The CEO of Australia Post, Christine Holgate, says brands need to insert security devices such as microchips and QR codes in packaging for products destined for China, where counterfeiting is rife.
Speaking at the Australia Post Cross Border Ecommerce Expo, Holgate said brands exporting to China are much better off investing in packaging security than hiring lawyers to defend their IP.
Holgate told the audience that in her previous job as CEO of Blackmores, she saw counterfeit packaging so good even she could not tell the difference, apart from when it was even better than the Blackmores packaging.
Holgate recommends near field communication (NFC) chips, which is what Blackmores used in its infant formula products. Holgate said the chip meant that the product was validated as authentic, and could be located at any time.
Blackmores today uses both clear and hidden security on its products for China, including the China Association for Quality Inspection (CAQI) holograms.
Seizures of counterfeit goods in China occur regularly, but the profits on offer mean the imperative to keep counterfeiting is strong. In a raid which netted $6.3m worth of fake Blackmores and Swisse product last year, Guangdong police estimated the profit margin was 1000 per cent on products that were being sold for 50 per cent less than the retail price.