How Apple tries to stop grey marketeers from buying out iPhone stock in Shenzhen

For most of the iPhone’s lifespan, it has been unavailable in mainland China. Now that it is, however, Apple has taken some extreme measures to prevent some customers from buying large quantities of iPhones intended for grey market resale.

The main limitation is on walk-in sales, as customers can not simply walk in and buy an iPhone. They must first order their iPhone online for pickup, and even then there is a limit of one-per-customer, per-day. Apple has also limited the amount of iPhones that can be bought by one credit card to 10 units, meaning customers wanting to purchase more than 10 will have to use a different method of payment entirely, regardless of how many days their purchases span. What’s more, a limited amount of iPhones can be bought by one customer via Gift Cards, which is being used as a loophole to avoid the credit card policy.

Apple’s Chinese website is also designed to control the amount of iPhone orders, in order to prevent hundreds of customers coming in to pick up a smaller amount of units. The phones must be activated on the spot, and Apple is even taking measures to ban customers who try to abuse its policy repeatedly.

Despite all of Apple’s efforts, however, its products still floods the grey market. This shady electronics marketplace has proved self-sustaining, as its tactics to deplete Apple’s stock only work further in its favour, with desperate Apple customers paying hundreds of dollars more due to Apple’s low inventory.

Is it really worth the effort to try and squash the grey market in China, of all places? Is there something else Apple could do that would be more effective?

Let us know what you think in the comments!

Via: TechCrunch

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  • BrainRoopull

    Sounds like a smart move to me…  Many high-demand products have been tarnished by the feeding frenzy that can come from “prospectors” buying up the supply and reselling them at a premium.  I actually applaud Apple for this.