3/5/2009 10:57:00 AM
Nokia probes into grey trading from UK distributors and retailers
Nokia is investigating high levels of grey market trading from UK distributors and retailers, Mobile can reveal.
Of the 113 million handsets that Nokia shipped globally between October and December 2008, five million were resold through the grey market (4.4%), according to well placed sources.
The UK has come under the microscope of senior Nokia officials amid record levels of grey trading.
The manufacturer said it would consider removing ‘Approved Partner’ status pending the investigation. Mark Loughran, Nokia’s UK general manager, said: ‘This is a very serious matter and one that we are now fully investigating. The key objectives of our review in 2008 were to select distributors who had the highest standards and to create a close working partnership. Any proven breach of these standards would be contrary to our partnership and we would look to act accordingly.’
Exporting UK stock into other countries has been driven by the rapid fall of British currency at the end of last year.
The British pound fell from E1.30 to parity between October and December, which made UK stock extremely attractive for foreign buyers.
Demand for Nokia stock from the UK has come from countries which don’t track serial numbers such as Iraq and Iran, as well as high demand from South Africa. Sources have indicated significant demand also from Germany and Dubai.
Iceland is the other country identified to have exported large volumes of Nokia stock after its currency, the Krona, also fell dramatically amid the collapse of its economy and nationalisation of its banks.
UK distributors, retailers and operators also found themselves sitting on stock they couldn’t sell as the reality of the bleak Christmas trading period dawned. Many had over-ordered stock as forecasts and orders were placed earlier in the year.
One senior industry source said: ‘A lot of people have been forced to liquidate their stock, and there was a captive audience overseas who saw cheap Nokia stock in the UK because of the value of the pound.’
Loughran (pictured) is understood to be taking a dim view of grey trading and has experience with dealing with grey trading from his previous company GlaxoSmithKline.
Loughran led the tender process for distributors last year.