Buying Counterfeit Merchandise

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One of the books I started reading recently is titled Hot Property : The Stealing of Ideas in an Age of Globalization, which is all about counterfeiting and how it affects… well, basically everything. The books starts off by throwing a bone to the fake Rolex’s and Louis Vuitton bags, then delves into how it affects you (airplane part manufacturers selling parts not to spec, re-dated perishables like rubber, etc), how pervasive counterfeiting is, etc. Well, this brought me to thinking about Chinatown, NY and the sale of counterfeit products. Would you buy something that’s fake?

Here’s how it works if you want to buy a fake purse or shiny thing in Chinatown… you go down to Canal Street in Manhattan and nine times out of ten, someone will approach you and drop a brand’s name (Tiffany? Louis? Prada?). If you’re interested, you’ll perk up and look at them. They’ll flash out a catalog (or a large semi-glossy page) of products with prices listed underneath. If you say yes, you basically follow them down an alley to a back room where they’ll have boxes full of this fake stuff.

The alternative is you walk to one of the storefronts, preferably one of those incredibly narrow and deep stores that already sells Proda, Lovis, and Tiffony’s (Po1o is popular too) stuff anyway and is “not quite” counterfeit. Walk up to the guy running the show and ask him if he or she has other, better purses. They’ll look at you and probably will take you back into a room. It’ll be behind a pseudo false door (the walls are all slotted so you can hang stuff off them, the one in the back simply opens up to the storeroom) and the tiny room will be PACKED with cardboard boxes. He/she will show you a few purses, haggle briefly, and either you’ll buy it or they’ll shuttle you out.

I’ve actually never bought a fake purse (I don’t carry a purse and its ridiculously bad form to give it as a gift to a girl when you’re a guy, but somehow awesome if you’re a girl giving it to a friend though, it’s a horrible double standard!) but I’ve been on many a trip to the nebulous black market of high end accessories. I would say most people don’t realize how easy it is to get counterfeit products in the States (everyone knows of the $1 DVD movies or $10 for Microsoft Office 2003 in Hong Kong, but that requires a trip to Hong Kong and some sweating in customs)… so would you buy a fake purse if it meant chopping 80-90% off the price?

Also, from what people tell me, quite often when you go to Asia and see products really cheap, it’s not because the products are counterfeit but because they are stolen. With all the production in Asia, often times the workers steal a few to sell. Either way, it’s still illegal stuff. Incidentally, I wrote this article because I thought people would find it an interesting read on how simple the infamous “NY Chinatown black market” is and this isn’t meant as a guide or anything to help you buy illegal goods. Since it is illegal, you could get in serious trouble for buying stolen goods or counterfeit products.

{ 12 comments, please add your thoughts now! }

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12 Responses to “Buying Counterfeit Merchandise”

  1. In chicago, some of the purse parties are like this (they have whatever crap the person is selling and then some of the counterfeit stuff). Also, you can get it on the street (they carry this stuff in duffle bags). My sister has purchased a couple of these. I don’t think I would.

  2. John says:

    On 60 Minutes, a seller of these items in Italy said that rich people buy the fakes from him. Average people are in the stores buying the real stuff. Why? Rich people are smart and want to save money since they get the prestige of having the real thing since they know that no one will challenge them. Regular people want to look rich, but others will always wonder whether their stuff is fake.

    It’s all an illusion. People, things and information.

  3. Illusion-of-the-Mind says:

    When is the last time anyone spent $20 for a crystal clear DVD …when the sell them for $5 on any major city street.

    In America like it or not…the middle man has gotten filthy rich of the backs of many. Why should I pay my GM/ or Honda Dealership $75 per hour to fix my car, when I can get their mechanic to do the same work for 50% of the dealers cost and cutting out the middle man?? The car still rides the same, but my pockets sure do feel different.

    Walmart didn’t get to be number one by ingnorance on their purchasing decisions. Neither should you.
    It’s your money…….

  4. John says:

    Whoa! There’s a big difference in cutting out the middle man than cutting the legal owner of the brand who made the item. You are advocating buying illegal stuff from the street man selling bogus DVDs. There’s a lot of people hurt in that transaction.

    You’re mixing apples with oranges. The situation of seling bogus DVDs on the street is more like selling stolen stuff on the street than comparing it to Walmart selling things. People may get a bargain by buying stolen things but there are victims here.

  5. Illusion-of-the-Mind says:

    Perhaps my DVD illustration is mixing apples and oranges here in the states, but the little guy is all but totally left out of the transaction except to ‘service’ (prep, merchandise, sell, ect) the product.

    Yes there are victims in this scenario, but what about the normal business model…how many people were victimized by price fixing, price gouging ect?

    CD’s were selling at almost $16-20 in some stores….Isn’t it funny how they all of of a sudden dropped to about $10 to compete with the counterfieter?

    No I don’t advocate doing anything illegal, but again….It’s your money

    Thank goodness for Ebay, and other sites where people can deal directly with each other for goods and services.

  6. John says:

    “Yes there are victims in this scenario, but what about the normal business model…how many people were victimized by price fixing, price gouging ect?”

    Not normal. These acts are illegal conduct. No one advocates their use. They will be prosecuted if they get caught.

    “CD’s were selling at almost $16-20 in some stores….Isn’t it funny how they all of of a sudden dropped to about $10 to compete with the counterfieter?”

    No, it isn’t funny because the next step from cutting costs is true bankruptcy, in which case no one will get anything new because the artist or inventor won’t provide these items without pay.

  7. jim says:

    I think illusion’s point of the middleman (distributor) is true, they make a tremendous amount of money. Distributors (music labels) are necessary in a free market economy because the producers (musicians) don’t have the capability, the network, or the funds to be able to provide their products to as many consumers as a distributor is able to. The downside is that in the past distributors have taken advantage of musicians because of their contracts (musicians are at an obvious disadvantage in negotiations, they’re typically starving and need their “big break”) so it’s easy to laud counterfeiters are taking down the big bad wolf, but that’s not the answer.

    The answer has been developing for years as intelligent artists (Jay-Z for one) create their own record labels with fair deals for their musicians.

  8. John says:

    There’s he goes again. Illusiion is mixing apples and oranges. The topic is counterfeiters merchandise, and somehow he’s justifying it by talking about cutting the middleman. That’s a whole other issue entirely. Jim, maybe you can write an article about that someday to satisy his anger about it.

  9. Illusion-of-the-Mind says:

    Sorry John…..No anger here, just stating my opinion. If there weren’t distributerships to promote artists, the artists would find a way to get their music heard. Trust me…

    Ask Master P (Southern Rapper) how many years did he sell his own music out of the trunk of his car before he signed on with a major label.

    Ask Prince why did he stop his “lucrative” deal with Warner Bros. to distribute/promote his own music.
    It’s about control, nothing more. The little man wants his/her fair share.

    As far as mixing apples and oranges, the monkey’s been off my back for years. This is a global economy and the cheapest guy wins…

    Perhaps your gripe should be with the way our business model are structured and why they continue to out source labor to foriegn countries but expect Americans to pay the same or higher costs.

    Is it any wonder why companies continue to go offshore?? Ask any employee at Stanley why the company went offshore to Bermuda. Ask GM’s 25,000 employees being laid off.

  10. Tool Man says:

    Counterfeiters are criminals plan and simple. I pretty much guarantee you that they aren’t going to win any employer of the year award. Honestly, I don’t want to see cheaters and criminals getting wealthy. I don’t want to validate what they are doing by buying any of their merchandise.

  11. Yoda J Bean says:

    Illusion-of-the-mind wrote:

    “Walmart didn’t get to be number one by ingnorance on their purchasing decisions. Neither should you.”

    Are you phucking kidding me? Walmart number one? Walmart is the biggest peddler of counterfeit merchandise, this side of the free world. I purchased some Fruit of the Loom sweat shirts and they fell apart for the second time. So this time, instead of returning them to walfart, I sent them to Fruit of the Loom. Their response? We didn’t make these!

    Oh the irony, sweat shirts made in sweat shops!

    Perhaps, illusion-of-the-mind, you should change your name to delusion-of-the-mind.

  12. JohnT says:

    A different perspective on buying counterfeit goods.

    Often quoted is a loss to the US of 200 billion dollars, which I doubt is real. Most likely this is the retail value of those counterfeits if they were purchased as real brands. However, since people who could never afford nor pay for the real item purchase the majority of those goods, they don’t hurt the seller nearly as much as they claim. What person buys a $400 wallet or $1000 purse, only those to whom have a very high net worth and want the status of owning a brand name. If someone in China or Thailand buys a fake Prada, they couldn’t afford to buy the real thing.

    Counterfeiter goods can actually help the real owners of the brand in certain situations in several ways. By preventing legitimate competition from emerging, if I can buy a counterfeit that is 98% as good as the original, then why buy another unknown brand? And by popularizing the brand with the masses who if they couldn’t buy counterfeit would buy some other brand.

    Poor countries get a leg up by buying counterfeit goods like software, the USA did the same thing in our history before we were the dominate world economy.

    Taken from Wikipedia. In America, Edison had been working on copies of the original light bulb patented by Swan, trying to make them more efficient. Though Swan had beaten him to this goal, Edison obtained patents in America for a fairly direct copy of the Swan light, and started an advertising campaign which claimed that he was the real inventor. Swan, who was less interested in making money from the invention, agreed that Edison could sell the lights in America while he retained the rights in Britain.

    Counterfeit goods proliferate for only one reason; they can be produced much cheaper. If the goods were a copy that is 98% indistinguishable from the original, then I would contend in 50% of the cases the ordinals are selling for too high a price. Now in the case of soft goods such as music or computer software or drugs, I would say develop costs have to be amortized and the inventor should make a profit. But if the product is priced reasonably, then most consumers will pay extra for the real brand. Many designer brands are quite deliberately priced with extremely high margins.

    The same can be said of tax systems, if taxes get too high, it encourages tax evasion schemes. There is a balance that has to be maintained, and when that balance gets too far on one side or the other, there are consequences such as counterfeit goods.

    This is not to say counterfeit goods should not be illegal, and certainly if allowed to proliferate uncontrolled it would eventually destroy the original investors of the product. Just that I can see both sides of the debate, and I wouldn’t get morally upset at the situation Keep it under control is what I advocate.

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