in that country.
“Industry associations in particular are very aware of this problem and are focused on how to handle violations at trade shows,” Ebener says.
“Once exhibitors display products that could present a counterfeit situation, there are various options for exhibitors and show organizers, including removal of the products from the booth.
“However, such action could result in an aggressive confrontation. The biggest challenge is often the time element, because most trade shows last only two or three days, so by the time an order is given to close a booth the show is over.
“We have found that the best way to handle the problem is to ensure proper product documentation is in place, and to collect as much information as possible on site to support future action. Companies affected by counterfeit products can also seek support from US Department of Commerce representatives locally and in other countries.
“Action against counterfeit products by Messe Frankfurt is expanding show by show, including through the provision of on-site legal counsel. Show organizers and exhibitors are teaming up, and the issue is beginning to diminish. Violating companies can see that they are running into big problems at future shows.”