Entrepreneurs work hard to come up with new or improved products. They desire to expand market territories, deliver better products and stand out as the leading brands steer enterprises to new heights of innovation. They compete fiercely to ensure that they are the number-one consideration for any potential customer the market has. Particularly, start-up enterprises find it hard to venture into the market because they often have to pitch their products against the best brands. Attempts to overcome the stifling competition can compel many start-ups to resort to unfair competition. Sometimes, this happens without the knowledge of the business proprietor. The following discussion will help you understand unfair competition when running a start-up enterprise.

Defining Unfair Competition

The most difficult of running a start-up business is establishing your brand in the market. Establishment, in this context, refers to the power of persuading a consumer to shift from their traditional purchase and buy a new product or service that hasn't been in the market. The difficulty involved in carrying out this persuasion can push you to the edge, forcing you to resort to deceptive or wrong selling practices. This is unfair competition. Unfair competition describes practices that mislead the consumer and harm other businesses, leading to business disputes with either party.

Common Practices in Unfair Competition

Unfair competition happens in several ways. Understanding some of these practices will help you prevent the litigation from happening in the first place. Here are the common practices in unfair competition:

• Brand substitution: Brand substitution happens at the manufacturing or packaging stage. The perpetrator of the unfair competition uses trademarked images, logos, symbols or slogans on their products to act as bait for consumers. The practice also goes by the name 'bait and switch'.
• Misuse of Trade Secrets: This involves using secret procedures, recipes or additives to make your goods taste or look similar to those of your competitor.
• False representation of service or product qualities: Making false claims about the benefits of using your product or service also amounts to unfair competition. For instance, do not claim to sell cholesterol-free cooking oil if your product contains a small percentage of cholesterol.

Remedies Availed By Courts

Unfair competition is a form of dispute classified under business tort. Courts offer a number of remedies to the infringed party. First, the court may ask you to pay damages (monetary compensation) that are commensurate to the loss incurred by the person you infringed. It can also issue an injunction. This is an order directed to the perpetrator of a crime, asking them to cease from the tortious act with immediate effect.

For more information, contact a small business dispute resolution lawyer.