Schaeffler in the fight against product piracy: The GS1 Data Matrix code as a key technology – Image: Xpert.Digital
From counterfeit protection to the digital twin: Why Schaeffler's small code has a huge future
Dangerous counterfeits: How a simple code becomes a powerful weapon for industrial giant Schaeffler
As a technology and industrial group, the Schaeffler Group has developed a comprehensive and systematic approach to combating product counterfeiting, in which the GS1 Data Matrix code plays a central role. This technological solution is far more than just a simple barcode – it forms the foundation for a holistic strategy for counterfeit protection and digital traceability.
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The challenge of product piracy in industry
Product piracy is a growing problem for industrial companies like Schaeffler, extending far beyond traditional luxury goods. Rolling bearings and other machine components are particularly affected, as they are often safety-critical and their failure can have serious consequences. Counterfeit industrial components not only endanger operational safety but can also lead to production downtime, damage, and, in the worst case, personal injury.
The quality of counterfeits is unpredictable and does not meet the strict standards required for industrial applications. Even if an initial shipment of counterfeit products initially appears functional, there is no guarantee of long-term reliability or compliance with technical specifications. Furthermore, the similarity between the original and the counterfeit often makes it significantly difficult to distinguish with the naked eye.
The GS1 Data Matrix Code as a key technology
To combat product counterfeiting, Schaeffler relies on the GS1 Data Matrix Code (DMC), which has been applied to all product packaging for years and, increasingly, directly to the products themselves. This two-dimensional code encrypts a wide variety of information and seamlessly identifies every single product worldwide.
The DMC used by Schaeffler is based on the internationally recognized GS1 standard and is ECC200 compliant. This standardization ensures that the codes are uniquely legible worldwide and that no overlaps can occur. The code contains a Global Trade Item Number (GTIN) for product identification and a unique serial number that allows each individual product to be uniquely identified.
The technical properties of the DMC make it particularly suitable for industrial applications. It can store a large amount of information in the smallest of spaces and, thanks to its error-correction algorithms, remains readable even if up to 30 percent of its surface is damaged. This robustness is crucial in industrial environments where codes are exposed to dirt, heat, abrasion, and other environmental influences.
The OriginCheck app as a verification tool
A central component of Schaeffler's anti-counterfeiting strategy is the OriginCheck app, which was launched in 2017 and has been continuously developed since then. This smartphone application enables end customers, dealers, and authorities to quickly and easily perform an initial authentication check on INA and FAG products.
The app works by scanning the DMC on the product packaging or on the product itself. After scanning, the user immediately receives feedback on the authenticity of the code. This involves a query against a database maintained by Schaeffler, which records every code delivered. The app uses a traffic light system to indicate to the user whether the code is authentic or suspected of being counterfeit.
For suspicious results, the app offers a guided photo documentation feature that allows users to take pictures of the suspect product and email them directly to the Schaeffler Brand Protection Team. This feature significantly simplifies the reporting of suspected counterfeit cases and enables rapid processing by experts.
The OriginCheck app goes beyond pure product verification and offers additional features such as dealer certificate verification and a search function for authorized distributors. This allows buyers to verify not only the authenticity of the products but also the authenticity of their sources.
The Brand Protection Team as a central coordination point
Since 2004, Schaeffler has operated a specialized Brand Protection Team, which serves as a central point for combating product and brand piracy. This team has a comprehensive arsenal of measures to combat counterfeiting and works closely with customs and law enforcement authorities.
The team pursues a multi-dimensional strategy encompassing legal, organizational, and public relations measures. These include civil and criminal proceedings against counterfeiters, active market surveillance, cooperation with authorities, and awareness-raising and training measures for retailers and customers.
The success of this strategy can be measured in concrete figures. In 2017 alone, Schaeffler investigated over 700 suspected cases and was able to seize and destroy counterfeit goods with a retail purchase value of five million euros worldwide. In one case from 2023, as many as 30,000 counterfeit rolling bearings were destroyed, most of which had been seized in Europe in the previous two and a half years.
Technical implementation and serialization
The technical implementation of the DMC at Schaeffler follows a well-thought-out concept that ensures both product safety and traceability. Each code is generated individually and may only be used once. This uniqueness is a fundamental prerequisite for ensuring that every product can be unequivocally identified as a genuine Schaeffler product.
Serialization follows a structured scheme in which a serial number in block 21 of the GS1 code contains a timestamp in the form of the day and time the code was generated. By linking it to other internal information in the Schaeffler data infrastructure, each code can be traced back to the place of its creation, i.e., to the factory level.
This traceability not only enables Schaeffler to identify counterfeits but also to capture detailed information about production batches, manufacturing dates, and distribution channels. This data is crucial for both quality control and product monitoring.
Direct Part Marking for permanent marking
A particularly important aspect of Schaeffler's strategy is Direct Part Marking (DPM), in which the DMC is lasered directly onto the product. This method ensures that the marking remains available even if the original packaging is removed or damaged.
DPM is particularly advantageous in industrial applications where components are often in use for years or decades. Direct laser engraving withstands extreme environmental conditions and remains legible even after millions of hours of operation. This is particularly important in the rail, aerospace, and automotive industries, where complete traceability throughout the entire product lifecycle is required.
The combination of DMC on the packaging and DPM on the product itself creates double security. Both codes are linked, allowing users to access the same authenticity information via both channels. This increases verification flexibility and makes the system more robust against tampering attempts.
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How GS1 Standards Make Supply Chains More Secure and Efficient
Integration into digital supply chains and Industry 4.0
At Schaeffler, the DMC not only serves to protect against counterfeiting, but also forms the foundation for the digitalization of the entire supply chain. The unique labeling of each product lays the foundation for the development of digital twins and their integration into Industry 4.0 concepts.
Capturing the DMC enables track-and-trace functionality at the individual part level, which goes far beyond mere authenticity verification. In outbound logistics, serialized handling units such as pallets and cartons can be linked to the product codes, enabling seamless tracking throughout the entire supply chain.
This data capture also supports the remanufacturing of Schaeffler products, as all relevant data throughout the product lifecycle is available. With a single scan, operators and remanufacturing companies can gain complete access to order status, remanufacturing information, and the life cycle of each individual bearing.
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Logistics applications and smart box system
Schaeffler is continuously expanding the application possibilities of the DMC in logistics. One example is the Smart Box system for large-scale warehouse applications, introduced in 2021. These reusable transport containers are equipped with GPS trackers and enable precise tracking throughout the entire transport process.
The integration of DMC and GPS technology creates new opportunities for monitoring and optimizing logistics processes. Location and environmental data are collected in real time and can be used to improve delivery schedules, reduce downtime, and optimize return processes.
This development demonstrates how the DMC has evolved from a simple authentication feature to a comprehensive information carrier for intelligent logistics systems. The data from the trackers enables data-driven management of delivery and return logistics and contributes to sustainability by ensuring optimal use of reusable containers.
Quality management system and technical compliance
The implementation of the DMC is closely linked to Schaeffler's comprehensive quality management system. The SHAPE (Sharpen, Accelerate, Perform) quality program, introduced in 2021, integrates divisional and central quality aspects and leverages the resulting synergies for continuous improvement.
A key component is the Technical Compliance Management System (TCMS), which encompasses standardized and auditable processes for product safety and compliance. This system includes management systems for integrated product safety, functional safety, and product cybersecurity management, all of which aim to minimize technical risks posed by the increasing connectivity of products.
The integration of the DMC into these systems ensures that anti-counterfeiting is not viewed in isolation, but as an integral part of the overall product safety strategy. This is especially important in times of increasing regulatory requirements and the growing complexity of industrial products.
Digital transformation and future prospects
Schaeffler is using the DMC as a springboard for more far-reaching digitalization measures. The technology collaboration with NVIDIA for the development of digital twins demonstrates how traditional marking technologies can be integrated into modern Industry 4.0 concepts. In NVIDIA Omniverse, all elements of Schaeffler's production are mapped and simulated as digital twins.
Schaeffler Digital Solutions GmbH is developing innovative solutions for the factory of the future with the autinity software platform. These web-based applications utilize the data provided by the DMC for condition monitoring, quality assurance, and traceability functions along the entire supply chain.
The company plans to integrate at least half of its factories into the digital ecosystem by 2030. The DMC will play a key role as a link between physical products and their digital representation. This integration will enable real-time monitoring, analysis, and continuous optimization of production processes.
International cooperation and standardization
Schaeffler is actively involved in international committees and organizations dedicated to advancing anti-counterfeiting and product safety. The company initiated the Product Safety Network, which now comprises thirteen companies and is supported by the VDA, VDMA, and ZVEI trade associations.
At the EU level, Schaeffler has been participating in the steering committee for the development of the Enforcement Database of the European Union Intellectual Property Office (EUIPO) since 2013. Through this database, rights holders provide European authorities with product information and contact details to facilitate the detection of counterfeits and the initiation of countermeasures.
The OriginCheck app is accessible in this database with accompanying information for authorities and is demonstrated at joint events. This international collaboration enhances the effectiveness of the individual measures and contributes to the development of industry-wide standards.
Economic impact and success measurement
The investments in counterfeit protection and DMC technology are paying off for Schaeffler in several ways. In addition to providing direct protection against revenue losses due to product piracy, the measures also contribute to strengthening brand reputation and customer trust.
The concrete successes can be measured using various key performance indicators. Around 90 percent of the products currently delivered by Schaeffler are already marked with a DMC. The Brand Protection Team processes hundreds of suspected cases annually and regularly removes significant quantities of counterfeit products from circulation.
The system's preventive effect is particularly important. The mere existence of a robust authentication technology like the DMC significantly increases the costs and risks for counterfeiters. Since each code is only valid once, counterfeiters would have to copy a different valid code for each counterfeit package, which represents an enormous effort and significantly increases the risk of detection.
AI and training as key to combating increasing product piracy
Despite the success of DMC-based counterfeit protection, challenges remain. The increasing professionalization of counterfeiters requires continuous development of security features and verification methods.
Schaeffler is addressing these challenges through continuous innovation and improvement of its systems. The integration of artificial intelligence into its analysis processes enables the detection of even sophisticated counterfeiting attempts. At the same time, the user-friendliness of its verification tools is being continuously improved to increase acceptance among end customers and dealers.
Another important aspect is training and raising awareness among all stakeholders in the supply chain. Schaeffler offers regular training sessions for authorized dealers and provides comprehensive information materials to raise awareness of the problem of product piracy.
Future-proof anti-counterfeiting: Schaeffler's holistic DMC approach
Schaeffler's implementation of the GS1 Data Matrix code represents an outstanding example of a holistic approach to anti-counterfeiting that goes far beyond mere product labeling. By combining technical innovation, strategic planning, and international collaboration, the company has created a system that not only addresses current threats but also lays the foundation for future developments in the digital industry.
The success story of DMC at Schaeffler demonstrates that counterfeit protection is most effective when understood as an integral part of a comprehensive digitalization strategy. The technology not only protects against plagiarism but also enables new business models, improved customer services, and more efficient production processes.
Schaeffler plans to further expand and deepen its use of DMC in the future. Integration into IoT systems, use for preventive maintenance concepts, and integration into automated quality management systems will further increase the importance of this technology. At the same time, the continuous development of security features and verification methods will ensure that Schaeffler can continue to offer effective protection against product counterfeiting.
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