The IP War: How to Stop Your Factory from "Leaking" Your Custom Designs

You have a winning design. It’s unique. It’s proprietary.

You send the Tech Pack to a factory overseas.

Three months later, you find your exact product—same shape, same texture, maybe even your logo blurred out—selling on a discount marketplace.

This is not a coincidence. This is a supply chain leak.

In my years in this industry, I have seen brands destroyed by this. The leak usually doesn't happen out of malice; it happens out of negligence or a factory trying to squeeze extra profit from existing tooling.

If you are sourcing custom components (like complex 3D moulds), you are vulnerable.

To protect your brand, you need more than trust. You need a 3-Layer Defense Strategy. Here is how we execute it at CCA, and how you should demand it from any supplier.

 

Layer 1: The Financial Defense (Mould Ownership)

 

This is the most common mistake brands make.

The Trap: A supplier offers you a "Free Mould" or a very cheap mould fee amortized over a large order.

The Reality: If you don't pay for the mould explicitly, you don't own it. The factory retains ownership. This means they legally have the right to use that mould for other customers. That "generic" shape you see on the market? It was likely someone else's custom design that became a "public mould" because they didn't buy it.

The CCA Protocol: We separate the Mould Cost (Tooling Fee) from the Unit Price. When you pay for the mould, it is your property. We tag it with your unique ID. We contractually agree that this tool will never be used for another client without your written permission.

 

Layer 2: The Physical Defense (Scrap Destruction)

 

Where do the "rejects" go?

In manufacturing, there is always waste. Maybe the color was slightly off. Maybe there was a bubble.

The Trap: Unscrupulous factories sell these "seconds" or "overruns" to grey-market traders by the kilo. These traders then list them online.

The Reality: Your "rejects" are still your IP.

The CCA Protocol: We implement a strict "Grind and Destroy" policy for branded goods.

• Any product with your logo that fails QC is not thrown in a bin.

• It is put through a mechanical shredder or granulator within our facility.

• It is reduced to raw unrecognizable particles before it leaves our building.

• We can provide video evidence of destruction for sensitive IP projects.

 

Layer 3: The Legal Defense (The NNN Agreement)

 

Most brands ask for an NDA (Non-Disclosure Agreement). That is a good start, but often not enough for manufacturing in Asia.

You should look for the principles of an NNN Agreement:

1. Non-Disclosure: We won't tell anyone your design details.

2. Non-Use: We won't use your design/moulds for our own benefit or for other clients.

3. Non-Circumvention: We won't go behind your back to sell directly to your customers.

The CCA Protocol: We sign binding IP protection agreements with our clients. More importantly, we enforce these strict rules with our own sub-suppliers (e.g., raw material providers) to ensure the entire chain is secure.

 

Your Questions Answered: IP Protection FAQs 

1. What is the difference between an NDA and an NNN Agreement? An NDA (Non-Disclosure Agreement) focuses on keeping secrets (not talking). An NNN (Non-Disclosure, Non-Use, Non-Circumvention) is broader and stronger for manufacturing. It specifically prohibits the factory from using your moulds to compete with you or selling your product to others.

2. Can I patent my custom badge design? Yes, you can often apply for a Design Patent (in the US) or Community Design (in the EU) which protects the visual shape and ornamentation of your accessory. However, this is a legal process distinct from manufacturing. We recommend consulting an IP lawyer. From a manufacturing side, owning the mould is your immediate protection.

3. How do I audit a supplier for IP security without visiting? Ask them two questions:

• "Can you send me a photo of your scrap shredding machine?"

• "Can you confirm in writing that I hold 100% title and ownership of the moulds after payment?" Their reaction to these questions will tell you if they are serious about IP.

 

The Final Word

 

Your Intellectual Property is your competitive advantage.

Do not trade it for a slightly cheaper unit price or a "free mould."

Work with partners who understand that protecting your design is just as important as producing it.

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About the Author

August Lin is the VP of Sales and Co-founder of CCA.

With over a decade of experience in manufacturing, he has helped global brands secure their supply chains against leaks and counterfeiting. He believes that physical protocols, not just paper contracts, are the key to real security.

Connect with August on LinkedIn.