MYOB tightens screws on grey marketers

Business software vendor, MYOB, has fired the latest salvo in the battle against grey marketing by announcing it will tighten controls on OEM software to combat its sale in the retail channel. The vendor is also investigating legal action against non-partners using its name and logo in advertising.

The company outlined the steps it is taking against misuse of OEM products in a letter to resellers from channel manager, Peter Ferrigno, in which he claimed some merchants had been selling MYOB and software from and other vendors at below invoice price.

South Australian-based HiTech Distribution had raised the OEM issue with MYOB after receiving several complaints from resellers, HiTech marketing manager, David Hein, said.

Resellers had spotted retail advertisements for MYOB product at prices considerably lower than wholesale, he said.

MYOB had also received complaints from end-users who had been sold unauthorised products after a promotional campaign run before Christmas, Ferrigno said. But he played down the extent of the problem, claiming the vendor had only received a handful of complaints from SA, WA and Queensland.

The company will tackle the problem by tightening up its OEM terms and conditions.

Ferrigno told resellers the company was putting together new dealer agreements clarifying that OEM software must only be sold bundled with laptop or desktop PC systems.

MYOB’s OEM software will soon ship with yellow stickers on the instruction manual and shrink wrap packaging, stating that the product is OEM software and that unauthorised sale could void registration.

The vendor has also referred several instances of possible trademark violation to its legal service after spotting unauthorised reseller advertisements using the MYOB name and logo on their websites.

Ferrigno declined to name any businesses suspected of dealing in unauthorised OEM software, but told resellers that queries directed to those traders had established that they weren’t holding MYOB stock, but were taking customer deposits and then attempting to obtain the product from other traders.

“It is quite obvious that they are using our well-known brand name to create traffic into their stores and websites in an effort to sell their own hardware packages,” Ferrigno said. “We have to protect end-users from this kind of thing where we can.”

While it was hard to estimate how much business might have been lost to traders passing off OEM software as retail product, Hein was satisfied that MYOB had taken action quickly.

“I think they are taking it pretty seriously,” he said.

MYOB was not alone in the war against unauthorised product, managing director of Adelaide-based Berlin Wall Software, Rob Beaumont, said.

He had observed websites advertising software including games and business tittles at below cost price.

“Some of our suppliers are not actually dealing with them and wondering where they are getting their stock from and why so cheap,” Beaumont said.

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