Wal-Mart Counterfeit Problem

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Most analysis of online retail counterfeit sales focuses on the e-commerce giants. That means figures get pointed at Amazon.com Inc. (NASDAQ: AMZN) and eBay Inc. (NASDAQ: EBAY). However, despite the size of its brick-and-mortar empire, Wal-Mart Stores Inc.  (NYSE: WMT) has one of the largest online retail businesses in the world. That means counterfeit products have become a major challenge.

Some say Wal-Mart has not done enough to check the abuses. According to The Counterfeit Report:

Walmart has a counterfeit problem. Both Walmart, and third-party sellers Walmart allows to list on Walmart’s website, are selling counterfeit products.

Walmart’s global name recognition and consumer perceived credibility is a significant advantage in marketing (and profiting) from unaware consumers. Buyers place their confidence in, and rely on Walmart’s credibility to purchase authentic goods. Sometimes that confidence is misplaced.

Unknown to many consumers, Walmart allows outside third-party sellers to list and sell products on Walmart’s website. Alarmingly, counterfeit products appear right next to authentic items conveying Walmart’s endorsement and the illusion they are from Walmart.

The Counterfeit Report goes on to give examples of fake memory cards.

All the major e-commerce sites have methods whereby counterfeits can be reported, and supposedly removed. Critics say these are little more than band-aides because the number of counterfeit goods on sale at any given time stretches into the thousands. The e-commerce sites do not have the capacity to police such a significant problem, at least at a level they are willing to afford. The wider issue is whether they have an obligation to do so. For the time being, “buyer beware” at Wal-Mart’s online operations, at least.