Two wholesalers in bicycle price-fixing charges get R4m administrative fines each

[Popit]

What is the legal standing on warranties when buying GREY .....

Surely , as long as it is a legitimate purchase (CRC) , the warranty needs to be covered by the local agent ?

Shimano , Campag et al have a world wide brand to uphold , regardless of where you bought the product . Once again presuming it is a legit purchase from an authorized dealer !!

[udxcob]

Reading this makes me keen to open an online store that sells grey/gray imports at cost.

[udxcob]

 

Reading this makes me keen to open an online store that sells grey/gray imports at cost.

And earn a living how exactly?

[Eldron]

What is the legal standing on warranties when buying GREY .....

Surely , as long as it is a legitimate purchase (CRC) , the warranty needs to be covered by the local agent ?

Shimano , Campag et al have a world wide brand to uphold , regardless of where you bought the product . Once again presuming it is a legit purchase from an authorized dealer !!

 

Grey products are not supported by local importer because they've been brought in through unauthorised channels. It's unfair to expect the local agent to provide a warranty for a product they received no profit from.

 

The grey importers have zero warranty overheads so it's a little unfair to get the cheap price then expect the official importer to cover your problems with staff/offices/tools they've had to buy.

 

CRC is a little stickier - legally you're right - morally you're wrong.

[FCH]

why is CRC stickier? 

I would assume the local distributor will still see it as a grey import and say "not my problem"; so legally they are still under no obligation to assist or replace?

 

 

 

Grey products are not supported by local importer because they've been brought in through unauthorised channels. It's unfair to expect the local agent to provide a warranty for a product they received no profit from.

 

The grey importers have zero warranty overheads so it's a little unfair to get the cheap price then expect the official importer to cover your problems with staff/offices/tools they've had to buy.

 

CRC is a little stickier - legally you're right - morally you're wrong.

[Eldron]

why is CRC stickier? 

I would assume the local distributor will still see it as a grey import and say "not my problem"; so legally they are still under no obligation to assist or replace?

You're probably right. I know there are agreements in place to support OEMs like bicycle manufacturers but I'm not sure that extends to product that is bought through an official channel but in another country.

[kosmonooit]

Nope that's not correct. Just because the stores are part of a franchise they are independently owned and therefore should be free to adjust their pricing to align with their market conditions. All the brand owner can do is what is termed "price coaching". This is where the brand owner can provide appropriate price analysis and this has to be conducted independently of walking into competitors stores to see what they are selling similar items for.

 

 

Depends on the franchise agreement surely. With something like Spez shops, I would think that 'harmonised' pricing nationally would be non-neg.

 

And think of Apple Store.

[raptor-22]

Harmonized pricing is an interesting one. I don't think anyone has really challenged it but it's a bit like RRP which is not strictly a legal practice. Pretty much like auto pricing they get away with it because some degree of price control is needed and authorities recognize this. When it becomes illegal is when a franchisee decides to discount stock to clear old stock and that lands them in jetway we with the franchise owner. The idea of the legislation is to ensure that retailers aligned with large franchises don't gain an unfair advantage from that relationship .

[Broker]

 

 

 

" now if that is a decision that Shimano / coolheat has made to only supply physical brick and mortar shops and not to supply online retailers.... that would boggle my mind, again not sure if its the case or not. But no surprises with grey imports and CRC growing hand over fist."

 

 

 

The above are actually 100% correct. When we planned to start an online store about two years ago we applied to deal with Coolheat and Omnico. They both point blank refused as we did not have a physical operating store. Thet would only consider registering us as a dealer once they inspected our site (Bicycle Store)

Edited June 2, 2016 by Broker

[Tumbleweed]

Oops.Typing trouble

Edited June 2, 2016 by Tumbleweed

[Tumbleweed]

You're probably right. I know there are agreements in place to support OEMs like bicycle manufacturers but I'm not sure that extends to product that is bought through an official channel but in another country.

There was some commentary when the CPA became law that it had envisaged covering that type of scenario. But I don't think the legislation was strong enough to do so in the end. Would make for an interesting test case though.

[Showtime]

Harmonized pricing is an interesting one. I don't think anyone has really challenged it but it's a bit like RRP which is not strictly a legal practice. Pretty much like auto pricing they get away with it because some degree of price control is needed and authorities recognize this. When it becomes illegal is when a franchisee decides to discount stock to clear old stock and that lands them in jetway we with the franchise owner. The idea of the legislation is to ensure that retailers aligned with large franchises don't gain an unfair advantage from that relationship .

 

Yes definitely for the vehicle market some price control is needed.

 

Let's take Toyota as an example. The big selling point is that you can find a Toyota dealer in pretty much every town. If the dealer in the big smoke who is moving large volumes discounts like crazy and the people from small towns go and buy in the city but then expect service in their local town the system will collapse and the brand will suffer.

[JXV]

Yes definitely for the vehicle market some price control is needed.

 

Let's take Toyota as an example. The big selling point is that you can find a Toyota dealer in pretty much every town. If the dealer in the big smoke who is moving large volumes discounts like crazy and the people from small towns go and buy in the city but then expect service in their local town the system will collapse and the brand will suffer.

The competition laws are about ensuring fair competition between competing brands. Nothing wrong with e.g. Toyota SA setting a pricing structure for its dealers.

 

But if Toyota made a deal with all the other bakkie suppliers to fix prices and carve up the marketplace into zones............

 

Sent from my SM-G900F using Tapatalk

[cdevil]

And earn a living how exactly?

 

I already earn a living. This would be more of a non-profit community/bundling of orders type thing.

[GrumpyOldGuy]

Grey products are not supported by local importer because they've been brought in through unauthorised channels. It's unfair to expect the local agent to provide a warranty for a product they received no profit from.

 

The grey importers have zero warranty overheads so it's a little unfair to get the cheap price then expect the official importer to cover your problems with staff/offices/tools they've had to buy.

 

CRC is a little stickier - legally you're right - morally you're wrong.

Yeah, but I think its a short sighted attitude. We live in a global world where every single manufacturer bar none is trying to get closer to his customer, not further away. People buy goods in one country and move to or use it in another, why should they not be covered.? 

 

In most instances this is NOT the manufacturers attitude, its the distributors, the manufacturer cares not a jot where he replaces a warranty item, it can be in SA or inner Mongolia for all he cares, as far as he is concerned a warranty is a warranty.

 

Actually its my contention that the distributor does not lose money by supporting so called gray products for warranty, we were the distributors for an American brand of pumps for industry, but some of our customers were global companies who purchased their pumps elsewhere and shipped them around to the job on hand. Often we were called on to attend to warranty issues and we did it with a smile, why shouldn't we, it was no skin off our nose, we simply claimed a warranty part or unit from the manufacturer and without fail it was replaced.

In fact it was good business for us to attend to warranties even if we did not sell the product, because the customer came back time and time again for other items or jobs, never underestimate the goodwill of a happy customer.

 

I had an issue with my Sony camera i bought in SA, it was still under warranty by Sony and I took it to a dealer here, he looked at it to check the fault, made a call and replaced it, no questions about where i bought it, why should he care, Sony replaces it to him and he makes a customer happy who may, next time buy it from him.

 

As I say, to me its a short sighted attitude. 

[Mongoose!]

Jip should be like that. But greedy distributors with "grey product syndrome" choose to make it difficult to customers who did not support them in the first place. Teach them a lesson, so the next time they buy, they will buy with us... no matter the price.