The GST con story

[Ocean1]

Imagine the inconvenience of not being able to get anything that day. Imagine not getting the items you wanted for up to a week. Imagine not receiving the right item, or it was the wrong size, shape or colour. Imagine buying a present for a birthday or a special occasion and it didn't turn up.

I don't have to imagine it, that's more or less what NZ had before most import duties and tariffs were removed. Local producers simply weren't servicing the market, it seemed like they were basically taking the piss, you took what they offered or got fucked because there simply wasn't any alternative.

And now we see that again overseas suppliers can do the job for half the price. Should we rebuild protections for local suppliers? They do keep the money in town. But probably not as much as paying an off-shore business half as much in the first place.

I've got a lot of sympathy for the locals in some industries, and I don't fully understand why they can't source product at "wholesale" prices low enough to be able to retail at a profit, but that does seem to be the case in some instances. But the fact is a fuckload of your average Kiwi's workload goes into paying the tax that's supposed to be helping local charities, and the money saved by buying off-shore leaves a deal of cash in the pocket to help subsidise the local clubs directly.

[scrivy]

and the money saved by buying off-shore leaves a deal of cash in the pocket to help subsidise the local clubs directly.

I wish that was the case Ocean, but even charities/clubs/schools are struggling from decreased donations....

[Ocean1]

I wish that was the case Ocean, but even charities/clubs/schools are struggling from decreased donations....

Can show me? I'm not calling you on it, it's just easy to see a few examples and an article in the local rag and extend that perception across the whole country/sport/school/decade.

I'm at least as careful with my own perceptions that middle NZ is complaining far more about their std of living than they used to, in spite of the fact that most impartial measures show that it's never been so good.

Even then, more so than I can ever remember every bit of "evidence" you find seems to have been produced by someone with an interest in the game, so you end up with "evidence" worth fuck all. I usually ignore everything from anyone with any interest at all but it's becoming increasingly common to find that the link to the source has been hidden.

[Woodman]

I don't have to imagine it, that's more or less what NZ had before most import duties and tariffs were removed. Local producers simply weren't servicing the market, it seemed like they were basically taking the piss, you took what they offered or got fucked because there simply wasn't any alternative.

And now we see that again overseas suppliers can do the job for half the price. Should we rebuild protections for local suppliers? They do keep the money in town. But probably not as much as paying an off-shore business half as much in the first place.

I've got a lot of sympathy for the locals in some industries, and I don't fully understand why they can't source product at "wholesale" prices low enough to be able to retail at a profit, but that does seem to be the case in some instances. But the fact is a fuckload of your average Kiwi's workload goes into paying the tax that's supposed to be helping local charities, and the money saved by buying off-shore leaves a deal of cash in the pocket to help subsidise the local clubs directly.

The NZ market is so small and doesn't hardly register on most overseas wholesalers radar. For instance the company I work for which has about 100 outlets in NZ is 1% of our US based parent company. The parent company has the highest market share in the US, which is 10%, and thats only the US and its a global industry, so work out what the percentage the NZ business is globally. That is why some NZ companies cannot get decent wholesale costs from overseas suppliers. Too small.

[scrivy]

Can show me? I'm not calling you on it, it's just easy to see a few examples and an article in the local rag and extend that perception across the whole country/sport/school/decade.

I'm at least as careful with my own perceptions that middle NZ is complaining far more about their std of living than they used to, in spite of the fact that most impartial measures show that it's never been so good.

Even then, more so than I can ever remember every bit of "evidence" you find seems to have been produced by someone with an interest in the game, so you end up with "evidence" worth fuck all. I usually ignore everything from anyone with any interest at all but it's becoming increasingly common to find that the link to the source has been hidden.

As per your above post, there are links to pros and cons on the debate. So it's hard to get an impartial/unbiased report worth anything. But what I do know, is that my local radio stations and newspapers are struggling for advertisers from the local businesses - fact. I was the financial person on my school board for 8 years, and we were getting less and less school 'donations', and even less sponsorship and giveaways for school events etc for the PTA.
One only has to look around at the empty shops everywhere in regional NZ, and also the amount of people that were once fully employed that are now coming in to me looking for jobs, because the business they were in went tits up.....

It's fucken sad out there, it really is.....

[avgas]

Let's imagine a world where there are no local shops. Imagine the inconvenience of not being able to get anything that day. Imagine not getting the items you wanted for up to a week. Imagine not receiving the right item, or it was the wrong size, shape or colour. Imagine buying a present for a birthday or a special occasion and it didn't turn up.

I actually have exactly that situation right now. It's not as doom and gloom as it sounds.

Through Amazon Prime, as service I pay for at $80/year. I get FREE 2 day shipping, and the shipping is guaranteed to arrive on time. I also have a refund and return policy that costs me nothing.

Additional to this I get free movies to watch, free music to listen to, and discounted rates for other things.

So its not all doom and gloom. But I think there needs to be a balance of buying local and shipping stuff in. Its allowing for that balance which is the hard part it seems. They seem to want to block one or allow the other.

[Ocean1]

The NZ market is so small and doesn't hardly register on most overseas wholesalers radar. For instance the company I work for which has about 100 outlets in NZ is 1% of our US based parent company. The parent company has the highest market share in the US, which is 10%, and thats only the US and its a global industry, so work out what the percentage the NZ business is globally. That is why some NZ companies cannot get decent wholesale costs from overseas suppliers. Too small.

Yes NZ is a small market, but that only explains some of the price differences. Explain to me why an American individual can buy a Dell desktop out of a Singapore warehouse for half the price I can. As far as the manufacturer is concerned the supply cost is nearly identical.

What I'm struggling to understand is what causes the rest of the difference. I can see advantages to the US economy generally in almost every price comparison of US product there and here, there's no overt trade barriers in place and yet the real-world effect is exactly that of a trade barrier/sanction: US product prices off-shore are subsidising US product prices at home.

As for domestic retail, if they can't add value to the product they really can't expect to charge any more for it, can they? Technology always changes the world, in this case it's taken a while but the effect is to allow you more direct access to the manufacturer, and I can't really see that as a bad thing.

[Ocean1]

As per your above post, there are links to pros and cons on the debate. So it's hard to get an impartial/unbiased report worth anything. But what I do know, is that my local radio stations and newspapers are struggling for advertisers from the local businesses - fact. I was the financial person on my school board for 8 years, and we were getting less and less school 'donations', and even less sponsorship and giveaways for school events etc for the PTA.
One only has to look around at the empty shops everywhere in regional NZ, and also the amount of people that were once fully employed that are now coming in to me looking for jobs, because the business they were in went tits up.....

It's fucken sad out there, it really is.....

But it's not all sad out there. Most measures of living standards have us improving. GDP is increasing. Average wages are increasing. Job numbers are increasing. Health spending is increasing, and if that's having less effect on actual health it's because we're eating a lot more and exercising a fucking sight less.

Shops have been emptying in outer suburbia and rural towns for decades, a symptom of the ease with which people can mail order or head into the city for stuff. Schools I can't really comment on, other than to say that my kids schools were saying the same thing 25 years ago. Any time you've got an artificial market you get strange side effects, and schools are as artificial as they come: there's little link between supplier and user.

Radio and newspapers? Meh, dying industries, hardly surprising.

So if you're seeing a genuine measurable drop in local living standards then it's just that: local.

The trend I don't like is the growth in the size of market-dominant companies in most areas. They can make product more cheaply available to the end-user than smaller local companies do, but it's a double edged sword, give them enough scope by allowing them to limit their competition and they'll abuse their position.

That's the commerce commission's job, of course: to prevent market monopolies, price fixing and a lot of other anti-competitive behaviours. It seems increasingly that they're not having the desired effect. Maybe we need to either change the rules a bit or get a bigger stick onto the job.

The other thing is the loss of unskilled jobs, either through the loss of industries to places where labour is cheaper or through automation. Basically: get used to it, it's not going to change, 95% of the world would literally kill for the factory jobs we had available here 30 years ago. And automation is my thing, I'm probably personally responsible for the loss of thousands of labouring jobs over the years. Again, don't expect that to do anything but accelerate.

The fix? Make fucking sure that your education includes skills the world wants. It's really that simple. If you expect to earn a living without such a skill then you're the cause of you're own downfall, don't expect too much help from those that did do their homework.

[Voltaire]

As per your above post, there are links to pros and cons on the debate. So it's hard to get an impartial/unbiased report worth anything. But what I do know, is that my local radio stations and newspapers are struggling for advertisers from the local businesses - fact. I was the financial person on my school board for 8 years, and we were getting less and less school 'donations', and even less sponsorship and giveaways for school events etc for the PTA.
One only has to look around at the empty shops everywhere in regional NZ, and also the amount of people that were once fully employed that are now coming in to me looking for jobs, because the business they were in went tits up.....

It's fucken sad out there, it really is.....

That's a good example, Radio stations and Newspapers only exist to sell advertising by attracting listeners with tunes, so called news and prizes.
If Radio TV and Newspapers stopped tomorrow would anyone really miss them?
Pretty much replaced by the internet.
" oh but what about all the jobs in Radio and TV"
What about all the Blacksmith and telephone exchange operators....typists.. and the tram drivers.... and so on.
IT are screaming out for staff.

[Ocean1]

I actually have exactly that situation right now. It's not as doom and gloom as it sounds.

Through Amazon Prime, as service I pay for at $80/year. I get FREE 2 day shipping, and the shipping is guaranteed to arrive on time. I also have a refund and return policy that costs me nothing.

Additional to this I get free movies to watch, free music to listen to, and discounted rates for other things.

So its not all doom and gloom. But I think there needs to be a balance of buying local and shipping stuff in. Its allowing for that balance which is the hard part it seems. They seem to want to block one or allow the other.

I think there's a natural balance there, if you don't strangle it too much with market controls. Where a local supplier can genuinely add value to the product he's sourcing then he'll survive just fine, as long as the big boys don't kneecap him.

Some of those big boys aren't amenable to NZ rules of commerce though, they don't live here. That's the real penalty in being such a small fish I guess, you can't impose too many conditions on the terms at the trade agreement table.

I'm trying to think how many of the more recent boom economies could trace their success to a single, large scale industry domination. Would make for better terms in that one industry, in turn making for better overall national terms of trade results than half-arsed development across the board.


Edit: and then I remember Finland/Nokia, Ireland, etc. Relying too much on one good hand can be risky...

[Ocean1]

IT are screaming out for staff.

I'd be happy with a couple of reliable senior engineers.





Edit: Not really, I'd have to work harder to keep them busy, and I don't want to.

[Scuba_Steve]

Try TSB...
Try PakNslave
Try Gull

Maybe........

What about the feed in PakNSave? Ain't all from NZ, in-fact most isn't; or does the country of production not matter in you rants only the shop where it is brought?
Gull - Gull Petroleum is a Perth, Western Australian based petroleum company, which retails fuel in Western Australia and New Zealand.
And what brands are on the clothes you wear? I hope there's no "made in China/Vietnam/Thailand" on those threads that would be sorta hypocritical wouldn't it.

[ellipsis]

...I would love to buy locally and often do, but sometimes the let downs from 'struggling local business', is frustrating and often their attitudes to you, the local buyer is appalling...an hour and a half wasted on the phone recently to try and track down a fairly common part for a fairly common tool...I tracked it down to one supplier who quoted me 90 something bucks, but they would not be able to get one for two weeks, why, because thats the next time the agent will be in...found one in stock at a slightly larger locally owned business, 140 bucks...I mentioned the descrepancy in price, the reply , 'we have one in stock , take it or leave it'...fuck your attitude I thought...found another small struggling local bizzo, very helpful, 'I'll track one down and call you back tomorrow, shouldn't be a prob', under a hundred bucks...never called me back, phoned again, 'sorry, I got held up, phone you back this arvo'...two months ago that was...got the part delivered for 45 bucks from a local chap who got it for me online and made his bit on the purchase...I would still prefer to shop locally , but why, I don't know...I'm a mug maybe...

[R650R]

Well some interesting replies here. Seems not just the almighty dollar and the 15% margin of GST but service matters highly too.
Something else too, before the internet petrol was only 80ish cents a litre parking was just about free everywhere and you thought nothing off nipping into town to grab a specific item.
Since then you now have highly increased enforcement of rego and wof (I'm sure everyone gets caught out from tiem to tiem with schedules) that you cant risk shopping for that $50 part when you might get $400 fines picking it up.
Also since then our dollar has shifted hugely in value against the USA and other currencies.

So just about everything has changed except retailers own business practices. There is a new trend for some firms to share premises with the business dojo type places and others. Maybe retailers could share a big building together (smaller than a mall before some smart arse says it) or not be open every day of the week. One thing I've noticed is that people don't seem to mind slow overall shipping time if price is cheap, so maybe retailers need to can the five day 9-5 model....

[Woodman]

Well some interesting replies here. Seems not just the almighty dollar and the 15% margin of GST but service matters highly too.
Something else too, before the internet petrol was only 80ish cents a litre parking was just about free everywhere and you thought nothing off nipping into town to grab a specific item.
Since then you now have highly increased enforcement of rego and wof (I'm sure everyone gets caught out from tiem to tiem with schedules) that you cant risk shopping for that $50 part when you might get $400 fines picking it up.
Also since then our dollar has shifted hugely in value against the USA and other currencies.

So just about everything has changed except retailers own business practices. There is a new trend for some firms to share premises with the business dojo type places and others. Maybe retailers could share a big building together (smaller than a mall before some smart arse says it) or not be open every day of the week. One thing I've noticed is that people don't seem to mind slow overall shipping time if price is cheap, so maybe retailers need to can the five day 9-5 model....

Any retailer serious about selling shit is going to be open 7 days. Like they are now.