What is Grey Importing
If you have ever bought something online which has come from outside Australia, you have most likely taken part in the online shopping phenomenon that is known as Grey Importing. It is no secret Aussies pay more for products than the rest of the world and thanks for the online shopping boom, the avenue now exists to combat this sort of price inflation.
What exactly is Grey Importing
Also known as Parallel importation, Grey importing refers to products that are imported and sold outside of normal retail distribution channels by companies or individuals which may have no relationship with the producer of the actual goods.
- An individual like yourself can be the grey importer if you buy from outside of Australia.
- Local Retailers can also be Grey importers if they source their stock from overseas retail channels
When you grey import, you are effectively buying in to a different regional market bypassing any local distribution restriction. Prices set in Hong Kong for example, are often lower than prices set in Australia – this makes it a common region to parallel import from.
Items such as Video games, Electronic equipment, Cameras, mobile phones and computer components are very popular withing the grey import market due to the incredible savings that can be had.
Why Does it sound illegal?
International distributors and producers often enter into exclusivity agreements in the Australian localised market and often go to great lengths to protect local retail distribution; it’s not just about revenue but also retail brand recognition, basic bragging rights and the ability to control the local market itself. At the end of the day though, exclusivity distribution agreements never benefit the consumer.
In 2000 the Australian Government resolved to remove parallel import restrictions from a range of products except cars and followed this up with legislation making it legal to source music and software CDs from overseas and import them into Australia. An Australian Productivity Commission report recommended in July 2009 that legislation be extended to legalise the parallel importing of books, with three years’ notice for publishers.
Dispute what else you may be told, Grey Importing is definitely not illegal with the only limitation being that of the product itself such as importing a banned product.
Any product over $1,000 (including postage and insurance) is theoretically liable for GST. Specific importation fees and fines may be added onto this by Customs. See Importing goods by Post.
Why does traditional Distribution cost more?
Ironically there isn’t much difference between traditional retail distribution and Grey Importing. The biggest factor separating the two is the Market itself. It is worth noting that Grey importing can benefit both the shopper and the Merchant due to traditional retail distribution being tightly controlled with Grey importing operating more like an open market.
Disadvantages of Grey Importing
- Australian warranties and consumer rights may not be honored, and can be difficult to contest.
- Regional Restrictions – both hardware and software.
- Power supplies for electronic goods commonly need adapters.
- Software on physical media may be incompatible due to region restrictions (Console Games, Blu-Ray)
Advantages of Grey Importing
- Cheaper Prices.
- More variety of products
- Products are released months before they are commonly available in Australia.
Some Popular Grey Importing Retailers you may know