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Faux Luxury-The High Cost of Counterfeit Goods

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Faux Luxury-The High Cost of Counterfeit Goods

Category: Essay

Subcategory: Business

Level: College

Pages: 4

Words: 1100

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The High Cost of Counterfeit Goods
Counterfeiting luxury goods is a global problem, which is depriving the country billions of money. When people knowingly or unknowing are made to purchase a good that are not copyrights of the owner. It may lead to infringement of the laws that protect the people who have produced original work. Also because of counterfeiting products increase, governments have come up with intellectual property laws that are meant to protect people from counterfeits. People should know that it is not good for people to use counterfeit products as they have a lot of adverse effects on individuals, businesses and the nation as a whole.
Intellectual property is a section in the law that helps to protect the rights of the people who make original work. It protects everything from company identification symbols, original novels or plays, and inventions rights. The rights of intellectual property fall into four categories namely trademark, copyrights, patents and design rights. Trademarks involve words, name, slogan, symbol, design, or additional unique device, which can identify an organization or a product. Copyrights relate to recorded work in some way. Copyrights give authors rights over items such as artistic, literary, musical, topological arrangement, sound recording, filming, and drama work. It helps prohibit unauthorized action and allowing the author to pursue legal action in cases of plagiarism or infringement. Licensing is a process whereby one company gives another right to intellectual property such as to use patents or trademarks for some payment. Counterfeiting is a practice whereby people manufacture, import, export, distribute, sell goods that are of low quality with the intention to deceive that it is the original product. The counterfeits use trademarks that are similar to the original product, but the owner has not approved them. Piracy involves the process of reproducing and distribution of movies, books music, or any copyrighted item without getting permission from the original owner.
Using counterfeit products may become a risk to the consumer. The use of fake goods that are unsafe for human consumption may lead to deaths, injuries, and sickness. For example, according to a Congressional Hearing, on 1st November 2005 where the death of Ms. Maxine Blount was due to the use of counterfeit drugs (Lewis, 47-57). The woman had cancer, and the doctor had prescribed some medicine that she purchased from a legitimate, reputable pharmacy. However, the medicine was not responding as required that made a nurse take it for testing. The results of the analysis concluded that only five percent of the drug was the necessary substance. The medicine was the cause of Ms. Blount deteriorating health it also made the woman not be able to receive chemotherapy and eventually led to her death in 24th October 2002. Also, there are cases whereby the goods do not have any physical harm, but the consumers may be affected financially (Bamossy and Debra, 334-339). When people buy goods that are not functioning well or are of inferior quality and they cannot claim for a refund. Moreover, it makes the original manufacturers of the products to sell their products at a higher price since they have to recover the losses they make from counterfeit goods.
When people use counterfeit goods, they cause erosion on of the value of the brands product. When fake inexpensive, low-quality products are in abundance in the market, more people become deceived with the fake goods. It forces the market price of that particular brand to reduce (Seiter, 576-578). Also, some consumers may fail to use the product again because it did not meet their needs. Therefore, becoming a loss for the business since they would not be able to get revenue from that particular consumer. Besides, the fake product if they do not work correctly the customer may want the owner for the brand to compensate them since most goods have a warrant. If the owner of the brand fails to pay or refund money, the customer may decide to inform friends and family members (Lewis, 47-57). Therefore, making the business to lose more prospective clients in the future, since it is the people who buy a particular item, who quickly and easily market a product that gave them good service and the opposite when not handled well. If the business decides to compensate the customer, they lose the money from the sale of that particular product.
Companies also risk facing legal liability. When a client buys a product believing it is genuine and later become injured by using the product. They may decide to sue the brand owner. In some cases, the customer would request for payment for damage incurred from the brand owner. Also, the government may sue the brand owner for trying to avoid responsibility for the damage caused. Also, the business may be fined for not putting sufficient measures against anti – counterfeiting. The brand owner ends up losing a lot for the counterfeited items.
Counterfeiting harms the nation as a whole. There are no records for the counterfeited goods, which makes it very hard for the government to collect taxes from the products profits and sales (Seiter, 576-578). Assuming that the counterfeits goods were not in the market, people would have bought legitimate products from the owner. The tax money obtained from the sales would help fund different government projects. Also, counterfeit goods cost the economy of United States of America almost $ 250 billion every year.
However, the people who buy counterfeit goods may say that the prices of those products are lower than buying the original product. It is true because there are costs that the people involved in the counterfeit do not participate in such as paying for copyrights, they do not pay taxes and many more (Bamossy and Debra, 334-339). What these people forget is that cheaply is expensive. You may buy a good at a low price but end up being sick and using more money to get treatment.
People involved in counterfeit products do so because there is an improvement in technology whereby it is easy to reproduce and imitate other people’s products such as company’s trademark (Seiter, 576-578). It brings them quick revenue. However, the same people forget that not having permission from the trademark owner may make them face the law. It would be better for them to get a license from the owner instead of counterfeiting the goods.
Some people, on the other hand, use counterfeit products because they want to be in a particular social class as their friends. It is okay to have people you relate with and have similar interest, but this should not be the case if they are misleading a person to do things that are not right (Bamossy and Debra, 334-339). For example, if a person eats a certain meal because others are eating and it is cheap they may develop health issues, and the social class friends will not help them when they look for treatment.
The production of any counterfeit good is not legal for any country, because of the effects it has on individuals, businesses and a country as a whole. People would opt to buy cheap fake products because they do not have money to buy the original commodity but that is not right since there are consequences that may cost even their lives, sometimes the businesses may not compensate customers for damage, and many more. Companies face a lot of losses from the counterfeit’s production because they sometimes reduce their prices to be competitive in the market. Also, they may be sued for different reasons, and generally, counterfeits interfere with a countries economy. Therefore, people should not use counterfeit products
Work cited
Lewis, Kevin. “The Fake and the Fatal: The Consequences of Counterfeits.”The Park Place Economist 17.1 (2009): 47-58.
Seiter, A. “Health and economic consequences of counterfeit drugs.” Clinical Pharmacology & Therapeutics 85.6 (2009): 576-578.
Bamossy, Gary, and Debra L. Scammon. “Product counterfeiting: consumers and manufacturers beware.” Advances in consumer research12.1 (1985): 334-339.

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