New Breed of Parallel Importers

Page 1

2 of 19 DOCUMENTS

The Straits Times (Singapore) May 16, 2011 Monday

A new breed of parallel importers

BYLINE: Tan Soo Jiuan , FOR THE STRAITS TIMES SECTION: REVIEW - OTHERS LENGTH: 881 words

IT SEEMS that these days, authorised distributors are a sandwiched breed, thanks to a market phenomenon called grey marketing. Grey marketing, commonly known as parallel importing, is the import and selling of genuine goods through marketing channels other than those of the authorised distributors. The parallel importer sources his products from resellers in other markets, and introduces a channel of distribution that rivals the authorised distribution channel in the market of sale. Traditionally, parallel imports comprise goods such as vehicles, watches, fashion items, perfumes, and even items such as toothpaste. Traditionally, buyers of a parallel-imported product are attracted to its low, or lower, price. Parallel imports of Darlie toothpaste can be bought at a steep discount of 40 per cent off its original price. Mercedes-Benz is now the third-most popular parallel import in Singapore, thanks to those who still want luxuries during times of economic crisis, but may not want to pay too much for them. However, a new type of grey marketing has arisen that challenges old models of parallel importing, with consumers willing to pay a much higher price for the parallel import. Last year, before Apple had officially launched its first iPad in Asia, thousands had already been sold in Asian cities from Bangkok to Singapore, and at a substantial mark-up on the United States retail price. The parallel-imported iPad was sold for US $730 (S $905) in Hong Kong and between US $750 and US $1,000 in Beijing, while the US sale price was US $499. The same thing happened when the iPad 2 was launched in the US on March 11. The US price for the iPad 2 is US $499 for the 16GB Wi-Fi model and US $829 for the 64GB 3G version. But in Singapore, retailers and online auctioneers...