GST etc on imports

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#962344 7-Jan-2014 10:21

trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

MikeB4

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#962347 7-Jan-2014 10:26

Klipspringer:
trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

Sales are a means of clearing old stock or to attract foot traffic, the prices are unsustainable in the long term but are a calculated risk. It is a myth that profit margins in NZ are high, in fact the opposite applies, especially in tech products the margins are very very low and are often sold at zero to negative margin in order to gain other business.

Retailers like anyone else in business need to make a profit, no profit no investment. No investment no jobs thus the drain is circled.

Another way to look at it, would a 50% permanent pay cut be sustainable for you ?

trig42

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#962352 7-Jan-2014 10:55

Klipspringer:
trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

Where do you get that from?

In places like Briscoes, or furniture shops, that may be true. Furniture stores have to hold a lot of valuable stock for a long time (low stock turn) and we all know what Briscoes tactics are - when was the last time you bought anything from there that wasn't on sale?

I can guarantee that the RRP of a TV is nowhere near double its cost price.

The cost price of an iPhone to a retailer is about $30-40 less than the RRP (meaning about 3-4% for the retailer). iPads and iPods not much better as a percentage, lower in most cases in $$ terms.

It costs money to have stores in malls, on streets, employing people that pay taxes and keep the economy going round.

I think you may find that most retailers profit margins are only around 10-20% (20% would be excellent, and any electronics retailer would crawl over glass for it). If that is huge, grossly high or outrageous to you, then I do not know how any of them would even be able to open their doors in your world.

Geektastic

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#962357 7-Jan-2014 11:04

trig42:
Klipspringer:
trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

Where do you get that from?

In places like Briscoes, or furniture shops, that may be true. Furniture stores have to hold a lot of valuable stock for a long time (low stock turn) and we all know what Briscoes tactics are - when was the last time you bought anything from there that wasn't on sale?

I can guarantee that the RRP of a TV is nowhere near double its cost price.

The cost price of an iPhone to a retailer is about $30-40 less than the RRP (meaning about 3-4% for the retailer). iPads and iPods not much better as a percentage, lower in most cases in $$ terms.

It costs money to have stores in malls, on streets, employing people that pay taxes and keep the economy going round.

I think you may find that most retailers profit margins are only around 10-20% (20% would be excellent, and any electronics retailer would crawl over glass for it). If that is huge, grossly high or outrageous to you, then I do not know how any of them would even be able to open their doors in your world.

Shoes and clothes have huge markups. I bought some North Face trainers that are almost $150 more here than the same shoes in the USA. Likewise, my brother can buy Levis in the USA for $25 that cost $150 here.

Surefire flashlights - I bought one in the USA for $145 that retailed through the NZ agent at over $700!

MikeB4

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#962369 7-Jan-2014 11:37

Geektastic:
trig42:
Klipspringer:
trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

Where do you get that from?

In places like Briscoes, or furniture shops, that may be true. Furniture stores have to hold a lot of valuable stock for a long time (low stock turn) and we all know what Briscoes tactics are - when was the last time you bought anything from there that wasn't on sale?

I can guarantee that the RRP of a TV is nowhere near double its cost price.

The cost price of an iPhone to a retailer is about $30-40 less than the RRP (meaning about 3-4% for the retailer). iPads and iPods not much better as a percentage, lower in most cases in $$ terms.

It costs money to have stores in malls, on streets, employing people that pay taxes and keep the economy going round.

I think you may find that most retailers profit margins are only around 10-20% (20% would be excellent, and any electronics retailer would crawl over glass for it). If that is huge, grossly high or outrageous to you, then I do not know how any of them would even be able to open their doors in your world.

Shoes and clothes have huge markups. I bought some North Face trainers that are almost $150 more here than the same shoes in the USA. Likewise, my brother can buy Levis in the USA for $25 that cost $150 here.

Surefire flashlights - I bought one in the USA for $145 that retailed through the NZ agent at over $700!

Direct price comparisons cannot be made, one needs to check, origin taxes, cost of shipping, exchange rates applicable at time of purchase, import duties and GST.

There are some products that do seem to have higher than expected prices but that is not the norm.

TinyTim

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#962371 7-Jan-2014 11:43

sbiddle:
We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

A large US department store has found just this: they had got themselves into the rut of only selling about 5% of their products at full price, so decided to reduce their full non-sale price to the typical everyday 40%-off sale price, and have fewer sales.

It didn't work - nobody bought anything, even though the price was the same.

Geektastic

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#962384 7-Jan-2014 12:08

KiwiNZ:
Geektastic:
trig42:
Klipspringer:
trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

Where do you get that from?

In places like Briscoes, or furniture shops, that may be true. Furniture stores have to hold a lot of valuable stock for a long time (low stock turn) and we all know what Briscoes tactics are - when was the last time you bought anything from there that wasn't on sale?

I can guarantee that the RRP of a TV is nowhere near double its cost price.

The cost price of an iPhone to a retailer is about $30-40 less than the RRP (meaning about 3-4% for the retailer). iPads and iPods not much better as a percentage, lower in most cases in $$ terms.

It costs money to have stores in malls, on streets, employing people that pay taxes and keep the economy going round.

I think you may find that most retailers profit margins are only around 10-20% (20% would be excellent, and any electronics retailer would crawl over glass for it). If that is huge, grossly high or outrageous to you, then I do not know how any of them would even be able to open their doors in your world.

Shoes and clothes have huge markups. I bought some North Face trainers that are almost $150 more here than the same shoes in the USA. Likewise, my brother can buy Levis in the USA for $25 that cost $150 here.

Surefire flashlights - I bought one in the USA for $145 that retailed through the NZ agent at over $700!

Direct price comparisons cannot be made, one needs to check, origin taxes, cost of shipping, exchange rates applicable at time of purchase, import duties and GST.

There are some products that do seem to have higher than expected prices but that is not the norm.

Cost of shipping in some cases should be lower.

For example let us assume a large standard shipping container will hold 1000 pairs of shoes in boxes (no idea how many it holds - it's just an assumption)

Let us take North Face shoes which are made in China. Shipping distances to New York are longer than to Auckland. As far as I know, there is no FTA between the US and China either, so I presume we here in NZ should benefit in some way from reduced paperwork etc as a result of that. Shipping to the EU would be even further.

Thus the per unit shipping cost to NZ should be a lot less than to CONUS or the EU. I shipped a container here when I moved and it was only about $2000 from the UK - equal to $2 per shoe box in my example.

VAT (GST) is higher in the UK at 20%. The shoes I paid NZ$250 for are usually GBP110 or NZ$217 including 20% tax. Knock off another 5% to equalise the tax rates and the UK shoes are $206 despite travelling 17,780km by sea to say Bristol from China as opposed to only 9500km by sea to Auckland. Shipping is not IMV a major factor in *most* cases - anything which is relatively simple to ship by container from China or SE Asia should have lower shipping costs than items to the EU.

Shipping to New York by sea is even longer from China at 20,590km so shipping should add even more there.

Of course it is not quite that simplistic but we should all at least question very hard when people claim "we are so far away so shipping costs more"!

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Shop now on Samsung phones, tablets, TVs and more (affiliate link).

trig42

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#962387 7-Jan-2014 12:20

Geektastic:
KiwiNZ:
Geektastic:
trig42:
Klipspringer:
trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

Where do you get that from?

In places like Briscoes, or furniture shops, that may be true. Furniture stores have to hold a lot of valuable stock for a long time (low stock turn) and we all know what Briscoes tactics are - when was the last time you bought anything from there that wasn't on sale?

I can guarantee that the RRP of a TV is nowhere near double its cost price.

The cost price of an iPhone to a retailer is about $30-40 less than the RRP (meaning about 3-4% for the retailer). iPads and iPods not much better as a percentage, lower in most cases in $$ terms.

It costs money to have stores in malls, on streets, employing people that pay taxes and keep the economy going round.

I think you may find that most retailers profit margins are only around 10-20% (20% would be excellent, and any electronics retailer would crawl over glass for it). If that is huge, grossly high or outrageous to you, then I do not know how any of them would even be able to open their doors in your world.

Shoes and clothes have huge markups. I bought some North Face trainers that are almost $150 more here than the same shoes in the USA. Likewise, my brother can buy Levis in the USA for $25 that cost $150 here.

Surefire flashlights - I bought one in the USA for $145 that retailed through the NZ agent at over $700!

Direct price comparisons cannot be made, one needs to check, origin taxes, cost of shipping, exchange rates applicable at time of purchase, import duties and GST.

There are some products that do seem to have higher than expected prices but that is not the norm.

Cost of shipping in some cases should be lower.

For example let us assume a large standard shipping container will hold 1000 pairs of shoes in boxes (no idea how many it holds - it's just an assumption)

Let us take North Face shoes which are made in China. Shipping distances to New York are longer than to Auckland. As far as I know, there is no FTA between the US and China either, so I presume we here in NZ should benefit in some way from reduced paperwork etc as a result of that. Shipping to the EU would be even further.

Thus the per unit shipping cost to NZ should be a lot less than to CONUS or the EU. I shipped a container here when I moved and it was only about $2000 from the UK - equal to $2 per shoe box in my example.

VAT (GST) is higher in the UK at 20%. The shoes I paid NZ$250 for are usually GBP110 or NZ$217 including 20% tax. Knock off another 5% to equalise the tax rates and the UK shoes are $206 despite travelling 17,780km by sea to say Bristol from China as opposed to only 9500km by sea to Auckland. Shipping is not IMV a major factor in *most* cases - anything which is relatively simple to ship by container from China or SE Asia should have lower shipping costs than items to the EU.

Shipping to New York by sea is even longer from China at 20,590km so shipping should add even more there.

Of course it is not quite that simplistic but we should all at least question very hard when people claim "we are so far away so shipping costs more"!

True, but how many boxes of North Face shoes is the UK importer buying off North Face compared to how many the NZ importer is buying? That is where the differences lie in those sort of items - the NZ market is just not big enough (and, on Shoes and Clothes, there is a 10% duty to add to your prices).

And, you are assuming that to shift a container around the world is based only on distance travelled - many more ships would travel from China to EU than from China to NZ.

Satch

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#962392 7-Jan-2014 12:29

KiwiNZ: Direct price comparisons cannot be made, one needs to check, origin taxes, cost of shipping, exchange rates applicable at time of purchase, import duties and GST.

There are some products that do seem to have higher than expected prices but that is not the norm.

While I agree with you in principle, the simple fact that this is now getting a lot of media attention and debate suggests that there are many items here which do have higher than expected prices. If this were not the case then people wouldn't be bypassing local retailers and importing goods for personal use instead?

Geektastic

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#962393 7-Jan-2014 12:33

trig42:
Geektastic:
KiwiNZ:
Geektastic:
trig42:
Klipspringer:
trig42:
sbiddle: Lets go back a few steps and look at why the retail market in NZ is screwed - it's because of retailers like Kathmandu who pioneered the concept of selling large quantities of their stock at "50% off" by hiking up the everyday retail. People fell for this so the concept simply grew and we're now seeing the likes of Briscoes, Farmers etc all following.

We now have a mass market of people that won't buy something unless it's got a 50% off sticker on it which has basically resulted in a very screwed retail sector.

This.

Nearly all retailers are doing it. I now no longer am even interested when a Noels or Harvey Norman have 20% off Computers or TVs, because it's 20% off what??? Some ridiculously high price that no sane person would ever pay? Same with Briscoes/Rebel Sport, why don't they just close their stores on days without a sale (is there such a day?)?

There are a couple of retailers that do have everyday low prices, or their % off sales are off already lowered prices (JB quite commonly do this).

If shops can afford to drop their price by 50% during sales its a sure sign that customers are getting ripped off every single other day of the year.

It boggles my mind why retailers in this country have such a high profit margin. The price of everything is in most cases double the cost.

Where do you get that from?

In places like Briscoes, or furniture shops, that may be true. Furniture stores have to hold a lot of valuable stock for a long time (low stock turn) and we all know what Briscoes tactics are - when was the last time you bought anything from there that wasn't on sale?

I can guarantee that the RRP of a TV is nowhere near double its cost price.

The cost price of an iPhone to a retailer is about $30-40 less than the RRP (meaning about 3-4% for the retailer). iPads and iPods not much better as a percentage, lower in most cases in $$ terms.

It costs money to have stores in malls, on streets, employing people that pay taxes and keep the economy going round.

I think you may find that most retailers profit margins are only around 10-20% (20% would be excellent, and any electronics retailer would crawl over glass for it). If that is huge, grossly high or outrageous to you, then I do not know how any of them would even be able to open their doors in your world.

Shoes and clothes have huge markups. I bought some North Face trainers that are almost $150 more here than the same shoes in the USA. Likewise, my brother can buy Levis in the USA for $25 that cost $150 here.

Surefire flashlights - I bought one in the USA for $145 that retailed through the NZ agent at over $700!

Direct price comparisons cannot be made, one needs to check, origin taxes, cost of shipping, exchange rates applicable at time of purchase, import duties and GST.

There are some products that do seem to have higher than expected prices but that is not the norm.

Cost of shipping in some cases should be lower.

For example let us assume a large standard shipping container will hold 1000 pairs of shoes in boxes (no idea how many it holds - it's just an assumption)

Let us take North Face shoes which are made in China. Shipping distances to New York are longer than to Auckland. As far as I know, there is no FTA between the US and China either, so I presume we here in NZ should benefit in some way from reduced paperwork etc as a result of that. Shipping to the EU would be even further.

Thus the per unit shipping cost to NZ should be a lot less than to CONUS or the EU. I shipped a container here when I moved and it was only about $2000 from the UK - equal to $2 per shoe box in my example.

VAT (GST) is higher in the UK at 20%. The shoes I paid NZ$250 for are usually GBP110 or NZ$217 including 20% tax. Knock off another 5% to equalise the tax rates and the UK shoes are $206 despite travelling 17,780km by sea to say Bristol from China as opposed to only 9500km by sea to Auckland. Shipping is not IMV a major factor in *most* cases - anything which is relatively simple to ship by container from China or SE Asia should have lower shipping costs than items to the EU.

Shipping to New York by sea is even longer from China at 20,590km so shipping should add even more there.

Of course it is not quite that simplistic but we should all at least question very hard when people claim "we are so far away so shipping costs more"!

True, but how many boxes of North Face shoes is the UK importer buying off North Face compared to how many the NZ importer is buying? That is where the differences lie in those sort of items - the NZ market is just not big enough (and, on Shoes and Clothes, there is a 10% duty to add to your prices).

And, you are assuming that to shift a container around the world is based only on distance travelled - many more ships would travel from China to EU than from China to NZ.

Given that no significant (economically) shoe or clothes making exists here in NZ, why exactly do we have a 10% tax on these things over and above GST I am wondering...

MikeB4

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#962396 7-Jan-2014 12:39

TBH I don't know why the duty on types of clothes is still there. If memory serves me correctly it was lebied by the Muldoon Government as they were seen as luxuries and to protect local industry.

Geektastic

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#962445 7-Jan-2014 14:10

KiwiNZ: TBH I don't know why the duty on types of clothes is still there. If memory serves me correctly it was lebied by the Muldoon Government as they were seen as luxuries and to protect local industry.

I can see how not being naked and barefoot could be considered a luxury.....oh no - wait - I can't!

Muldoon was BMT but sounds like an oddball.

Satch

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#962446 7-Jan-2014 14:18

Let the Government start imposing GST on ALL imports on the following proviso:

1. They don't charge exorbitant fees like they currently do (unlikely to happen I know)
2. My tax give (income and GST) doesn't increase to pay for GST collection across the board
3. Retailers stop complaining that people continue to import goods rather than buying local when they realise that GST isn't the issue (again, unlikely to happen)

MikeB4

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#962451 7-Jan-2014 14:27

Geektastic:
KiwiNZ: TBH I don't know why the duty on types of clothes is still there. If memory serves me correctly it was lebied by the Muldoon Government as they were seen as luxuries and to protect local industry.

I can see how not being naked and barefoot could be considered a luxury.....oh no - wait - I can't!

Muldoon was BMT but sounds like an oddball.

Muldoon was to put it politely, odd and his fiscal policy flawed. NZ back in those days was a mess and all but bankrupt.

richms

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#962492 7-Jan-2014 15:10

You will find with ordering containers of stuff from china that unless you are taking a container of exactly the same product - so for shoes that would be style, colour, size, packaging etc that you will not be getting a container from the factory directly to you, it will have to go via consolidators who will sit on the partial loads for weeks-months at a time till they have your entire shipment ready to re-pack into containers and send to you.

A friend was looking at bringing in furniture and interior lighting. Basically he would have to have a container of chairs from one place, a container of the matching sofa from another place, with them arriving weeks apart unless he wanted to basically end up spending over double on the items, landed in NZ because they dont ship like that from the factory. Even getting a proper NZ plug on lights was basically requiring to commit to a few 100 of each design of lamp, unless they were also doing another run for someone in aussie.

It was going to be even more if he wanted to get custom branding etc on the items, which they would do on small runs but at a considerable cost. Without paying that you would get the generic ugly Chinese designed packaging.

NZ is just too smaller market to support that for anyone but the warehouse or similar

Richard rich.ms

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