How Can Trade Secret Theft Affect Companies ?  

When there is a trade secret involved then it is the top secret of the company. People who work for the company and if they come to know about the trade secret are not allowed divulging the information s per the non disclosure agreement. This is allowed only when the NDA has been signed with the employees.

The trade secret may be the key factor on which the company runs on. A trade secret will affect the company’s business itself. If someone else gets to know it, then they can set up the same type of business and become their competitors. A company has a trade secret, it means that it has no competitors that give the same output and the quality of their product, the product of the company can be very unique.

Even if employees know about it they can start their own company based on the same concept. Losing the trade secret is like losing intellectual property. However, that is the only information on which the company is dependant on running its business. This is common in the food and beverage industry. This type of incident once happened with Pepsi when their competitors came to know about their new product and soon Coke designed the same product and launched it first.

This happened in India and both the companies got into a legal battle and pulled their businesses out of India as a result. Such incidents are not common and the trade secret is highly guarded information and very few people like the management or the person who started the company knows about it.

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Trade-Secret-Definition      Trade Secret is the type of information that a company keeps as a secret, so that they have an edge over their competitors. One of the biggest trade secret in the history of the business world is the formula for coca cola. Even today, people do not know why coke tastes different. Even the formula for Pepsi is a trade secret and despite being competitors, they do not taste the same though they are alike in several ways. More..

 


 

 

 
   
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