Counterfeit Goods: Impacts on Consumers and the Economy

We all like to feel like we are getting value-for-money in anything we purchase, but sometimes a bargain can leave us feeling cheaper than expected when it turns out to be a counterfeit, sub-standard imitation of the real thing. Questions are raised about the multiple perspectives involved in the operation of the movement of these illegal products and how societal roles and conforming to pressures contribute to the damage being done to individuals and the economy as a whole.

According to Retail Economics, the total value of UK retail sales in 2018 was £381bn, with an average annual growth of 15% in online sales in the same year. As the consumer moves towards online services, so too have the trading operations of suppliers of counterfeit and substandard goods who previously plied their wares from fold-up tables in marketplaces and street corners.

This movement online has not only anonymised the process for the sellers of these goods, but has also served to raise questions about why consumers will resort to buying from unauthorised and risky suppliers.

Why do people knowingly choose counterfeit goods?

Two researchers from the Beijing Technology and Business University have investigated the relationship between group motivation, ego and unethical behavioural intention from a broader perspective, looking at the potential driving factors for being complicit in these often- illegal activities. Their findings indicate the collective adoption of a ‘no-harm, no-foul’ mindset in which the consumer does not explicitly see the impact of their involvement in the criminal activity, and as a result, they are more likely to participate. However, many will likely be involved in the purchasing of counterfeit and sub-standard products without being aware of the situation.

With additional pressures from society to conform to standards of beauty and through the perpetual bombardment of images which extol the false image of perfection via social media channels and through popular culture, it is inevitable that those within society without the resources to achieve these ideals through legitimate means are turning to alternatives to do so.

Fashion and beauty trends evolve over time, as do expectations for the consumer to adapt to them, and it seems that little that can be done to alter this. However, questions need to be asked regarding the damage that can be caused by purchasing ‘knock-off’ goods online, even under the guise of ‘just saving money’.

Online Shopping Fraud

According to the Consumer Harm Report (2018), published by the National Trading Standards (NTS) for the UK, their eCrime team uncovered potential online fraud of £59m. This work focussed specifically on several areas, including online shopping fraud. The report served to highlight the dangers faced by the consumer through fraudulent activities carried out on the world wide web. Yet, this figure merely represents visible fraud and presents only the tip of the iceberg. Reports suggest that fraud cost consumers approximately £14.8bn in 2014-15 alone.

Research from the Anti-Counterfeiting Forum estimates that the proliferation of counterfeit goods has resulted in a cost of £30bn (or the equivalent of 14,800 jobs) for the UK economy. Even more startling, the 2018 EU Customs Report estimates that of all counterfeit border seizures, 34% had the potential to harm consumers.

Increased Seizure of Counterfeit Goods

The seizure on counterfeit goods has increased by 9% on previous annual figures and may suggest two possibilities – that border control teams are becoming increasingly effective at the identification and seizure of such items, or alternatively, that those dealing in fake goods are taking increased risks with regards to public safety.

The ‘no harm, no foul’ mentality surrounding counterfeit culture still puts consumers at genuine risk. Many do not even realise that they have purchased counterfeit goods, thereby unwittingly putting their loved ones and themselves at risk.

Risks of Counterfeit Goods

Counterfeit goods can pose serious risks to the health and safety of those purchasing the items, and to others, such as family members, including children that ultimately use these products.

Often untested and produced to a lower-quality standard than legitimate items, there are many potential hazards associated with counterfeit goods –

  • Counterfeit fragrances and cosmetics may contain harmful chemicals that may cause skin irritation, burning or even permanent disfigurement if applied to the skin.
  • Counterfeit toys and children’s products may contain high levels of chemicals such as boron, and present choking hazards with loose buttons, stuffing, and small parts.
  • Counterfeit electrical goods can be made with poor quality components that present fire risks, as well as limiting the lifespan of the products.

What to watch out for

Consumers can avoid unknowingly purchasing counterfeit goods by –

  • Only purchasing goods from reputable suppliers and websites.
  • Checking the contents of products for unusual ingredients or high levels of dangerous chemicals – if unsure, do not purchase.
  • Checking packaging for manufacturer stamps and stickers – if at all unsure, do not purchase / use these products
  • Looking for evidence of product testing and the standards / levels to which the products have been tested (usually UK and European Standards – e.g. for cosmetics – ‘Regulations (EC) No. 1223/2009’ or the Kitemark with ‘ISO 9001:2015’ for safety items). Avoid untested and unregulated products.

Supply and Demand

Where there is a demand, inevitably, the supply will follow. Ultimately, questions need to be asked of both the online traders and their motivations, and the changing moral values and societal pressures placed on people, that are potentially increasing the demand for cheaper items from dubious sources. What we can do is limit the damage by avoiding knowingly purchasing counterfeit items. By identifying fraudulent practices and subsequently reporting traders, progress can be made. are working in partnership with Vistalworks to bring you the very latest innovation in consumer protection technology. Their Simple Query Tool allows you to copy and paste a URL from sellers websites such as Amazon and eBay before making an online purchase, providing an indication of whether the product appears to be legitimate or not. This can be found by visiting and entering the URL.

If you believe you have been sold counterfeit or substandard products and need more advice on the matter, you can contact on 0808 164 6000. We are open 9am-5pm, Monday-Friday.

You can follow us on social media – Twitter: @advicedotscot , Instagram: and Facebook:, or get ahead by visiting out knowledge centre at