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GREY MARKET - Coggle Diagram
GREY MARKET
Causes
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2. Blocked Distributions
Refer to the manufacturing companies blocked the distributors from selling their products; somehow they wish to sell the product and decided to get the goods from the grey market distribution.
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3. Price Competition
As the grey market usually is able to waive the overhead costs, hence they are able to create competitive advantage on the price level.
Those unauthorised reseller is able to offer any purchase of stock that the authorised reseller might fail to obtain, and sell it in a relevant low price level. The online reselling site has saved up lots of costs for the unauthorised reseller in order to enable them to offer a low price seduction to the intended clients. This has sustained the existence of the unauthorised selling sites for example Jomashop.com, Authenticwatches ,com which sells luxury watches in low prices (Shannon, 2017).(https://www.ft.com/content/4a4fc942-582d-11e7-80b6-9bfa4c1f83d2)
Definition
Known as the Parallel Imports. Conduct sales of legal goods through unauthorized distribution channel from the manufacturer. Grey Market distributors are for example: China's personal shoppers or "daigou".
There are many factors that sustained the grey market, and the most common are the four factors which consists of: Unavailable goods, Arbitrage, Convenience for consumers and Regulations in different countries.
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