Topic: GREY SNEAKERS (Nike & Air Randy's hidden market)

I briefly mentioned in the Air Jordan thread about the whole Air Randy thing so I thought it’s good to have a separate thread about it.  This is my take on it based on my 25+ years’ passion to sneakers. Feel free to share your thoughts as this is NOT the definite info on the issue as I don’t work in the sneaker industry or law enforcement agency.

For starters, this is a good article from sneakerfreaker years ago  THE SCOOP ON FAKE SNEAKERS http://www.sneakerfreaker.com/feature/fake-sneaker-info

Enjoy the light read albeit long read smile

SO WHICH ONE IS WHICH?

FAKE - by definition means not authentic or genuine.  Fake product is the term used for the illegal copying and manufacturing of name-brand products.  In also goes by the other names like imitation, replicas, knockoffs or bootleg. BOOTLEGGING is to produce, reproduce and distribute without authorization or license.  COUNTERFEIT is an imitation with intent of fraudulently passing it off as genuine. In essence Fake is a poor DUPLICATE of the genuine product. 

For example, a Fake Jordan IV starts by obtaining an authentic Jordan IV (normally smuggled out from the original factory) to reverse engineer, make a mould and use inferior direct and indirect materials in the build.  If you reproduce more Fake Jordan IV for distribution then you are BOOTLEGGING.  If you intend to pass your FAKE Jordan IV as genuine, then you are COUNTERFEITING.

VARIANT is a sneaker with slight variation in the official product. Un-released official colorways that is not distributed to the public are also called Variants (like team college sneakers for players).

FACTORY VARIANTS can either be authentic (will discuss later) or fakes made to look different at factory level i.e. colorways or materials. Variants came into prominence in the sneaker hobby after Jordan retired for the 2nd time with the release of the Jordan XV.  What’s ironic is variants pave way to Customization of sneakers and in a way, Nike ID.

HYBRIDS are sneakers made from two or more models fused together.  In the 80s especially in Asia before Nike gave distribution rights, retailers buy straight from the factories.  Any sneakers damaged in transit are fixed and glued together often times resulting in a sneaker with a different top or bottom. So these sneakers are usually one-offs and not necessarily fakes, it’s just the result of the retailer not wanting to lose a sale.  Again, ironically, hybrids pave way to Nike fusions.

FACTORY SECONDS means imperfections found on the finish product which is also same as B-GRADES.  B-Grades are sneakers that fail the quality inspection.  There are two kinds of B-Grades.

FACTORY B-GRADES are sneakers that didn’t make the final cut in the manufacturing process i.e. factory, before shipment to the warehouse for distribution. Usually these sneakers are considered faulty and ‘written off’ (will discuss later).

OUTLET B-GRADES are finished sneakers shipped from the factory but failed the quality inspection for official distribution to the retailers-consumers.  Failed units are usually sneakers with minor cosmetic flaws.  Usually if one unit fails the inspection, 100 units before and after are taken out and considered B-Grades i.e.  1 fail unit = 201 B-Grades units to the outlets.


OK, SO WHERE DOES AIR-RANDY FIT IN THE SCHEME OF THINGS?

The best way to describe Air Randy, Marquesole etc is that they cater for the demand that never existed before in the sneaker industry.  Can I coined this term or trademark it? LOL. Anyway, I call these sneakers == GREY SNEAKERS


GREY SNEAKERS?!! WHAT THE HELL ARE YOU SMOKING?!

You see, fake sneakers are one of the commodities found in the black market.  A BLACK MARKET is the trade of goods and services that are illegal in themselves and/or distributed through illegal channels, such as the selling of stolen goods or counterfeits.

A GREY MARKET is the trade of a commodity through distribution channels which, while legal, are unofficial, unauthorized, or unintended by the original manufacturer. The term grey economy, however, refers to workers being paid under the table, without paying income taxes etc. It is sometimes referred to as the underground economy or "hidden economy".

So thats why I call them GREY SNEAKERS.  It’s not fake because its authentic materials etc but not legit because it is un-authorised, un-sanctioned by Nike.  These dont "exist" in a way because on paper these "excess units" (see factory B-Grades) are shown as defects and/or write offs in the manufacturing cost of the Chinese OEM (Original Equipment Manufacturers) when Nike does an audit.

Please picture this scenario.

1.  Jordan Brand meeting in Jan 2011, OK’s the retro of the Air Jordan III in Holiday 2011.  JB instructed the factory to make a ‘sample’.

2.  Sample produced and shown in JB meeting in March 2011.  JB’s approved the sample. 

3.  The sample and ‘TECH PACK’ are given to the OEM factory in June 2011 for mass production of say 1000 units for $XXX money.

4.  The OEM factory was given 3 months from July to September 2011 to produce 1000 units.

5.  The OEM factory allows OVERRUNS to compensate for possible faulty, defected units or Factory B-Grades. Therefore the factory produces 1000 units + OVERRUN units.

6.  The OEM shows these OVERRUNS in the manufacturing cost as write-offs so on paper when Nike does an audit these are considered ‘destroyed’.

7.  The OEM instead of ‘destroying’ the write-offs instead sell these units for extra $XXX. This is where Air-Randy etc comes in.

8.  Usually the Air Randys get the first batch or the run of units thus the sneakers may look slighty different (see Variant as well) and different packaging and accessories (e.g. the shoe horn used is from previous stock).

9.  Air Randy sells these units in July and September online to us, sneaker afficianados, which is the same timeline at the production time at the factory. THUS out in the streets months in advance of the official release date.

10.  Once the OEM finished the order and shipped the 1000 units, they can be greedy and sell the TECH PACKS and SAMPLE to the counterfeit industry.

11.  JB received the 1000 units in the warehouse in October. Looks for any potential outlet B-Grade units then distribute the remainder to the retailers for the Dec 2011 Holiday release.

Don’t be naïve to think that the Triads etc are not a part of this.  They do in the Black Market but they are keeping an eye at the Grey Market as well. 


NIKE SHOULD DO SOMETHING!

NOPE!  This is the tradeoff for Nike outsourcing their intellectual property to countries with little or even no regard to patents/trademarks, brand protection and lax labour practices in the name of maximizing profits. 

At the end of the day, Nike is not pursuing the Grey Market Merchants of the sneaker world like Air Randys and Marqueesoles. WHY?

1.  It hardly put a dent on the $$$ billions gross sale profit of Nike

2. Sneakers worn out in the street months in advance of the release are UNPAID PUBLICITY and MARKETING.  Nike is really a marketing company as well.


SO ARE THEY GOOD OR BAD?

These sneaker merchants see a market for these grey sneakers and they capitalise on it. It wise business move I say because if Air Randy dont, someone else will.  If they stay in the grey market then IMO its all good but if they are doing counterfeiting then HATE HATE.

Again it really is a fine line. In the end we THE CONSUMER WINS because WE HAVE A CHOICE.  However its CAVEAT EMPTOR.  Let the buyer beware.  IT IS WHAT IT IS.


I think it’s too long of a read now. WILL ADD LATER … about NIKEBIZ.

Please feel free to add. Just my two cents worth smile

=K=

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

Longest bit of writing i ever read on a forum.

Awesome read dude, thanks.

Serial chilla

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

great read Kukakoy, dropping business knowledge like a bawse

I suppose very vaguely this is similar to grey imports for camera gear, eg DSLR bodies and lenses, whereby stuff is imported in without the authorisation of the company, e.g. Nikon. The only difference is that resell value on most current cameras isn't that great so the importer would be looking to sell at a lower price than RRP while still making profits, whereas with sellers like air randy they can price their sneakers according to the hype surrounding the shoe and how early they've got it, etc.

I think.

Either way, it's just a cycle that's keeping the world go round, but if the shoes are counterfeit, then well I'll start buying Feit or something because at least I will know where I am getting my shoes from.

The looser the waistband, the deeper the quicksand

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

good work as always Bro K :thumbsup:

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

K, That was fantastic. Thanks for the all the effort and great explanations.

Something to add in the NIKE SHOULD DO SOMETHING! section
1. All these faulty and 'destroyed' pairs are a tax deduction for Nike! Even more reason for them not to care!

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

real good article man
so it seems that in the end it is nike that produces air randys shoes but they shouldnt be in his hands to sell? but they might have some or very little faults in the batch he gets...?
thats what ive understood anyway is it right orr

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

Good write up k.. Pretty much exactly how i understand the different process of sneaker production/distribution. I have purchased from Air Randy before and had a reasonably good experience. The sneaker (CDP 4) was in perfect condition except for a slight excess piece of plastic on the bottom lace holder. Cut it of with scissors, Problem fixed. Purchasing from these online grey market sellers just means you have a slightly better chance of getting a faulty product.
I would say 2-5% of the Nike's sold at legit retailers have a small fault. 5-10% with the grey sellers. It's a risk, but sometimes one that can be worthwhile. If you get a shit product then i believe getting a refund is not to difficult.

All in in All...

IT IS WHAT IT IS...

A perfect example of the World we live in..

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

ha "Grey Sneakers"

Awesome term dude

#DUBNATION

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

very useful bit of info!

all goes down to personal choice at the end of the day - so when people bitch and moan that their shoes arent 100% the same as what is on FL shelves, what were they honestly expecting?!

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

nice work pare! I have trolled through so much crap on this topic recently and this is the first piece of info that I have come across that actually makes sense.

You will have to watch your back for the triads now that you have exposed their "trade secrets" lol!

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

Great Explanation K, some seriously useful info

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

If you ask me it dodgey as all hell. Basically its illegitimate stuff.
grey market means that you buy it from a legitimate source and then bring into country (as either it is not sold in that market, or you are parrallel importing, eg buying from eastbay website rather than a local footlocker store).
Anything not out of the production run and sold originally by an authorised Nike reseller... do me is illegitimate.
To me if you buy this stuff your you may as well buy it from"cheapcheapJordans.com"

All the gear and no idea.

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

and since your paraphrasing wikipedia (never a good thing), I'll quote it (also a bad thing)
"Unlike black market goods, grey-market goods are legal. However, they are sold outside normal distribution channels by companies which may have no relationship with the producer of the goods. Frequently this form of parallel import occurs when the price of an item is significantly higher in one country than another. This situation commonly occurs with electronic equipment such as cameras. Entrepreneurs buy the product where it is available cheaply, often at retail but sometimes at ***, and import it legally to the target market. They then sell it at a price high enough to provide a profit but under the normal market price."

See... its the buy legally at a cheap price then sell it some place else, for a profit, but cheaper than the local market.
What you have here is buying illegally then selling for a profit.
Not "grey sneakers" but "black sneakers" cause I think your more at the black market end of the scale.

All the gear and no idea.

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

nice input guys wink

bro mikgit. awesome post there. yeah i know parallel importing which is also grey trading as well (note to self dont use wiki all the time lol). its just that i'm trying to link this whole supply/demand thing to an existing trade. i could put it on the black market thing but i associate that trade to obvious fake sneakers on a larger scale being run by organised crime. in my teens there used to be a sneaker factory whence i came from and one of my mates can buy straight from the factory just the shoes no packaging. not sure if he bought it from a factory worker or from the owner but he obtained it. most likely theyre the factory b grades but from what i recall i dont see a big flaws just lil bit of overgluing. so that how i picture air randy that he made deals with the factory owner (or the owner is in cahoots) to buy the
overruns. but if he stealing the batches from factory waiting shipment then thats a 'black market' operation.

anyway. i thought this air randy thing is sorta 'shades of grey' you know the uncertainty to it so i connect it with the grey market. lol smile

keep on posting guys. smile

=k=

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

well, very grey indeed

http://images.sneakernews.com/wp-content/uploads/2011/08/air-jordan-xi-concord-retro-2011-air-randy-2.jpg

http://sneakernews.com/2011/08/09/air-j … air-randy/

The looser the waistband, the deeper the quicksand

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

Wow they do not look right

#DUBNATION

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

Good work k :thumbsup:

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

great post! i will be getting my blk cem 3 and conchord 11s from k101 the money im paying for my sneakers is real so should the product. but if i can get my hands on air randy ray allen 13 i will flip that shit faster than u can say heads or tails =P (bank roll my yeezy 2 fund)

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

ive been to China (Shanghai and Beijin) twice in the past 3 years.

My first trip in 2008, i was taken to the markets and spotted plenty of fake jordans , selling for $25-30 AUD at the time.
they were good, but with a keen eye, you could they were fakes.

Fast forward to 2010 and i was taken to the same place and the level of detail and quality had stepped up.

As one of my wife's relo's was a local, they filled him in on how they did it, Apparently, they source similar cheaper items and copy the tooling of the Nike machines can re-produce the shoes at an alternate factory, these are then flogged at markets etc .

I was taken to a Proper public "factory outlet" with full retail style set ups and branding.

Even there they were selling fake nike's , higher quality , but none the less fakes.

I use to work in manufacturing, and like any business, they would be buying in materials to suit the size of their intended production run, raw materials would be stocktaked at the end of the run, so if there were large amounts missing, there would be an investigation on nike's part.

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

@ bro Vuey. Nice post. These OEM factories are smart enough not to have a big loss in the stocktaking of direct manufacturing cost to avoid an investigation by Nike.


@ Bro minhhy thanks for the picture. see how grey things are if you dont look at these AJ XI concords at face value.

QUANTITY

it is the GR feature product from JB for the Xmas holiday season. more units than normal wiil be produced to boost the end of year sale earnings. the OEM factories have to be already in production mode by June to meet the number of units.

Let’s say an estimate of 30000 units for the WORLDWIDE market is to be made. How many are there at the picture?  There are around 30 pairs up there which is only 0.10% of the total! It wouldn’t surprise me if he amasses 300 AJ XI concords because that’s only 1% of the total.

QUALITY

People at various sneaker sites dismiss the sneakers in the picture straightaway as B grades or Fakes. again not at face value..

Sloppy lacing? Of course, these units came straight from the factory assembly line not from the post production units ready for shipment.

looks B-Grade/Fakes.. who are we to know the quality of the finish product on official release? for all we know, the quality looks poor because the actual release pairs are on par with poor quality B-grades or Fakes. since when do jordan brand GR retro sneakers are of high quality sneakers anyway?

All these cost cutting measures with no regard to quality control to maximise profits only encourages the grey market and now is the better time for the Air Randys to do this. 

Why? Because of JB stupid product releases.  AJ III black cement in Oct, AJ XI concord in Dec and AJ IV white cement in early 2012 - c'mon all within weeks of each other!

if these grey sneakers merchants keep the operation small like making money on the side out of the write-offs then its Hell Yeah. big hell yeah if the money goes to the workers pocket (i doubt though).

but if the demand is really high and they take the risk of mixing the units with Fakes because of high sales then Hell No!

=k=

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

i was wondering how they got their shoes so early

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

I've wondered how marquee sole got their shit so early. And, wrongly, assumed they were legit because the prices were so damn high.

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

Nice read K.

China is so equipped and immense that nothing, and I mean nothing, really is impossible. 

My brother-in-law teaches Orthodontics at a Dental Uni there and he has seen the markets in Shenzhen etc etc with warehouses of fakes.  In fact if you know your stuff they have a tour for overseas distributors there for them to choose.  this was 2003.  Apparently its even bigger now.

You also have to factor in that fakes have levels/grades such as A, B, C qualities.  The A grade fakes you can hardly spot the difference and many argue these might be the grey units that Kuyakoy is talking about.

In the Philippines right now, I have contacts getting their "early releases" from Hong Kong.  They got the Blackt cements there and the Concords are ordered already.  No doubt thats also the same source as Air Randy's etc etc or maybe Air Randy with a different sourcing panel. 

I am trying it out just for curiosity's sake. 

In Manila, entrepreneurs buy grey unit mobile phones, cameras, laptops etc etc that are sourced from HK and China....I suppose this ain't going to be any different. 

When there is demand....the businessman cometh.

I love what Kuyakoy said.  IT IS WHAT IT IS :-)  I have been lurking here for quite a while and its useless complaining.  The quality is down because NIKE/JB knows they can put out a Concord with Kwame Browns' snot and it will still sell.  Yes, people will yell, jump and curse and stopm etc etc...but they will buy it.  They might not admit they bought it..but they did LOL!

Kaching kaching kaching.....$$$

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

awesome article K, seems you have inspired the world - they even reposted it here;

http://www.solesupremacy.com/2011/08/fo … ought.html

Re: GREY SNEAKERS (Nike & Air Randy's hidden market)

nice inception post k now its spreading like a virus
http://www.sneakerfiles.com/2011/08/19/ … t-approve/