Friday, November 11, 2011

Gray Market Equipment


After saving forever to buy your new camera, you've finally saved enough to make the big purchase. You've already got a great price from KEH, but like most people, you want to take one last look around, just to be sure you're getting a good deal. You surf the net, and low and behold, you come across a company that you've never heard of, that promises to sell you the same item for hundreds less. In many cases, it may be someone trying to sell you a GRAY MARKET or IMPORT item. The ad reads "new, with manufacturer's warranty", so what could be wrong? First, let's look at what you might be getting. I'll use Nikon as an example. Nikon manufactures much of it's photographic equipment in Asia. Once manufactured, it is shipped around the world to various importers or distributors. Product that is designated for distribution in the United States will be sent to Nikon USA Inc. After that, Nikon USA will sell it to all of its Nikon authorized dealers in the U.S.

On rare occasions, a new product that is sold by KEH (a Nikon USA authorized dealer) may have a problem. Since the new product may still be under warranty, the customer will send it to the closest Nikon USA authorized repair center, so that the item can be repaired and returned back to the customer at no charge. A similar process would apply if you purchased a new Canon, or most other major photographic items.

One day, a camera merchant decided that he (or she) wanted to make their sales more profitable, so they discovered that they could purchase new equipment outside the U.S., and bring it in the country themselves, bypassing the importer (such as Nikon USA, Inc). They saved a bunch of money by doing this. These items are commonly referred to as GRAY MARKET or IMPORT items. Yes, they increased their profits, but problems soon arose. A customer that purchases one of these items may notice several things. First of all, the packaging may look a bit different. The instruction book might be in another language, or it's a photo copy, or possibly not even included. There also might not be a CD with software in the box. The AC adapter or charger might be generic, since a charger that was designed to be sold in Europe would have a different wall plug on it. Another issue would be no Nikon factory rebates or other promotions would apply. These will only apply to Nikon USA items that are purchased from a Nikon USA authorized dealer.

The most important difference between a Nikon USA product and a GRAY MARKET or IMPORT item will be the warranty. If you purchased a new Nikon USA product from KEH, you would be covered under the Nikon USA warranty. In other words, Nikon here in the U.S. will repair all of your warranty covered repairs for free. If you purchased a GRAY MARKET or IMPORT item from some other dealer, and sent it to Nikon for warranty repair, it will be returned to you without being repaired. In addition, even if the item is not covered by a warranty and you wanted to pay to have it repaired by Nikon, they still will not do it.

So how do they know if it's GRAY MARKET or IMPORT? In some cases, it's easy. The manufacturer will have a different model name or number when they make items that are to be sold in countries outside the U.S., but not always. When you send in your item for warranty repair, you will be required to send it in with your original invoice or proof of purchase. Nikon will not only verify that they imported the serial number of your item, but they will verify that you purchased that item from the Nikon authorized dealer that they originally sold it to. This protects the manufacturer from having to warranty items that were never sold to a dealer at all... these warranties are also not transferable, which means that if you sell an item that you purchased new to a friend, the factory warranty will end at that point.

Now, we have just talked about how being a NEW gray market item affects your warranty and repair, but let's further discuss how being a USED gray market item affects these things as well. Since a USED item doesn't come with a manufacturer warranty, and will only come with a retailer warranty (if they offer one... ours is now 6 months!), then that part is null and void anyways. So, the only time that buying USED gray market items affects the customer is if the customer wants the manufacturer specifically to repair their item (in the case that it needs a repair), and does not want another repair shop to do the work (such as KEH Repair Center).  

If you are concerned about purchasing a gray market camera (new or used), then keep in mind that any reputable company that is selling gray market or import cameras will specifically mark the equipment for sale as such. Many companies simply call it “gray market”, while we call ours “Non-US” (KEH only sells “Non-US” USED gear, and not new gear). If you purchase a camera from a non-reputable company or individual, then often these items are not marked as gray market and you could find yourself in trouble down the road. To sum up, any gray market equipment will not be repaired by any US manufacturer repair facility (Nikon, Canon, etc.) whether it's under warranty or not, but KEH will repair any and all of the gray market items. So the lesson is, buy from a  reputable company, and it's usually best to stay clear of NEW gray market items, but USED is OK if you don't mind getting your repairs done at KEH or another non-manufacturer repair shop!


- AZ