Behind The Scenes: How Apple Keeps Grey Marketeers From Buying Out iPhone Stock In Shenzhen

Getting an iPhone in China has always been hard. For most of its life-cycle, the phone has been unavailable in the Mainland except through the grey market. Now that Apple is allowed to sell units in Shenzhen, however, it’s gotten amazingly strict on sales per-person.

The primary limit is on walk-in sales. Users cannot buy iPhones at the store and instead are limited to picking one up per-day, per-customer. You can also only buy ten iPhones per credit card and you can buy limited amounts using gift cards, a loophole the grey market discovered early on.

Apple’s Chinese website also controls the numbers of orders coming in at once, effectively reducing the possibility that hundreds of consumers walk in to pick up the iPhone after a massive flood of orders. Apple also forced buyers to have their phones activated on the spot by employees and there are a number of safeguards in place to prevent repeat offenders from shopping.

Not surprisingly, little of this really works. Pallets of Apple products still flood the grey market and, like most normal consumers, the Chinese buyers resent this intrusion, thereby giving more power to the markets. It’s an endless, clever circle that often involves older Chinese ladies standing outside of Apple stores in New York waiting for iPads Mini while smugglers shoot iPads across rivers into the Mainland with a crossbow.

Arguably, I doubt there’s much grey market demand for, say, the Lenovo Yoga so it may be worth the effort just to keep demand high.

via MICGadget