Product packaging companies play an important role in protecting businesses and consumers from organized counterfeit operations. It's both an ethical obligation and a liability concern.
If you’re a packaging company, the one safeguard you need to accomplish this is certified product disposal.
Big brands and small brands alike trust you to deliver on your packaging promises to protect their brand's image in the eyes of the consumer, get their products to store shelves safely and reduce losses along the way. Successful product packaging companies understand the importance of ensuring proper labeling, engineering secure packaging and maximizing quality control at every step.
Yet increasingly, another threat faces product packaging companies and the brands they serve. According to the FBI, online copyright and counterfeiting schemes cost U.S. businesses over $6 billion a year. The FBI 2020 Crime Report named this type of fraud as a top concern, stating that these activities "threaten public health and safety."
How The Grey Market Is Impacting Companies Today
Certified product disposal for packaging companies helps you prevent the devaluation of your product, protect your brand image and packaging fraud. To understand the impact that certified product disposal has on the industry, it’s important to dive into what packaging companies are up against.
The grey market is a marketplace for sales not authorized by the manufacturer of a product. Unscrupulous or unaware resellers buy and sell what appear to be branded products. Instead, they may be knock-offs, recalls, non-functional returns or the like.
These products end up on online marketplaces like Amazon and eBay where they're sold for what appears to be a great deal for a new name-brand product, but buyers are often disappointed by what they receive.
To make matters worse, because consumers believe the product is from your client's brand, they now believe your client is the one producing inferior products and any reviews the consumer leaves about that inferior product become public record, tarnishing your client's brand. In turn, this impacts the brand's trust and future product sales. Online marketplaces have taken major steps to reduce this trickery that hurts both consumers and businesses. For example, in 2020, Amazon destroyed over two million counterfeit products in its possession.
But, it's an uphill battle as unscrupulous sellers continue to find ways to circumvent safeguards. To make matters worse, many brands are unaware this is happening and may even have business practices that make it easier for these individuals to continue their scheme.
How The Grey Market Operates
One of the major ways these schemers get around the crackdown is by repurposing custom packaging to make the products seem legitimate. But, how do unscrupulous characters get the branded packaging? The source could be any one of the following:
- Disgruntled employees
- An inside job
- An opportunistic person who happens to be at the right place at the right time
- Dumpster diving
- Non-secure transport
Product packaging companies like yours may discard packaging because of last-minute changes, misprints, recalls or other events. If this packaging isn't properly disposed of, then thousands of packages can end up in the wrong hands, driving this counterfeit industry.
Every type of packaging may be at risk, since the companies you package for often place their logos on several pieces, including:
- Corrugated boxes
- Custom packaging solutions
- Mailer boxes
- Tissue paper
- Larger custom boxes that hold many products
Without proper disposal for packaging companies, it's not hard for these branded packing materials to find their way onto the grey market.
The Products You Package Are Also At Risk
The actual product is also at risk. While products wait for workers to package them, a packaging company may receive word that the products must be destroyed. This can happen for a number of reasons, including:
- Undeclared allergens
- Safety recall
- Overstock decisions
People acquire products for the grey market in the same way they acquire packaging ... taking products intended for disposal.
Whether we're talking about food, nutritional supplements, cosmetics or electronics, these could present a serious risk to consumers if there is something wrong with the products themselves. That means you and your client could be held liable if a consumer is harmed and if there is evidence that you didn’t properly dispose of the product or its packaging.
Does your packaging company have a plan for disposal that would stand up to scrutiny and protect brands? Can you claim to be your client's ally in preventing the devaluing of their brand when acquiring new accounts? If not, brands will choose product packaging companies that can.
Yet many packaging companies have neither the means nor expertise to ensure proper disposal. That's where certified disposal for packaging companies comes in.
How Certified Product Disposal Fights The Grey Market
Certified product disposal companies ensure that all packaging and products destined for destruction is, in fact, destroyed. They provide you with authentication that gives you and the brands you serve confidence that the packaging and product aren't ending up in the wrong hands.
This form of disposal for packaging companies should be standard. Sadly, it isn't, so working with a certified disposal company is a great selling point when you're acquiring new clients.
A certified disposal company has a strict chain of custody and a plan for disposal of packaging or rejected products that you transfer to their possession. They'll present you with:
- A written plan
- Photographic or video evidence
- Paperwork and permits
- Certificate of destruction
Certified product disposal companies should also have 24/7 surveillance in their disposal yards so that any perpetrators found near the products can be dealt with before they can interfere with the items destined for disposal.
How To Find A Certified Product Disposal Company
Finding the right certified product disposal company for your business requires some homework and investigating on your part. However, there are some key attributes to look for in a company that will be responsible for guaranteeing any products or packaging in your possession are disposed of safely and legally.
When researching a certified product disposal company, make sure the business:
- Is certified, licensed and bonded
- Offers a detailed and transparent plan
- Provides evidence of destruction
- Offers assistance with manifest forms required for disposal
- Gives you a Certificate of Destruction form
Are you doing enough to ensure your client's packaging and products don't end up on the grey market? If you’re not sure, contacting a certified product disposal company can ease your worries and ensure your reputation as a packaging company stays intact.