| Date: | Tuesday, June 25, 2024 |
Definition of Parallel Export Parallel export refers to the export of products legally obtained without the approval of the original manufacturer or brand owner to another country. This type of trade is also known as the "gray market." Products are typically sourced from lower-cost markets and sold in higher-priced markets. While parallel export provides consumers with access to more affordable prices, it can present challenges for brand owners and official distributors.
A Brief History of Parallel Export Parallel export began to play a significant role in global trade from the mid-20th century. With globalization, the practice of selling products at different prices in different countries and consumers wanting to take advantage of these price differences has led to an increase in parallel trade. Particularly in the European Union, the concept of a single market and free trade policies have played a major role in the proliferation of parallel export.
The Importance of Parallel Export
Advantages of Parallel Export
Disadvantages of Parallel Export
Key Considerations in Parallel Export
Successful Examples of Parallel Export Parallel export is widely used in many sectors worldwide. Below are some examples where parallel export has been successfully implemented:
Electronic Products Electronic products are in high demand worldwide. Especially popular brand products are among those commonly subject to parallel import. For example, when a new phone model is launched in one country, the prices and stock status of this model may vary in other countries. In this case, parallel export from low-cost to high-cost countries allows consumers to access these products at more affordable prices. Companies engaged in parallel import can obtain these products earlier and at lower prices than official distributors, gaining a competitive advantage in the local market.
Luxury Consumer Goods: Perfume and Cosmetics Perfume and cosmetic products are another sector where parallel export is frequently seen. For example, perfumes of a famous brand may be sold at more affordable prices in Europe, while they are sold at higher prices in Asia or the Middle East. This presents attractive opportunities for parallel importers. They can obtain products from Europe and sell them in other markets to make a profit. Such parallel trade offers consumers a wider range of products and access to luxury brand products at more affordable prices.
Automotive Sector: Spare Parts and Accessories Automotive spare parts and accessories hold a significant place in parallel export. Especially spare parts produced by original equipment manufacturers (OEM), can be sold at different prices in different countries. For example, spare parts for a car brand may be found at more affordable prices in Europe while sold at higher prices in North America. In this case, parallel importers can source these parts from Europe and sell them in North America. This way, consumers can be offered more affordable spare parts, and car maintenance costs can be reduced.
Fashion and Clothing: Branded Clothes In the fashion and clothing sector, especially branded clothes and accessories are frequently subject to parallel export. For example, a new collection of a famous fashion brand may be launched earlier in Europe and sold at more affordable prices. Parallel importers can source these products from Europe and sell them to customers in other countries at higher prices. This type of parallel trade provides fashion-following consumers with faster access to the newest products and increases the global recognition of the brand.
Pharmaceutical Products: Medicines In the pharmaceutical sector, drug prices can vary significantly between countries. This creates opportunities for parallel import. For example, a drug may be available at a more affordable price in Europe while sold at higher prices in the USA. Parallel importers can source this drug from Europe and offer it for sale in the USA. Such parallel trade can reduce drug costs and increase access to healthcare. However, attention to legal regulations and quality standards is crucial when conducting parallel import in the pharmaceutical sector.
Conclusion Parallel export is successfully applied in many sectors, offering various advantages to consumers. Sectors such as electronic products, luxury consumer goods, automotive spare parts, fashion and clothing products, and pharmaceutical products represent successful examples of parallel export. This form of trade provides consumers with more affordable products and allows suppliers to gain a competitive advantage in global markets. However, attention to legal regulations and quality standards is necessary when engaging in parallel export. You can contact us for financial processes and procurement regarding the purchase of products at Clef Trade.
