The so-called “grey market” can save you cash, but could it cost you more in the long run?
Who doesn’t love a grey market? Not quite black, because they’re not underground or illegal, they are unofficial or parallel markets to buy gadgets and devices from overseas at lower prices than locally in Australia.
Also read: Hardware and software prices: Australia vs the US
Why people do it
Local, authorised resellers don’t like grey markets because shoppers can get brand products at a price below the regional price, so manufacturers apply warranty restrictions or highlight variable safety standards, restricted software upgrades or lack of English product manuals to dissuade consumers from going for a grey market item.
Regional market restrictions support differential pricing, something that consumers don’t like because you can’t shop for the best price across the board, despite the era of global trade. The government is taking a look at the issue
of Australians paying more for technology with a parliamentary inquiry and we await the outcome with interest.
Risks vs reward
The risks of buying grey market overseas are real: technical incompatibility and high cost for repairs if the device is sent back for service. If buying overseas, Australian consumer law won’t provide any warranty protection and your only recourse is to lodge a claim with the consumer rights office, if one exists, in the country of purchase.
Not to miss out on sales, some retailers are starting to sell imports through separate websites or by listing products marked as imports. This turns to the question of warranty and there is some protection for consumers when grey market items are sold through local retailers.
What about my warranty?
Manufacturers and suppliers are obliged under the law to provide consumer guarantees that include repair, replacement or refund depending on the item and the circumstances. If a local website sells a grey market import product then they must provide the same guarantee for these products. The Australian Competition and Consumer Commission says that importers give these same guarantees, even if the manufacturer does not have an office in Australia.
Consumers are free to seek a remedy from the supplier or the manufacturer. Suppliers may send the good to the manufacturer for diagnosis or repair, but they cannot require consumers to deal with the manufacturer directly.
At least one popular online tech retailer offers a one-year warranty on all its products so it’s assumed that this would include grey market products. Just watch out that you as the buyer aren’t deemed to be the importer to shoulder the cost of any repair.
A few brands seem to understand the desire for competitive pricing and have decided to match the authorised local prices with those of the grey market prices and emphasise the local warranty protection. This is a welcome development and other brands may follow suit to support local retailers and give consumers what they want with pricing and protection.
What about "international warranties"?
One thing that doesn’t often get much attention is that some manufacturers offer an international warranty. Some brand research shows that computing and technology companies such as Apple, Samsung, Canon, Dell and Lenovo to name just a few have international warranties. It means that if a product needs to be repaired outside of the country in which it was purchased, it can be taken to a local repair centre for service. It may be that the repair can take some time longer if parts are required to be sourced from overseas.
But don’t get too excited – some so-called international warranties are a traveller’s warranty in disguise. This is intended to cover products that need repair when someone is temporarily in another country. There are usually conditions such as it only applies if there are service centres in the country in which you’re travelling and there may be a limit. It also doesn’t apply in the country of purchase and won’t replace the local warranty.
The other drawback is that some brands control sales channels, making grey imports hard to find, so an international warranty is not as valuable as it might otherwise be. A true international warranty would allow products to be repaired or replaced in any location with a service centre, but this would mean true global shopping, and we’re a long way from that place.