Sunk costs are sunk. A truly competitive market wants you to operate at the marginal cost of production. The only way to recover R&D costs is through protecte

Sunk costs are sunk. A truly competitive market wants you to operate at the marginal cost of production. The only way to recover R&D costs is through protected IP, with my personal preference being brands and trademarks. Fashion is not protected. That's why it changes so quickly. If you can't come up with new and appealing designs every day, you will die in that industry, because the knock-off copies are being made the day after they ship, at the latest. If you have a valuable brand and poor security practices, there might be copies on the market from the day after your design reaches the factory. But the legal knock-offs will not have your brand labels in them. The problem is trademark infringement. It isn't copies, but counterfeits. Here's the money quote from the article: "Detecting and combating counterfeiters is not easy," said Monks. "Many are operating out of countries where prosecution may be impossible, and that gives them the confidence to flaunt their products on image-driven social platforms such as Instagram. Taking action against their accounts is digital whack-a-mole; the counterfeiter generally has dozens more accounts already created and ready to activate in order to avoid disruption to their trade." So... caveat emptor. Without a global convention on trademark protection that heavily punishes incoming trade from non-member nations, the burden is on suppliers to devise anti-counterfeiting measures that allow consumers to determine at the point of sale whether a product is genuine or not.