Grey Market - Description

Description

Grey-market goods refer to "legal goods" which are sold outside normal distribution channels by companies which may have no relationship with the producer of the goods. Frequently this form of parallel import occurs when the price of an item is significantly higher in one country than another. This situation commonly occurs with electronic equipment such as cameras. Entrepreneurs buy the product where it is available cheaply, often at retail but sometimes at wholesale, and import it legally to the target market. They then sell it at a price high enough to provide a profit but under the normal market price. International efforts to promote free trade, including reduced tariffs and harmonized national standards, facilitate this form of arbitrage whenever manufacturers attempt to preserve highly disparate pricing. Because of the nature of grey markets, it is difficult or impossible to track the precise numbers of grey-market sales. Grey-market goods are often new, but some grey market goods are used goods. A market in used goods is sometimes nicknamed a green market.

Importing certain legally restricted items such as prescription drugs or firearms would be categorized as black market, as would smuggling the goods into the target country to avoid import duties. A related concept is bootlegging, the smuggling or transport of highly regulated goods, especially alcoholic beverages. The term "bootlegging" is also often applied to the production or distribution of counterfeit or otherwise infringing goods. Grey markets can sometimes develop for select video game consoles and titles whose demand temporarily outstrips supply and the local shops run out of stock, this happens especially during the holiday season. Other popular items, such as dolls can also be affected. In such situations the grey market price may be considerably higher than the manufacturer's suggested retail price. Online auction sites such as eBay have contributed to the emergence of the video game grey market.

Read more about this topic:  Grey Market

Famous quotes containing the word description:

    As they are not seen on their way down the streams, it is thought by fishermen that they never return, but waste away and die, clinging to rocks and stumps of trees for an indefinite period; a tragic feature in the scenery of the river bottoms worthy to be remembered with Shakespeare’s description of the sea-floor.
    Henry David Thoreau (1817–1862)

    An intentional object is given by a word or a phrase which gives a description under which.
    Gertrude Elizabeth Margaret Anscombe (b. 1919)

    The next Augustan age will dawn on the other side of the Atlantic. There will, perhaps, be a Thucydides at Boston, a Xenophon at New York, and, in time, a Virgil at Mexico, and a Newton at Peru. At last, some curious traveller from Lima will visit England and give a description of the ruins of St. Paul’s, like the editions of Balbec and Palmyra.
    Horace Walpole (1717–1797)