With a no-deal Brexit looming, Stuart Farr estimates the difficulties we might be presented with from an old trade enemy, the grey import.
The story (or at least a version of it) so far…
A long time ago, a nation of people garnered their votes and declared they didn’t want to be part of a bigger tribe of nations any more. The decision divided the people but eventually they elected a leader whom they believed would see them through these troubled times.
With a powerful mandate in hand, he blustered loudly and banged his fists and told the people they would leave the big tribe at the end of 2020…”come what may!” And then all went quiet.
As if in retribution, a deadly pestilence descended on the people and the Leader was forced to confine them to their homes. All was done with terrifying haste—the people had no time to buy even a toilet roll or a bag of pasta on the way. The streets and skies lay empty.
For months the people, in their collective hysteria, reacted by drawing rainbows and clapping together loudly on their doorsteps. They soon forgot about the vote and their big tribe neighbours in favour of simple survival.
Of course the people were not aware that a select few civil servants had been locked away in a room with their big tribe counterparts. With nothing more than a few sharpened pencils and a direct line to Deliveroo, they were tasked with reaching a settlement.
The room was sealed and forgotten about until recently when the word emerged that talks were still ongoing. An optimistic soul even suggested “we’re nearly there”. Very few heard the message and even fewer believed it.
As the second wave of pestilence took its toll the people sighed and cursed about the dreadfully bad timing of it all. The people of business, however, became greatly concerned for they had suffered badly at the hands of the disease.
They searched for ways to survive. Several time-served businesses recalled the experiences of the 1990’s and thought: “Hmm. Grey Imports… maybe that’s an answer to our problems.”
To be continued…
As a 90’s throwback myself, I distinctly recall the outcries generated by the words “grey imports” during that decade. At least for a while, grey imports did upset the status quo. Consumers (initially) loved them. Businesses in the UK, however, tended to loath them.
A grey import is a loose term used to describe a product that is legally imported from another country or sold through channels other than the manufacturer’s official distribution network or systems. This can be done for a variety of reasons.
Firstly, the seller concerned may not have been able to obtain an official appointment to the distribution network from the manufacturer but still wishes to sell the product in question in order to meet local demand.
Also, grey imports often seek to take advantage of different pricing mechanisms that exist in different localities—hence why it was generally possible to buy a “grey” product cheaper than from your local official dealer.
Often the equivalent of the VAT would be deducted. In other respects the pricing of a “grey” product was more flexible because the seller could pitch the deal at a level which best suited them and was not so influenced by the overheads and costs of more complex supply chains set up by manufacturers.
The motor vehicle trade was a prominent participant in the grey import market. Swathes of vehicles entered the UK from the EU and were sold through car supermarkets and the like at much cheaper prices. It became a well-known phenomenon that UK manufactured vehicles could be purchased for less on the continent and many tried their hand, especially at the luxury end of the market.
Grey imports also thrived in situations where there were import quotas on certain makes and models which were heavily in demand from UK customers. Back street garages thrived when the established dealers initially refused to service these vehicles and, eventually, a commercial war broke out.
It tended to be local distributors rather than the manufacturers themselves who took the greater exception to grey imports because—at least in theory—the sale of grey imports could distort a local market and drive business away from the official dealers.
Grey imports are not unknown within the gun trade also. The air rifle market is particularly susceptible because there are less stringent import restrictions.
However, it is still easy to catch a cold if you’re not careful. Technical specifications can still vary between the UK and elsewhere. In some countries, the legally permitted power of air rifles is lower than ours.
In other cases, specifications which one would normally expect to be standardised can, in fact, differ greatly. What a consumer has seen for sale in the UK isn’t always what you can expect to receive if purchasing “grey”.
Consumers in the UK will generally still enjoy the same rights of fitness for purpose and satisfactory quality provided they have purchased their grey import from a UK trading business.
This presents a risk for the “grey” seller because if a product proves faulty they have no distributorship arrangement or warranty provisions to fall back on. As such, they take the full risk if something goes wrong and if the product is rejected they must bear paying back the full price with no recovery from elsewhere.
What consumers won’t necessarily get the benefit of is a valid warranty on a grey market product. Warranties can be specific to countries or regions. It is not unknown for dealers in the UK to refuse to repair a product under warranty if it is a grey import.
Guns are (increasingly) more traceable in that respect and any increase in the volume of grey imports may result in the consumer’s expectation of a repair being thwarted through the diligence of an official dealer who checks the origins of the gun when it is presented for warranty work.
The presence (and appeal) of grey imports diminished significantly. Some manufacturers tightened their distribution networks over time and contractually obliged their distributors only to sell to end users. Others took a different route and broadened their warranties.
Many well-known manufacturers now stand by their warranty regardless of where the gun has been bought as they would prefer not to have their brand reputation damaged by localised problems, especially where they are selling world-wide.
As I have said, a consumer will still have their statutory rights which operate regardless of the warranty (or lack of it) and so a seller should always check the warranties carefully to make sure they apply.
Hasta la vista
Our departure from the EU; which will undoubtedly carry with it greater restrictions on the freedom of movement of goods, additional tariffs and the like, may naturally present a renewed interest in grey imports.
Whichever side of the fence you stand, past experience has shown that trading with grey imports carries fifty shades of risk. Ultimately, a reliance on them may only serve to damage the reputation of the gun trade as a whole in the eyes of dissatisfied consumers. Warranties have now come to be expected as part of a purchase.
The shades of risk vary when dealing in, say, second hand goods where consumer statutory rights are less potent and a warranty is no longer relevant. But then, of course, less risk carries less financial reward. In that scenario, the question becomes… is it worth it?