Sunday 15 June 2014

Counterfeit Street, Manchester – a High Street underworld revival?

                                                                                                                             Pic: The Sunday Mirror
Investigators from The Sunday Mirror have discovered that, behind the locked doors of Bury New Road, in a maze of back alleys and basements, a new trade is flourishing – fake designer goods worth millions of pounds change hands here every year.

See details and pics here.

It’s a hidden shopping mall and cash-and-carry all rolled into one, a secret outlet village where rogue traders buy fake supplies in bulk and sell them on across the country. Young men - the spotters - lurk on street corners outside the locked shutters of closed-down shops. These men are the spotters. They bring customers in and keep police out.

The process raises big issues:
Apart from illegality, if someone can buy designer-fake for £20, take a gross margin of 43% by selling it on for £35, a retail price still far below that of the genuine article, what is the impact on consumer perception of brand-value?

In other words, if fake and genuine products are almost functionally similar, or at least close enough to satisfy consumer need, there will be a limit to the premium that consumers will be prepared to pay for a branded product that is certified as genuine…

This means that the only effective way to reduce the appeal of designer-fakes will be to reduce retail prices to levels that equate more closely with functional realities, especially in flat-line markets…

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