So retail owners like to make a few bucks, some just like to make a few more.I have worked in retail, the owner had a 60% profit on everything, but thats not unusual.
Hardcore Biker
So retail owners like to make a few bucks, some just like to make a few more.I have worked in retail, the owner had a 60% profit on everything, but thats not unusual.
Forum whore
That would be nice! Something to think about, though is that out of that profit margin have to come all the business running costs before the boss gets anything. I'm fortunate in that I don't have staff or premises to pay for. Add in wages for a couple of people, rental and insurance for the building, vehicle costs if you have a couple of vehicles, and the costs spiral up at a remarkable rate! Office equipment and supplies, your accountatnt wants his pound of flesh, legal costs, provisional tax if that's due, which means basically you pay your tax in advance...Originally Posted by bsasuper
Out of that 60% profit margin the boss probably gets, oh, say, .5%..?
A very popular and "successful" business I know of, (actually I know of a couple of them), is being cripppled by slow payment of its accounts as customers are struggling, add in one disgruntled customer who refuses to pay despite being do far in the wrong it is laughable, and not only did they fail to make Director's fees last month for themselves but are in danger of bankruptcy. They have little option but to take this customer to court, which they will win, but then he has to honour the judgement, by that time it could well be too late. Wher are they going to get the money to take this guy to court when they can't even afford drawings for themselves? He's their biggest debtor and very rich, and has obviously played this game before.
Businessmen have to balance their tax obligations and do a lot to minimise their tax liability which can then work against them. For example, you may work at a loss to get GST back, and avoid paying provisional tax. Making a profit means paying tax on it so many run their businesses to show little or no profit. That's fine until something like the above comes up and there isn't enough in the bank to cover the immediate shortfall. Or you have an accident and ACC won't pay diddly-squat as your drawings were nil or minimal and 80% of stuff-all is not very much. Fortunately they do now have a minimum payment to business persons in this situation or I would have had no income at all for the last 18mths.
Personally, while I am investing heavily into the business and running at a significant loss to date, my plan is to build a financial cushion and have assets behind me. I'd rather pay tax than find myself in a position where I have had a setback that I can't cover.
You don't get to be an old dog without learning a few tricks.
Shorai Powersports batteries are very trick!
Highway Biker
As far as customs is concerned they dont care who does the importing.
Tariffs and taxes, if applicable are charged irrespective of who is importing and why they are importing
As far as tax returns, gst etc thats all to do with the tax department, nothing to do with customs. Any gst they charge is on behalf of IRD and normal gst rules apply ie a gst registered entity can claim any gst paid and pays any gst charged.
I know a lot of small business have posted whining about all the costs they face, but they are only telling half the story.
eg
If you imported a single helmet, $300, it would turn up on your doorstep without customs getting involved.
If a business imported a single helmet, $300, it would turn up on their doorstep without customs getting involved.
The difference is if you sold the helmet you would have to sell it for $300 to break even.
The business would have to sell it for $300 + gst to break even.
If you imported ten helmets, $3000, customs would be involved and you would be paying customs fees/charges and gst
If a business imported ten helmets, $3000, customs would be involved and they would be paying customs fees/charges and gst
In this case both of you would have to sell at $300 + gst (+ share of fees) to break even
Generally speaking if the value of the import is less than $400 customs dont charge anything. Costs them more in time and paperwork than what they get back from the importer.
The reason business get charged by customs is because they generally bring in a whole swag of gear at once, pushing the value of the import over the customs threshold
The disadvantage is they are up for customs charges and gst
The advantages are
a better buy price for bulk buy
freight per item is way down
customs fees & charges are tax deductible
gst is refunded in total and only has to be paid as individual items are sold
So its not as bad as they try and make out, if it was they would import things one at a time like a private importer normally does.
As has already been stated, in many cases its too many people clipping the ticket that drives up prices in NZ.
It is tough for business out there, but thats life. Business has to get smarter rather than whinge about the internet.
Forum whore
Eh? I didn't notice any small businesses whining on here...
I have been explaining how importing and general business works and hope that by doing so others get a better understanding of business in NZ. I have also pointed out that my own pricing is very close to the US price, and in one given example my price beats the US price by quite a bit.
By the way, do you run, or have you run your own business and can speak from first hand knowledge? The two businesses I mentioned in financial strife are due to customers not paying, nothing to do with the internet at all. It was an aside.
You don't get to be an old dog without learning a few tricks.
Shorai Powersports batteries are very trick!
Forum whore
I know that isn't to do with Customs, just more of a question around if you're a registered business and therefore on the Govt books, so to speak, you'd be then required to pay duty/GST on all imports, rather than just that above the $400/$50GST threshold that a private individual would have.
Where's the ride?
Two big problems with all that.
Firstly, you are being fcuked over by your NZ supplier if they are forbidding you to order low quantities of low-demand products, and you in turn are then fcuking over your customers. The pair of you need to sort your shit out.
Secondly, what on earth makes you think there'd be an uproar if you had to get stuff ex-USA??? I get real tired of hearing about inventory costs being to blame for the prices, because 90% of the time the dealer never bloody has what I need and has to order it in. I don't give a shit about local inventory, ok? I'd rather wait 3-4 working days to get something ex-USA than wait 10-15 working days ex-factory (or even 2-3 days from NZ distributor) and pay three times the price.
I've said it before. Dealers should be able to access inventory in dealerships in the USA, Aussie, UK, wherever, clip the ticket, and supply at a reasonable price and profit in a few days. (Treat dealers worldwide as a distributed warehouse.) There is no need to persist with the outdated geo-political boundaries in the sales model... as is obvious from these threads, it's a lose-lose situation.
Cheers,
Colin
Where's the ride?
I don't expect the same price, but neither am I prepared to be shafted just because that's the traditional business model. 2-3 times the private import price is just too much.
Cheers,
Colin
Hardcore Biker
Yep about right, lots of bills and wages to pay.
Royal Enfield user
agreed whole heartedly , the old business models are out the window ,in some area they may work but in others they are like the Dodo and my sex life , extint
I personally thing ALL retail outlets need to step back and have a good look at why or what they are ACTUALLY doing, Bike shops for example ( IMHO ) should now be facilitating entertainment , the clothing and spares and repair being secondary
As for this ordering parts stuff , the bike shop should tack on a premium for KNOWLEDGE and EXPERIENCE allowing the customer to get the right part cheaply , through the shop FROM overseas, and in some cases I think they are already doing that
the bikes are too reliable now a days , entertainment is where its at
anyway its my money , and it will stay in my wallet , until i am happy
end of story
Stephen
"Look, Madame, where we live, look how we live ... look at the life we have...The Republic has forgotten us."
Highway Biker
The threshhold applies to business importers as well.
Forum whore
Do any of the detractors on this thread drink at a Bar?
Ever start arguments with staff/owners there about mark ups?
I can imagine it now...
CUSTOMER
" nine bucks for a Beer!... I can buy this same beer in a bottle store for less than a buck..... Your ripping me off"
BAR STAFF/OWNER
" Fuck off then"
Highway Biker
Import and export.
The two businesses in financial strife, another outmoded business practice, credit.
If a bank wont give a customer credit why should you?
troglodytam extraordinaire
That's why I don't drink at a bar.
Forum whore
You are right to a degree, but (correct me if I am wrong), you don't actually operate your imported bike gear business FULL TIME, and (again correct me if I am wrong), saw what you BELIEVED to be a "gap in the market" for bike gear, and, PART TIME, operate said business.
I have seen innumerable posts by yourself condemning "inferrior" branded bike gear, claiming it to be "over priced" (and so on).
To me, for you to come off as high and mighty as to members of the public bringing in their own stuff, as opposed to buying it from you is simply a case of the Pot calling the kettle black" ..... It could be said that you yourself have actually harmed existing bike shops long term viability by setting up a part time imported bike gear business, competing on "best quality for best price"
Before you get your back up though, and to put this into perspective, can you answer me this.
Approximately, how much would you have to RAISE your retail prices to be able to simply maintain your current lifestyle if you where to "quit your day job", and live solely off the gear sales....... 30%..40%.... more???????
Forum whore
I agree with you to an extent. My business is a cash business, you pay me for the item, I deliver with a receipt, end of transaction. I have to pay up front for my stock, freight and GST before I can receive it, so I think it's only fair that everyone else does the same. That way I don't have debtors owing me money.
The two other businesses work in a different sphere though with much larger transactions and longer delivery times. A job may take several weeks to complete and cost 10's of thousands of dollars. They work on progress payments in the main. I do think that in such situtations the customer should, as you suggest, take out a loan or mortgage from their bank to pay for the work. However in one case, the customer is deliberately refusing to pay with no legal right to withold payment.
You don't get to be an old dog without learning a few tricks.
Shorai Powersports batteries are very trick!
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