Home – New Forums Logistics Sell a reject but good products in Australia legal ?

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  • #988352
    frio
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    Hello,

    I have intention to sell branded clothings that have been rejected by the manufacturers due to very minor faulty, for example the sewing is not that straight, or button has a little spot, or something else that is not quite visible to people.

    I plan to cut the brand tag off and have a clear statement about the products. However, the products might still have the original brands printed on the materials.

    Is it legal to sell such products in Australia? I cannot find a clear statement about this in accc.gov.au

    Hope someone can advise.

    Thanks

    #1166817
    Anonymous
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    Hi frio,

    Interesting question! I hope someone around here can help you with the answer.

    If you’re able to tell us where you’ll be sourcing the products from, that might help those in the know to clarify things for you.

    Thanks for joining the forum too, by the way,
    Jayne

    #1166818
    LucasArthur
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    Hi Frio

    As Jayne, i find this question quite interesting… Further to this, i also feel her next question of where you will be sourcing the products from may be important.

    The reason i say this, not being an expert at all, is that if you were buying them from the Manufacturer who is trying to minimise their losses and onsell reject items i feel this would be a HUGE NO NO in the eyes of the said brand owner.

    Although, if you were buying them off the ‘open market’ and the products are readily available i feel this would be ok.

    Taking this a little further though, i can not see the owner of said brands giving permission to manufacturers to offload inferior items that could potentially tarnish their identity in the marketplace… Which would tend to mean the factory is selling these on the side which may create a few issues for you if the said owners see this.

    Would tread very carefully and consider where you are getting these from..

    Look forward to some more experienced peeps adding to this.

    Jason

    Jason Ramage | Lucas Arthur Pty Ltd | E: [email protected]   P: 61 3 8324 0344    M: 61 412 244 888
    #1166819
    frio
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    i might be able to get the products from few asian countries, like malaysia and indonesia… there, they sell those products legally with the original brand.. but i know those countries are not as strict as australia, in terms of regulation.
    i understand that if i sell those products with the original brands and full brand tag, it might annoy the brand owner, as it could ruin their brand image because they all are faulty products… that’s why i want to cut off the brand tag, but there will be brands / logo printed out on the materials that cant be removed though.

    thanks for your thought!

    #1166820
    Johny
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    The reason i say this, not being an expert at all, is that if you were buying them from the Manufacturer who is trying to minimise their losses and onsell reject items i feel this would be a HUGE NO NO in the eyes of the said brand owner.

    Taking this a little further though, i can not see the owner of said brands giving permission to manufacturers to offload inferior items that could potentially tarnish their identity in the marketplace… Which would tend to mean the factory is selling these on the side which may create a few issues for you if the said owners see this.

    Both true, to a certain extent.

    Any manufacturer selling first rate product is almost certainly selling it on the side without the permission of the brand owner.

    Where it becomes a little murky, is when they are “seconds.” To some extent a manufacturer may have some scope to sell onto a wholesaler for example, who may then onsell. There would normally be some provision to this such as removing or cutting through the inside label, even though an outside logo may still be visible.

    There are also international laws (cannot think of the name off hand) which allows products that have not been paid for, to be sold by the manufacturer. So, in essence, a brand that was not happy with the production may refuse to pay for an order, in which case the manufacturer also has some scope to offload that stock.

    I am not involved in that business, but know it is done legally.

    How that works in Australia I don’t know, but I have seen shops that sell “seconds” so it must be doable.

    But I also agree that you would need to tread carefully, especially about where your stock is coming from.

    #1166821
    frio
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    Johny, post: 193513 wrote:
    Both true, to a certain extent.

    Any manufacturer selling first rate product is almost certainly selling it on the side without the permission of the brand owner.

    Where it becomes a little murky, is when they are “seconds.” To some extent a manufacturer may have some scope to sell onto a wholesaler for example, who may then onsell. There would normally be some provision to this such as removing or cutting through the inside label, even though an outside logo may still be visible.

    There are also international laws (cannot think of the name off hand) which allows products that have not been paid for, to be sold by the manufacturer. So, in essence, a brand that was not happy with the production may refuse to pay for an order, in which case the manufacturer also has some scope to offload that stock.

    I am not involved in that business, but know it is done legally.

    How that works in Australia I don’t know, but I have seen shops that sell “seconds” so it must be doable.

    But I also agree that you would need to tread carefully, especially about where your stock is coming from.

    Hi Johny,
    I just want to clarify that when you said “second” .. does it mean faulty products ? or can mean other things like excess products (but actually acceptable quality by the brand owner).. or out of season products ?

    I have been trying to find the international law you mentioned, but hasn’t got anything yet.. do you remember the website address or any clue ?

    Thank you very much guys for all your advise and help!

    #1166822
    Johny
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    I just want to clarify that when you said “second” .. does it mean faulty products ?

    My meaning of ‘seconds”, would be as you mentioned. Something where the stitching is not good enough, a misplaced button hole etc.

    For products that are acceptable quality (excess stock), or something that may be out of season, if a manufacturer is telling you they can sell these to you, then run as fast as you can the other way.

    There are generally some pretty strong agreements in place that stop the manufacturer from selling the branded products.

    That’s not to say you cannot buy stock lots of branded products, it’s just extremely unlikely to be from the manufacturer. There are plenty of wholesalers around who can sell to you, who have sourced the products legitimately, but you need to verify that the stock is genuine, which can get a little tricky in Asia. Then you have to look into the matter of parallel importing to see the avenues for selling these in Australia, because if the paperwork isn’t right, customs may use them as fuel for a bonfire.

    I can’t go into it too much because it is not my business and I don’t know all the ins and outs of how it works.

    I have been trying to find the international law you mentioned, but hasn’t got anything yet.. do you remember the website address or any clue ?

    A few years ago I was looking into selling some products. A customer had paid for some goods, but owed me money for something else. I found that if they hadn’t paid for the goods I could have sold them as I was still holding them, but as they had paid for them I couldn’t. (They were wanting me to pay to ship the goods and then they would pay my outstanding money…yeah right.)

    It was something to do with if the goods weren’t paid for they were considered abandoned. Sorry, I can’t remember where I got that from and can’t remember the full details.

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