Buyers and producers at odds over "gray market"

03/22/2005 | CNET

Companies that retail on the Web are reporting billions of dollars in losses to the "gray market," where online sellers circumvent producer controls to market their products via unauthorized and even illegal distribution channels -- thereby raising the margins and reducing the profit for manufacturers. However, e-tailers are not necessarily all that sympathetic. EBay spokesman Hanni Durzi said, "That's exactly what eBay is designed to do -- remove inefficiencies in markets."

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