- OEMs revealed that dealers have become key partners in detecting grey/black market operations. OEMs educate dealers on how to identify black market parts and some OEMs even have a reward system for dealers that report grey/black market activities.
- OEMs have also found success by partnering with customs officials and foreign governments. The more educated the officials are, the more likely they are to spot abnormal shipments, a win-win situation for both the officials and the OEMs. One domestic heavy equipment OEM has also started a government lobbying group to educate foreign governments about the importance of IP protection.
- Another interesting method employed by one import OEM involves using a third-party webcrawler to search for violations online. This process has proven to be extremely successful for the OEM thus far, removing over $150M in grey/black market parts from the marketplace.
- As a countermeasure on the dealer side, several OEMs reported tracking sales per UIO and/or utilizing RIM to spot unusual inventory movements (or lack thereof). Though determining if an inventory discrepancy is actually caused by grey/black market activity can prove to be difficult, these methods are a good starting point and may indicate a need for additional digging.
Bottom Line: If your company is worried about the proliferation of a grey/black market for your parts, here are five steps you can take:
- Educate your customers. Stop grey market and counterfeit at the point of purchase and installation.
- Partner with your dealers. Both your company’s and your dealer’s incentives should be aligned; dealers can be a powerful force out in the field.
- Educate customs officials. Catching the “bad guys” is their goal as much as yours.
- Do internet research. A huge chunk of illicit trade is done online. If your company doesn’t have the resources to do the research in-house, then invest in a third-party tool.
- Use your data. There is a reason your company tracks inventory. If something appears out of place, then do some digging.