Grey Market Goods
Should I Be Concerned?
The Grey Market Encompasses A Lot Of Goods In A Lot Of Channels.
|Grey Market Goods - Licensed goods where the origin, authenticity, or method of distribution is in question. This has become a major problem with apparel and footwear. The worse we have ever seen it. Unauthorized factory overruns, back door deals, knock offs, and more. Buying and selling them can result in civil and criminal penalties. It doesn't matter if they are authentic or not. If they did not come from an authorized factory distributor or a department store which is usually an authorized distributor you have exposure. Be extremely cautious when purchasing straight brand lots especially from small distributors. Many claim authenticity but that means nothing. Look for goods with complete paperwork from the manufacturer or licensor or at least department store overstock which is generally assumed authentic and marketable subject to the restrictions of the department store.|
|Counterfeit Goods - Knock offs, fakes, whatever you want to call them. You can get in all kinds of trouble if you deal in these.|
|Authentic Goods - This one gets a lot of play. Forums, chat rooms, web sites, experts, all kinds of checks to run products through to see if they are authentic or not. In the long run it doesn't really matter because if licensed products are obtained from an unauthorized distributor you are still can be exposed to civil and criminal liability. It's not how they look it's who you got them from. Many manufacturer's post their authorized distributors on their web sites. If you are in doubt why not call the manufacturer and ask if the distributor trying to sell you licensed goods is an authorized distributor of their products.|
|You can get in just as much civil and criminal trouble for selling licensed goods distributed outside authorized channels as you can for selling knock offs. It's not worth the risk. Stay with department store products or products with original paperwork to hold the risk factor to a minimum.|
|Department Store Products - Probably the safest form of products we know of that do not come with original manufacturers paperwork. Many department stores sell their salvage/surplus products with some restriction on their resale that can involve delabeling or defacing logos and price tags especially on private label goods. The non private label goods are generally more valuable that the private label goods. You are generally granted the right to re-sell the products subject to the restrictions of the department store. Most department stores are assumed to deal in authentic products. The retail tags on the products help prove their good source.|
|Original Paperwork - The best form. Paperwork that comes from the manufacturer / licensor of the goods. A copy of this from an authorized distributor would be good too.|
|Sanitized Invoice - A document showing the legal trademark of the licensor of the product with the proprietary paperwork (price, date, contact information) whited out. A description and breakdown of the products is disclosed on the sanitized invoice. A broker or re-seller would try to prove authenticity with this. You could have problems with this since it is not original paperwork.|
|Authorization to Sell - A document issued by the licensor of a product granting the receiver the right to sell the product. A distributor or broker could also issue this but it would not necessarily have the same effect if it does not come from the licensor.|
|Statement of Authenticity - Not too powerful if it doesn't come from the licensor of the product. Some distributors claim authentic goods in their invoices or claim to have statements of authenticity to provide their customers if they have problems. The distributors and their suppliers are not really in a position to guarantee authenticity unless they are the original manufacturer or an authorized distributor. We don't place much stock in a Statement of Authenticity. Ask for original paperwork.|
|VERO - eBay's Verification of Owners Rights Organization. This is a group of companies that provide information when they feel their intellectual property rights have been violated. Many of these companies do not like to see their products sold on eBay which undercuts their normal retail distribution channels. Some have employees and computer programs that search for their products daily looking for violations. The apparel, footwear, and accessories companies are especially active. If one of these companies sees one of your listings and they believe there is a violation, they contact eBay and your listing can be pulled. You will be asked for documentation that your products are not violating intellectual property owners rights. If you can't produce the documentation, you are probably out of luck. You could have a lawsuit arise as well. This is why we are not big fans of grey market goods.|
|We have provided these definitions to help you understand certain aspects of our industry. Some of the content includes opinions. The definitions should not be considered an absolute statement of fact. You should consult with legal council or the appropriate governmental or trade authorities for complete facts.|
Stay Away From Grey Market Goods. It's Not Worth The Risk.