Tequila Sauza Against Piracy

What does Sauza do to decrease the piracy of products?

There are four main activities that Tequila Sauza carries out in order to fight our customers getting pirate products and thus, avoid health problems or having our products' image damaged:

1. We work along with the State and chambers.
2. Use of new technologies
3. Well defined processes regarding internal security
4. Collaboration with our clients

1.- Working along with State-Industry

In June 2015, the federal government and the wine and liquor industry signed a collaboration agreement to fight the illegal trade of alcoholic beverages, since it represents 43 percent of the total market and causes millions of tax losses.

The Secretary of Public Finances, Luis Videgaray Caso, informed that the agreement between the Tax Administration Service (SAT) and the wine and liquor industry is an extension of a similar agreement that was signed on February 2014 with the Tequila Regulatory Council.

In the signing of the agreement and the launching of the campaign "Together against illegality", he stressed that this joint effort between the government and the private sector aims to strengthening legality, empowering citizens through the use of new technologies.

In this regard, he explained that as of 2014, the badges and labels on imported wines and liquors, as well as on national ones, certify their legality and have traceability, since by means of an application installed on a smartphone, their authenticity can be verified.

He stressed that the telecommunications reform is accelerating the inclusion of new technologies "that give the citizen the power to, in this case, verify the legality of the products he acquires", such as wines and liquors.

Another reference tells us that "the market for illegal alcoholic beverages in Mexico stands at 187 million liters, which in turn represent 43 percent of illegality in the total market", which agrees with the first reference mentioned.

"This figure in the total alcoholic beverage market is not a minor issue, so it requires that all the formal industry and the government join in a crusade that allows us to choose the most effective and forceful actions to combat this evil."

This situation hits the public finances of the State hard, because of the tax evasion and the lack of fulfillment of fiscal obligations, which is why, the commitment of the wine and liquor industry is to continue collaborating against illegality.

The support of the federal government is also important to them, since only by way of the Special Tax on Production and Services (IEPS) in the industry, the loss in taxes amounted to more than 6,300 million pesos in 2014.

Among the main actions, truthful, clear and timely information will be disseminated so that it motivates consumers to denounce suspicious and illegal business practices. Likewise, strategic operations will be strengthened in collaboration with the tax and health authorities that allow the elimination of illegal products.

2.- Use of new technologies

The effort and collaboration that the authorities are making to eliminate or decrease piracy by means of the use of new technologies, include strategies such as:

• Creation of labels made with special paper
• Specific designs and QR codes that will reassure the client that he is buying an original product
• Being able to get all the product's information they'll buy with the use of a smartphone

All these strategies are designed to keep delinquents from selling pirate products.

Tequila Sauza cooperates by acquiring specialized machinery that helps in getting all the information of its production with more efficiency and speed, so this information can be sent in turn to the corresponding legal authorities in order to make sure that the all legal labels placed on each bottle have al the information that clients need. By doing so, when clients scan the QR code, they can:

• Read all the information about the product they're about to taste (tequila in this case)
• Have a certainty of the origin of the product's manufacturing.

3.- Well defined processes regarding internal securit4.- Collaboration clients-company

We must say that the use of new technologies isn't enough, having a well-defined supply, production, destruction and logistic process is needed in order to achieve:

• The correct handling of raw materials
• An adequate use of them in production
• The destruction of product with defect

All of the above is done in order to safely deliver a high-quality finished product to our clients.

This is why Tequila Sauza has been mapping in detail each of the processes of design, purchase, production, and distribution up to the products' final destination. By doing so, we:

• make sure we've applied the best practices regarding security at critical points of the entire supply chain
• give our clients the certainty that they will receive a high-quality product, safely and directly from the plant.

Finally, and most importantly, we have the collaboration with our clients, which means creating a plan that includes the following aspects:

• Communication. - Share all the features and details that make our products unique by brand and that must be kept in mind in order to make sure that: 1) the product that our clients are acquiring is actually manufactured by us, that 2) they can be sure that they are tasting a high-quality product that cares about their health
• Cooperation. - Ask our clients to participate with the destruction of bottles and boxes used for product delivery to avoid re-use, as well as with suggestions and the spreading of information on the characteristics of our products in order to help taking care of the citizen's health by means of the responsible consumption of safe and high-quality products.
• Complaints. - Asking our clients to denounce the findings of any product that doesn't comply with the characteristics shared by the manufacturer so that authorities can immediately remove all those products from the market which can cause health damage and affect the good procedures of Tequila Sauza.
• Ethics. - Empower customers with complete product information so that, following their own ethics, they always decide to purchase branded products in order to guarantee satisfaction and safety.
• No to piracy and contraband. Make all the necessary propaganda in order to sensitize the population to say NO to piracy and contraband, as well as to help them understand all the negative effects that these illicit activities represent to the population. (See below: Negative effects)
• Recycling. - Make an even bigger emphasis on the support and spreading of information about recycling campaigns in order to: recover all those raw materials that are used in our products; ensure their destruction and; prevent them from reaching criminals so that they aren't filled up with liquids that could damage the population's health.
• Stick to the normative framework. - Tequila Sauza, as a socially responsible company, attached to its comprehensive secure and safe product delivery policy, will always work with strict adherence to the laws and regulations of the country in order to guarantee our customers that they will always receive a safe and good-quality product with its safety guarantee.

Negative effects of piracy

• • Damage in the population's health due to the use of low-quality materials
  • Discourages investments to the industry
  • It inhibits the generation of new sources of well paid employment
  • Reduces competitiveness as an economic sector
  • It generates violence in the country for trying to gain markets

  For all the reasons above, Sauza is committed to keep working against this common evil that affects the whole community in general: piracy.

  If you'd like to know more about our tequila production processes, feel free to come to Casa Sauza and learn all about them on-site.

One of our readers asked a few questions after reading this blog post. Click on this link to read all about it!

Tequila Sauza contra la piratería (Parte 2)

• Bibliography:

  • Federación y la industria de vinos y licores van con todo contra bebidas piratas
  • http://intoleranciadiario.com/detalle_noticia/134526/nacional/federacion-y-la-industria-de-vinos-y-licores-van-con-todo-contra-bebidas-piratas.
  • http://www.arturocamposcedillo.com/Firman-convenio-el-SAT-y-el-CRT-contra-el-tequila-pirata,386_5
  • https://www.dineroenimagen.com/2015-06-30/57770
  • http://www.elfinanciero.com.mx/empresas/85-de-los-clientes-moviles-en-mexico-usan-smartphonesS