A 1998 Harvard Business Review article stated that “as more manufacturers adopt global product strategies, with uniform goods and even multilingual packaging for world markets, international grey markets in many goods may have a bright future”. This was a good guess on the part of the article’s authors, and today, grey components are part of every industry.
While these pose risks and have had a long-term impact on the entire supply chain, affecting revenue, cost, and brand reputation, counterfeit parts are an even bigger concern. Bobcat Equipment South Africa National Parts Manager Deric Knox says that using imitation or fake parts in OEM equipment poses a major risk to the health and safety of machine operators, in addition to being hugely detrimental to the overall performance of the equipment.
“Grey market goods not only pose a potential danger to customers, but also present a serious business challenge. Due to the economic downturn rendering the market highly price-sensitive at present, the best strategy is to educate end users about the disadvantages, and hidden costs, posed by fake parts. In the majority of all cases, Bobcat Equipment South Africa is able to negotiate a matching, or even better, price for OEM parts for our clients,” Knox says.
“This ensures that not only are we able to maintain our market share, but we prevent customers jeopardising the productivity of their operations and the safety of their workers. Customers need to understand the overarching value of genuine versus imitation parts.”
As an example, he cites Bobcat filters. “Bobcat has designed specific for its machines. Non-genuine filters cannot handle the same throughput, or last as long, which poses a significant risk to equipment. While cheaper-priced parts may be tempting, it is important for customers to assess the long-term performance impact these will have on their equipment.”
While it's easy to argue that cutting costs will help keep a company healthy, doing so should never be done at the detriment of equipment at a later date. Finding out how purchasing decisions will affect the company is extremely important, and it’s commonly understood that buying only from reputable dealers, or the original vendor themselves, guarantees that warranties, and service agreements will be valid when they are needed.
