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Case Study: Fast-Moving Consumer Goods

Brand protection solution to eliminate the diversion of products from legitimate distribution channels

The Challenge

A large, global hair care manufacturer produces category-leading brands with high consumer loyalty and demand. Their products are marketed through exclusive, professional beauty care channels via a complex supply chain with diverse manufacturing systems and multiple distribution outlets.

All of these elements make their products high-value targets for counterfeiters, organized theft rings, and gray market wholesalers. In fact, the manufacturer found they were being negatively impacted by diversion of its products from legitimate distribution channels into gray or retail markets. This situation was creating dissatisfied customers and weakening their market promotional efforts.

The Need

Clearly, the manufacturer needed an anti-diversion authentication solution that would help them maintain brand equity. It was imperative that the solution include the ability to authenticate product and verify its “product genealogy” throughout its life cycle. They also needed the ability to track product throughout their entire supply chain and make sure the right product was always delivered to the right location.

The Solution

The global hair care manufacturer turned to Authentix to implement an authentication solution of serialization and a track-and-trace system that identified product diversion in the brand’s distribution channels. The Authentix solution utilized multiple covert authentication features that allow item-level serialization, full product trace-ability from manufacturing to retail, as well as provisions to track repackaged products. In addition, the track-and-trace system was seamlessly integrated into manufacturing process controls for all of the manufacturer’s 13 production lines.

Itemized serialization was accomplished for over 165 million products, enabling full trace-ability from manufacturing to retail.

The Outcome

      • Successfully identified channel leaks within a complex distribution chain of over 2,500 channel partners and 15 distributors
      • Over 300 million units have been marked since the Authentix solution was implemented
      • 47 percent reduction in product diversion
      • Consequently, product sales increased by $77 million

Contact us if your company is struggling with lost revenue due to illicit activity throughout your supply chain.

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