Unauthorized sales through bad actors in the channel plague vendors partner programs and undermine customer experience. Bringing the gray market under control is a constant battle for vendors.
At Channelnomics, we field questions about best practices, partner strategies, and channel programs every day. In this series, called “Ask Channelnomics,” we answer some of the questions we receive most from vendors.
Question: We’re dealing with increasing gray-market activity in our channel. We have authorized partners selling products at below-market prices, and we have authorized partners getting products at lower prices, undermining other partners’ ability to sell. How are other vendors addressing the gray market problem?
Answer: The gray market, a long-standing issue in the channel, involves both authorized and unauthorized partners acquiring products through secondary or unauthorized sources. These partners then resell the items to customers, often at deeply discounted or below-market prices. Because they’re acquiring products at lower prices, these partners can secure substantial profits.
