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Manufacturers push the term "gray market" to imply that resold goods are somehow bad and people who sell them are participating in something like an illegal bla

Manufacturers push the term "gray market" to imply that resold goods are somehow bad and people who sell them are participating in something like an illegal black market. Reselling equipment is a normal part of doing business. There's nothing gray about it. There is no separate market for new products that have been bought from manufacturers and resold. It's just one market. We don't need to refer to something that doesn't exist, so we don't need a special term for it. The term "gray market" is linguistic manipulation to benefit manufacturers at the expense of customers, society, and the environment. Let's stop using the term. For products that have been used, we have a "second-hand market".

speleding 6y ago
In Europe there is indeed a market for new products that have been bought from manufacturers and resold right away, that's what's called a grey market. This happens because suppliers tend to use different pricing in countries with a different purchasing power, in order to extract more consumer surplus. It's not uncommon that if you buy the cheapest product in a webshop in Northern Europe you will find it has a Polish user manual when it arrives. It's not illegal to do that (although suppliers would probably like it to be). The same happens with servers, just compare USD and EUR prices on the Dell website.
- hvidgaard 6y ago
  It should not be considered a grey market. But it should be considered illegal to grossly vary prices inside the EU region. It's an extremely anti consumer practice and all it does is, as you say, extract more money from the consumers.
  - speleding 6y ago
    There actually are rules that say you cannot charge different prices depending on the location of the buyer, but suppliers trivially manage to circumvent that by making a tiny change and giving it a different SKU. Although I understand the sentiment, I'm not sure I would like additional legislation to try to prevent that. Even if you do manage to make that water tight the end result will probably mean higher prices for the consumers in countries with low purchasing power.
    - hvidgaard 6y ago
      At no point will the manufacture or distributers sell at a loss unless it's for strategical reasons. Perhaps the prices will go up in the countries with lower purchasing power, but it's bound to go down in the countries with higher purchasing power. That may or may not be intentional, but it's clearly possible to sell it at the low price, so they could just do that.
- Xelbair 6y ago
  It is called arbitrage in finance if i recall right. And what should be illegal is pricing things with such huge differences between regions in same market, or have the same brand's product have grossly different quality/composition between regions.
  - moonbug 6y ago
    why?
    - Xelbair 6y ago
      https://www.europarl.europa.eu/news/en/headlines/society/20171009STO85661/same-brand-lower-quality-meps-tackle-unfair-food-practices https://www.europarl.europa.eu/news/en/headlines/society/201... because it is exploitative? You use your brand, widely known, to sell inferior product for cheap. I would call it an 'official' counterfeit. Worst case - some of those inferior products were sold at higher markup!
- dangerface 6y ago
  > In Europe there is indeed a market for new products that have been bought from manufacturers and resold right away. These businesses are called suppliers there is nothing grey / illegal / dodgy about the business model of suppliers.
  - DanBC 6y ago
    Tesco lost a long court case in the UK about the right to buy and sell Levi jeans: https://www.theguardian.com/business/2002/aug/01/clothes.marketingandpr https://www.theguardian.com/business/2002/aug/01/clothes.mar...
- thelastname 6y ago
  Common market, hell yeah! And when they are "exporting" goods outside of Poland they get their VAT back(0% VAT). Really cute.
nabla9 6y ago
Definition of gray market Merrian-Webster: a market employing irregular but not illegal methods especially : a market that legally circumvents authorized channels of distribution to sell goods at prices lower than those intended by the manufacturer https://www.merriam-webster.com/dictionary/gray%20market https://www.merriam-webster.com/dictionary/gray%20market Investopedia: A grey market is a market in which goods have been manufactured by or with the consent of the brand owner but are sold outside of the brand owner's approved distribution channels—an activity that can be perfectly legal. In the securities markets, a grey market is a market wherein a company's shares are traded before they are issued in an initial public offering (IPO). https://www.investopedia.com/terms/g/greymarket.asp https://www.investopedia.com/terms/g/greymarket.asp Wikipedia: A grey or gray market (sometimes confused with the similar term "parallel market")[1][2] refers to the trade of a commodity through distribution channels that are not authorized by the original manufacturer or trade mark proprietor. Grey market products (grey goods) are products traded outside the authorized manufacturer's channel. https://en.wikipedia.org/wiki/Grey_market https://en.wikipedia.org/wiki/Grey_market Conclusion: Grey market seems to be the correct term.
- re-actor 6y ago
  The question is not "Does the term grey market have a meaning?" the question posed was "Is the use of the term perpetuating an unhealthy view of commerce to advantage manufacturers?". After you've been sold a product, the manufacturer has no authority on how you use it or where you resell it. Since the manufacturer doesn't have this authority they you can't be legally circumenvting authorized channels when reselling it. There is nothing "gray" about second hand.
  - myself248 6y ago
    I concur. If I bought a camera lens in New York and it came with a Malaysian manual and a warranty that's not valid in the US, but it's a genuine Canon lens, that's gray market. But if I buy a similar lens from the camera shop down the street, and it was originally sold in the US and the warranty is still valid in the US etc, it's a USED lens or a second-hand lens, but there's nothing gray-market about it. I think you're spot-on here; sources quoted in the article are misusing the term gray-market to simply refer to second-hand parts, which are something completely different. They want to make pre-owned parts sound just as shady, but the're not -- the first-sale doctrine would like a word.
jasode 6y ago
>Manufacturers push the term "gray market" to imply that resold goods are somehow bad [...] The term "gray market" is linguistic manipulation to benefit manufacturers at the expense of customers, society, and the environment. Let's stop using the term. From my experience reading manufacturers' warnings[1] about this, they never use the phrase "gray market" because a lot of consumers don't understand what that terminology means. It's more that the dealers/retailers and some savvy consumers use the phrase "grey market". There is a category of _new_ (not used) products that have the following attributes: - sold by unauthorized dealer : i.e. no contractual relationship with the original manufacturer to buy from them and then resell the item - sold without a manufacturer's warranty : any warranty must be honored by the unauthorized reseller or some other 3rd party or comes with no warranty at all So instead of the cumbersome long-winded hyphenated term of "unauthorized-retailer-and-no-manufacturer-warranty market", the industry just shortens it to "gray market". It's a useful label of what the product is. You're right, it's not unlawful or unethical to sell unauthorized/unwarranted merchandise as long you inform the customers. E.g. Most of the luxury watches sold on amazon.com (Cartier, Rolex, etc) are "gray market" because they don't come with manufacturer's warranty. If you buy a Cartier watch from Amazon[2] to save money and it's broken and needs repair, you can't take it into a Cartier retailer at the mall to have them fix it. There's nothing wrong with it as long as customers understand the tradeoffs of lower price vs service convenience. Even though the watches are genuine instead of counterfeit, they don't come with manufacturer's documentation to get factory-authorized service. [1] one example of a manufacturer warning about "gray market" without ever using that terminology: https://usa.yamaha.com/support/unauthorized_sellers/index.html https://usa.yamaha.com/support/unauthorized_sellers/index.ht... [2] https://www.amazon.com/s?k=cartier+ladies+watch&s=price-desc-rank https://www.amazon.com/s?k=cartier+ladies+watch&s=price-desc...
- mleonhard 6y ago
  In places with decent consumer protection laws (like California), manufacturers must honor warranties regardless of who you bought the product from. The term "unauthorized dealer" is another word to stop using. In a free market, everyone is authorized to buy & sell every safe product at all times.
dade_ 6y ago
Generally this is a reference related with channel partners, who are usually contractually restricted from selling used products or selling new products to other companies that intend to resell the product. For end customers, it is fine, except that enrolling in a new support contract from the manufacturer many have conditions or not be possible.
microcolonel 6y ago
Isn't buying goods to resell them just called retail ? Enabling retail is a massive part of U.S. property and commercial law, this is how Blockbuster was able to do business.
oliwarner 6y ago
Grey markets might not be a real, standalone market, but they do describe real side-effects of a non-conventional supply chain. Take grey market cameras. They're are often bought as kits from Asian markets, broken up into lenses and camera bodies and sold on "as new" in western markets but with no support direct from eg Nikon if it goes wrong. Warranty support is from the reseller only. They may ship your unit back to China for support, or repair/replace it at their cost. So no, these are important differences for customers to recognise. Let's keep using it.
- dangerface 6y ago
  > they do describe real side-effects of a non-conventional supply chain. Thats just the thing they don't there is nothing unconventional about suppliers acting as middlemen and setting their own price. To pretend this is a problem is unconventional and anti consumer.
  - oliwarner 6y ago
    No, that's not fair. Most of the products that get imported this way also have local service centres that fulfil warranty claims. The labour is more expensive and often part of a different regional company than the import or manufacturer. I wouldn't import a Ford truck from the US and expect a local Ford garage to meet its warranty obligations here in the UK. There are extraordinary things to consider for the consumer. A label like "grey market" helps. It's not a slight. It's just quicker and easier than saying "this was imported from a distribution channel in another country and will only be serviced in that country".

speleding 6y ago

In Europe there is indeed a market for new products that have been bought from manufacturers and resold right away, that's what's called a grey market. This happens because suppliers tend to use different pricing in countries with a different purchasing power, in order to extract more consumer surplus. It's not uncommon that if you buy the cheapest product in a webshop in Northern Europe you will find it has a Polish user manual when it arrives. It's not illegal to do that (although suppliers would probably like it to be). The same happens with servers, just compare USD and EUR prices on the Dell website.

hvidgaard 6y ago
It should not be considered a grey market. But it should be considered illegal to grossly vary prices inside the EU region. It's an extremely anti consumer practice and all it does is, as you say, extract more money from the consumers.
- speleding 6y ago
  There actually are rules that say you cannot charge different prices depending on the location of the buyer, but suppliers trivially manage to circumvent that by making a tiny change and giving it a different SKU. Although I understand the sentiment, I'm not sure I would like additional legislation to try to prevent that. Even if you do manage to make that water tight the end result will probably mean higher prices for the consumers in countries with low purchasing power.
  - hvidgaard 6y ago
    At no point will the manufacture or distributers sell at a loss unless it's for strategical reasons. Perhaps the prices will go up in the countries with lower purchasing power, but it's bound to go down in the countries with higher purchasing power. That may or may not be intentional, but it's clearly possible to sell it at the low price, so they could just do that.
Xelbair 6y ago
It is called arbitrage in finance if i recall right. And what should be illegal is pricing things with such huge differences between regions in same market, or have the same brand's product have grossly different quality/composition between regions.
- moonbug 6y ago
  why?
  - Xelbair 6y ago
    https://www.europarl.europa.eu/news/en/headlines/society/20171009STO85661/same-brand-lower-quality-meps-tackle-unfair-food-practices https://www.europarl.europa.eu/news/en/headlines/society/201... because it is exploitative? You use your brand, widely known, to sell inferior product for cheap. I would call it an 'official' counterfeit. Worst case - some of those inferior products were sold at higher markup!
dangerface 6y ago
> In Europe there is indeed a market for new products that have been bought from manufacturers and resold right away. These businesses are called suppliers there is nothing grey / illegal / dodgy about the business model of suppliers.
- DanBC 6y ago
  Tesco lost a long court case in the UK about the right to buy and sell Levi jeans: https://www.theguardian.com/business/2002/aug/01/clothes.marketingandpr https://www.theguardian.com/business/2002/aug/01/clothes.mar...
thelastname 6y ago
Common market, hell yeah! And when they are "exporting" goods outside of Poland they get their VAT back(0% VAT). Really cute.

nabla9 6y ago

Definition of gray market Merrian-Webster: a market employing irregular but not illegal methods especially : a market that legally circumvents authorized channels of distribution to sell goods at prices lower than those intended by the manufacturer https://www.merriam-webster.com/dictionary/gray%20market https://www.merriam-webster.com/dictionary/gray%20market Investopedia: A grey market is a market in which goods have been manufactured by or with the consent of the brand owner but are sold outside of the brand owner's approved distribution channels—an activity that can be perfectly legal. In the securities markets, a grey market is a market wherein a company's shares are traded before they are issued in an initial public offering (IPO). https://www.investopedia.com/terms/g/greymarket.asp https://www.investopedia.com/terms/g/greymarket.asp Wikipedia: A grey or gray market (sometimes confused with the similar term "parallel market")[1][2] refers to the trade of a commodity through distribution channels that are not authorized by the original manufacturer or trade mark proprietor. Grey market products (grey goods) are products traded outside the authorized manufacturer's channel. https://en.wikipedia.org/wiki/Grey_market https://en.wikipedia.org/wiki/Grey_market Conclusion: Grey market seems to be the correct term.

re-actor 6y ago
The question is not "Does the term grey market have a meaning?" the question posed was "Is the use of the term perpetuating an unhealthy view of commerce to advantage manufacturers?". After you've been sold a product, the manufacturer has no authority on how you use it or where you resell it. Since the manufacturer doesn't have this authority they you can't be legally circumenvting authorized channels when reselling it. There is nothing "gray" about second hand.
- myself248 6y ago
  I concur. If I bought a camera lens in New York and it came with a Malaysian manual and a warranty that's not valid in the US, but it's a genuine Canon lens, that's gray market. But if I buy a similar lens from the camera shop down the street, and it was originally sold in the US and the warranty is still valid in the US etc, it's a USED lens or a second-hand lens, but there's nothing gray-market about it. I think you're spot-on here; sources quoted in the article are misusing the term gray-market to simply refer to second-hand parts, which are something completely different. They want to make pre-owned parts sound just as shady, but the're not -- the first-sale doctrine would like a word.

jasode 6y ago

>Manufacturers push the term "gray market" to imply that resold goods are somehow bad [...] The term "gray market" is linguistic manipulation to benefit manufacturers at the expense of customers, society, and the environment. Let's stop using the term. From my experience reading manufacturers' warnings[1] about this, they never use the phrase "gray market" because a lot of consumers don't understand what that terminology means. It's more that the dealers/retailers and some savvy consumers use the phrase "grey market". There is a category of _new_ (not used) products that have the following attributes: - sold by unauthorized dealer : i.e. no contractual relationship with the original manufacturer to buy from them and then resell the item - sold without a manufacturer's warranty : any warranty must be honored by the unauthorized reseller or some other 3rd party or comes with no warranty at all So instead of the cumbersome long-winded hyphenated term of "unauthorized-retailer-and-no-manufacturer-warranty market", the industry just shortens it to "gray market". It's a useful label of what the product is. You're right, it's not unlawful or unethical to sell unauthorized/unwarranted merchandise as long you inform the customers. E.g. Most of the luxury watches sold on amazon.com (Cartier, Rolex, etc) are "gray market" because they don't come with manufacturer's warranty. If you buy a Cartier watch from Amazon[2] to save money and it's broken and needs repair, you can't take it into a Cartier retailer at the mall to have them fix it. There's nothing wrong with it as long as customers understand the tradeoffs of lower price vs service convenience. Even though the watches are genuine instead of counterfeit, they don't come with manufacturer's documentation to get factory-authorized service. [1] one example of a manufacturer warning about "gray market" without ever using that terminology: https://usa.yamaha.com/support/unauthorized_sellers/index.html https://usa.yamaha.com/support/unauthorized_sellers/index.ht... [2] https://www.amazon.com/s?k=cartier+ladies+watch&s=price-desc-rank https://www.amazon.com/s?k=cartier+ladies+watch&s=price-desc...

mleonhard 6y ago
In places with decent consumer protection laws (like California), manufacturers must honor warranties regardless of who you bought the product from. The term "unauthorized dealer" is another word to stop using. In a free market, everyone is authorized to buy & sell every safe product at all times.

dade_ 6y ago

Generally this is a reference related with channel partners, who are usually contractually restricted from selling used products or selling new products to other companies that intend to resell the product. For end customers, it is fine, except that enrolling in a new support contract from the manufacturer many have conditions or not be possible.

microcolonel 6y ago

Isn't buying goods to resell them just called retail ? Enabling retail is a massive part of U.S. property and commercial law, this is how Blockbuster was able to do business.

oliwarner 6y ago

Grey markets might not be a real, standalone market, but they do describe real side-effects of a non-conventional supply chain. Take grey market cameras. They're are often bought as kits from Asian markets, broken up into lenses and camera bodies and sold on "as new" in western markets but with no support direct from eg Nikon if it goes wrong. Warranty support is from the reseller only. They may ship your unit back to China for support, or repair/replace it at their cost. So no, these are important differences for customers to recognise. Let's keep using it.

dangerface 6y ago
> they do describe real side-effects of a non-conventional supply chain. Thats just the thing they don't there is nothing unconventional about suppliers acting as middlemen and setting their own price. To pretend this is a problem is unconventional and anti consumer.
- oliwarner 6y ago
  No, that's not fair. Most of the products that get imported this way also have local service centres that fulfil warranty claims. The labour is more expensive and often part of a different regional company than the import or manufacturer. I wouldn't import a Ford truck from the US and expect a local Ford garage to meet its warranty obligations here in the UK. There are extraordinary things to consider for the consumer. A label like "grey market" helps. It's not a slight. It's just quicker and easier than saying "this was imported from a distribution channel in another country and will only be serviced in that country".