Analysis

Global Travel Retail - The Grey Market - What is it and why is it causing concern? - Focus

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The grey, or parallel, market is defined as any trading that occurs outside of a manufacturer's authorised channels. It is of particular concern in Global Travel Retail, where a supplier's grip on the supply chain is looser than it might be in domestic markets. This means that a brand owner that sells a certain amount of product to one country through an unscrupulous dealer might see it pop up for sale in another. While the practice isn't always illegal, it can undercut local prices and do an enormous amount of damage to carefully-built brand equity in key markets. In October, just-drinks talked to suppliers at the Tax Free World Association exhibition in Cannes about the frustrations and effects of grey market selling. Here is what we learned.


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