Spooks in the rag trade

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Spooks in the rag trade

One industry that needs to deal with economic espionage is the fashion industry. Obviously, once a design hits the showroom it is easy for competitors to copy it. (Any legitimate – and some illegitimate – buyers get to see the designs.) But in the fashion industry, as in most other industries, the problems start much earlier. And the earlier a competitor can get your designs, the more likely you are to see your designs introduced by your competitors. The fashion industry is subtly different from other industries, in that in many cases the habit of design theft is so endemic that it is almost assumed to be the norm. Even so, there are three primary sources of loss. The first is an employee who moves from company to company, taking design information with him. A variation of this is a current employee who takes the design to a small production house, has samples made, and then has someone else take the samples to the buyers. In either case – employee or ex-employee – your design is sold before it hits your showroom.

Another area of leakage is an employee being bribed by competitors to sell your designs. As happens in many companies, the fashion industry is one in which people lower-down on the food chain are paid relatively modestly, put in long hours, and get no overtime. While the combination of wanting more money combined with resentment at what could be perceived as poor treatment might not induce employees to commit criminal acts, it might at least incline them not to report competitors who try to bribe them, particularly if there is no company policy on this issue.

A third area of leakage is out and out pilfering – people simply walking in and stealing. We have been in companies where there was no access control, and anyone could – and apparently sometimes did – simply walk in and take or copy anything they wished to have. We will not even discuss here the issue of tradesmen and cleaners who are given unfettered access to both designs and samples left unattended, and design documents that are discarded unshredded with no thought whatsoever as to their value. There are a number of things that can be done to reduce the level of theft, none of which are unique to the fashion industry. The easiest to deal with includes the obvious steps of putting in sensible access control, having clauses in contracts which deal with this issue, shredding design documents and drawings rather than throwing them out, and making sure you know your employees, suppliers, and contractors.

That done, the normal OPSEC process will allow you to identify what information needs to be protected, and from whom. When you know what needs to be protected and from whom it needs to be protected, you can start deciding who should be able to see it (and who shouldn’t) and when they should see it (and when they shouldn’t). In addition, you can also put in the appropriate countermeasures to protect the designs from outside theft, as well as dealing with the issue of insider theft.

Keep in mind that until your designs hit the showroom, they are trade secrets. As such, if you take reasonable and appropriate steps to protect them, their theft is covered by The Economic Espionage act of 1996. This means that you can, if necessary, bring the Feds in to help when designs are stolen. However, we race to point out that it is much better to keep them from being stolen in the first place. OPSEC is a process that could substantially reduce loss within the fashion industry, and with so little disruption and at such low cost as to go almost unnoticed. However, OPSEC is pretty much unknown in the industry, and so we expect to see losses continue unabated.

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