Buy from NZ? I tried but come on...

[steve_t]

So basically after all this nothing has been explained as to why we pay such exorbitant prices. Other than the old 'smaller market' argument, which in today's global marketplace doesn't hold water. One of two things needs to happen to encourage more spending locally, either the ability to import goods that are sold in NZ needs to be heavily restricted (not going to happen in this day and age) or the importers/etc need to address the discrepancy and balance things up.

Or they could just keep their heads in the sand, continue to shaft those that don't have the desire to look further afield (don't tell me that they are being loyal to NZ retailers, because at 3x the price there is no loyalty incentive from the retailers) and let those that are motivated enough send their orders overseas.

I'll state it again, I know it's not the retailers fault. But it is their responsibility. It's their responsibility to ensure their customer can get a fair deal, it's their responsibility to ensure more people spend with them, it's their responsibility to ensure their doors stay open. It's the way it is. It's not the customers responsibility.

Until such time though, more and more people are looking off shore to make their purchases and saving over 50% on buying locally. Either things change through pro-active means, or they change because their hand was forced...

OK, so how do you propose the individual retailer actively seeks to reduce their costs and thus be able to pass on savings to consumers?

[onearmedbandit]

OK, so how do you propose the individual retailer actively seeks to reduce their costs and thus be able to pass on savings to consumers?

Read what I have posted please. I have never stated that the retailers are charging too much because of their own operating costs. The issue appears to lie directly at the feet of the importers. Remember, the places I got my prices from in the States were retail stores as well, with physical locations, overheads, wages, etc etc etc.

So why do I lie the responsibility of it all at the retailers feet? Because they are the ones suffering. They are the ones laying off staff. They are the ones closing up doors. So, what should they do. Moan about buyers not being loyal until the bank forecloses them? Or be proactive about it and force their suppliers to address the situation. Because, ultimately, if the retailers in NZ go down so do the importers.

[steve_t]

Read what I have posted please. I have never stated that the retailers are charging too much because of their own operating costs. The issue appears to lie directly at the feet of the importers. Remember, the places I got my prices from in the States were retail stores as well, with physical locations, overheads, wages, etc etc etc.

So why do I lie the responsibility of it all at the retailers feet? Because they are the ones suffering. They are the ones laying off staff. They are the ones closing up doors. So, what should they do. Moan about buyers not being loyal until the bank forecloses them? Or be proactive about it and force their suppliers to address the situation. Because, ultimately, if the retailers in NZ go down so do the importers.

Sorry, what makes you think I didn't read what you wrote?
I'm not having a go. I was just genuinely asking how you propose a retailer proactively forces their supplier to address the situation. I can only think that perhaps John from XX Motorcycles could go to his supplier and say "Look, you need to reduce the cost of goods to me so I can reduce the cost to the customers, otherwise they'll just buy from the internet and I'll go out of business and you'll be supplying one less MC shop." I guess there's no harm in asking but I'm skeptical about how effective this approach would be. Any other suggestions?

Edit: Oh I see, you've read my "reduce costs" as reduce 'operating costs' where I was talking about 'costs of goods sold'

[onearmedbandit]

Sorry, what makes you think I didn't read what you wrote?
I'm not having a go. I was just genuinely asking how you propose a retailer proactively forces their supplier to address the situation. I can only think that perhaps John from XX Motorcycles could go to his supplier and say "Look, you need to reduce the cost of goods to me so I can reduce the cost to the customers, otherwise they'll just buy from the internet and I'll go out of business and you'll be supplying one less MC shop." I guess there's no harm in asking but I'm skeptical about how effective this approach would be. Any other suggestions?

Edit: Oh I see, you've read my "reduce costs" as reduce 'operating costs' where I was talking about 'costs of goods sold'

Yup, my bad, I misread what you meant. Yes I know the chances of it being effective are low, but what other choices do the retailers have available? The friend who I ordered the seat cowl for has stated to me, and in this thread as well, that he will not buy another new Honda from NZ. He paid roughly $24k for that bike, and he'll buy another new bike probably within a couple years. But it won't be a Honda. Well not from NZ anyway.

So no I don't have the magic silver bullet to answer the issue, all I could hope to see happen is that the ledger gets balanced better so that the retailers get better support from their suppliers (and to be honest, I'm mostly referring to OEM parts) so that they can get better support from their customers.

If the situation doesn't change, no dramas for me currently, I'll keep buying from overseas as many others do. But it'll be dramas for those that work in the industry. And I don't want to see these shops close down, I don't want to see these people out of jobs. But I'm not paying 3x the price to ensure that. I live in NZ too, and I get paid NZ wages. I can't afford to spend that much.

[p.dath]

I think there is going to be a market for offline and online retailers for quite some time to come, as they serve different purposes.

Offline retailers provide a place where you can walk in, discuss your needs, seek their input, perhaps look at a couple of different options, and of course that high touch service carries a cost.

When you purchase from an online source its kinda like buying wholesale. You probably already know what you want (you either have a part number, know how to use a fiche, or want something very specific), and more than likely, have the intention of fitting it yourself. Effectively you are buying wholesale.


And of course, you have to expect a price difference from a wholesaler and a retailer.

[wysper]

So does anyone on here actually work for an importer? Or is an importer?

I do, not in the motorcycle industry but in another industry.
There are many costs the end user doesn't see.
For instance,
minimum freight charges (might be one cubic metre or it might be 250kgs)
portage
port storage
insurance
taxes
duties
transport cost between wharf and shipping agent
transport cost from shipping agent to us
there is even a charge per line on invoice!!
and on and on

Many suppliers don't let you purchase one off items, or if they do they put a minimum charge on that. eg it might be $2,500 USD + freight + plus all your govenment taxes and import charges. We have one supplier that our minimum order is a 20ft container.

As an importer we have to project orders out 3 - 6 months in advance. This stock also needs to be paid for before it ships. We are crystal ball gazing. If we make a mistake we have dead stock. If we make a mistake we may not be able to supply a certain product for a long time.

We have had to reduce staff as times are really tough.

We carry the warranty, in most cases our suppliers charge us for "warranty" parts and we pay for labour for repairing goods. The consumer wants longer warranties and to pay less for the product.

We need a certain margin to even survive let alone make a profit and it is well above the 10% that keeps getting thrown around.

As has been said, we have less buying power, smaller numbers and a greater distance to move goods. We try as hard as we can to match US and AUS pricing, but we can't always do it. We are not creaming it.

I agree that the current retail model probably needs looking at. But any answers that mean lower prices for the consumer mean a loss of jobs in most industries as the supply chains get cut. There may not be room for importers/retailers in the supply chain, but the loss of one or the other while making the price lower for the consumer MAY make the consumer worse off in the long run.

[MSTRS:Me]

... Effectively you are buying wholesale.


And of course, you have to expect a price difference from a wholesaler and a retailer.

Huh? If you buy online from an American retail store, how do you figure that?

Locally, the importer/distributor effectively sets the price on an item for sale in NZ. They get the item/s from the manufacturer, who isn't going to sell them to anyone else. The manufacturer sells to a single distributor. Individual bike shops (eg) can't source outside the importer and are not going to get parts at prices significantly less than any other shop does. Yes, they could get together in an effort to force the importer to drop the wholesale price, but how likely is that? Esp when the importer knows that the shops are unable to effectively buy stock any other way.

[Robert Taylor]

I just imported some stuff from the states for my bike and a friends. While I made some decent savings on my stuff, it was the part I got for my friend that blew me away. Honda want to charge over $600 for the seat cover for a 2009 CBR1000RR. That's $600+ for a piece of plastic smaller than the cover of a magazine. Yes it comes painted and with decals. However I bought the same part for him from America for US$164 (NZ$210), add on shipping, customs and GST it still came out at being under half price.

Seriously. It's a fucking joke. I know it's not the dealers who set the price (thanks Blue Wing) but $600 for a fucking piece of plastic? After this experience (took less than 2wks to get here right on xmas time) I know I'll be looking overseas first. Sure I'll still look at NZ suppliers, but I won't be wasting any time if I find a similar situation to what I've just experienced.

So yes Robert Taylor and other staunch supporters of buying locally, I'd love to keep my money in NZ, keeping NZ'ers in jobs, keeping the NZ economy ticking along, but if it stays like this the only NZ companies I'll be supporting will be couriers.

Im certainly not in disagreement about the huge price disparities and there are many reasons both non justifiable and also justifiable. The day is rapidly approaching where there will be less middlemen clipping the ticket on the way through. According to a new NZ herald article 1.2 to 1.3 billion is spent online on goods by New Zealanders and at least 17% is spent overseas, primarily to US and Australian companies.
If gst was charged on EVERYTHING entering NZ the Government would accrue an extra 500 million in tax revenues, heck they sure need it. Also NZ customs are tightening up on invoice fraud i.e revaluing the goods at less than true cost, and the penalties will be severe. Those are positive moves towards a more level playing field.

[Robert Taylor]

Huh? If you buy online from an American retail store, how do you figure that?

Locally, the importer/distributor effectively sets the price on an item for sale in NZ. They get the item/s from the manufacturer, who isn't going to sell them to anyone else. Individual bike shops (eg) are not going to get parts at prices less than any other shop does. Yes, they could get together in an effort to force the importer to drop the wholesale price, but how likely is that? Esp when the importer knows that the shops are unable to effectively buy stock any other way.

The reality is that many wholeslaers have less margin in their products than dealers at suggested retail. It would be a misconception to think its a bed of roses!

[Robert Taylor]

So does anyone on here actually work for an importer? Or is an importer?

I do, not in the motorcycle industry but in another industry.
There are many costs the end user doesn't see.
For instance,
minimum freight charges (might be one cubic metre or it might be 250kgs)
portage
port storage
insurance
taxes
duties
transport cost between wharf and shipping agent
transport cost from shipping agent to us
there is even a charge per line on invoice!!
and on and on

Many suppliers don't let you purchase one off items, or if they do they put a minimum charge on that. eg it might be $2,500 USD + freight + plus all your govenment taxes and import charges. We have one supplier that our minimum order is a 20ft container.

As an importer we have to project orders out 3 - 6 months in advance. This stock also needs to be paid for before it ships. We are crystal ball gazing. If we make a mistake we have dead stock. If we make a mistake we may not be able to supply a certain product for a long time.

We have had to reduce staff as times are really tough.

We carry the warranty, in most cases our suppliers charge us for "warranty" parts and we pay for labour for repairing goods. The consumer wants longer warranties and to pay less for the product.

We need a certain margin to even survive let alone make a profit and it is well above the 10% that keeps getting thrown around.

As has been said, we have less buying power, smaller numbers and a greater distance to move goods. We try as hard as we can to match US and AUS pricing, but we can't always do it. We are not creaming it.

I agree that the current retail model probably needs looking at. But any answers that mean lower prices for the consumer mean a loss of jobs in most industries as the supply chains get cut. There may not be room for importers/retailers in the supply chain, but the loss of one or the other while making the price lower for the consumer MAY make the consumer worse off in the long run.

Very very well said!

[MSTRS:Me]

The reality is that many wholeslaers have less margin in their products than dealers at suggested retail. It would be a misconception to think its a bed of roses!

True. So it comes down to what the overseas suppliers charge for goods coming to NZ for eventual retail sale?
Otherwise, how can a US store sell an item for a third of the price a NZ retailer does?

[Robert Taylor]

True. So it comes down to what the overseas suppliers charge for goods coming to NZ for eventual retail sale?
Otherwise, how can a US store sell an item for a third of the price a NZ retailer does?

The reasons are manyfold and include much better buying power, very high stock turn and very low margins. Also our strong dollar against their relatively weak dollar distorts the situation somewhat. Also if you are not paying a whole raft of clearance and port fees plus gst on everything the price is not balooning further. Its complex if you are a distributor, much moreso than people realise.
Thats not justifying what is very unsatisfactory with a lot of pricing though.
The post by an importer that I agreed with states their realities very very well and its all too easy to unfairly malign importers for being bad greedy capitalists when like many they are struggling in an environment that is not healthy and also is not a level playing field for them. Quite the opposite.
Overseas internet sales are a reality and my business for one has adjusted to it, but my gripes are that everyone should be paying the same entry charges and gst and those who are fraudulently getting invoices underwritten should be nailed for it big time. Thats the direction the Government and NZ Customs is heading in and not before time. This will save a few jobs for ordinary kiwis, a reality that is kind of important.

[Smifffy]

It still doesn't explain why the local store couldn't order gear from the online store as a value added service to the customer and eliminate all of those charges, that at the end of the day do nobody any good.

[steve_t]

It still doesn't explain why the local store couldn't order gear from the online store as a value added service to the customer and eliminate all of those charges, that at the end of the day do nobody any good.

I'd say their contract with the importer would prevent them from doing this

[HungusMaximist]

So does anyone on here actually work for an importer? Or is an importer?

I do, not in the motorcycle industry but in another industry.
There are many costs the end user doesn't see.
For instance,
minimum freight charges (might be one cubic metre or it might be 250kgs)
portage
port storage
insurance
taxes
duties
transport cost between wharf and shipping agent
transport cost from shipping agent to us
there is even a charge per line on invoice!!
and on and on

Many suppliers don't let you purchase one off items, or if they do they put a minimum charge on that. eg it might be $2,500 USD + freight + plus all your govenment taxes and import charges. We have one supplier that our minimum order is a 20ft container.

As an importer we have to project orders out 3 - 6 months in advance. This stock also needs to be paid for before it ships. We are crystal ball gazing. If we make a mistake we have dead stock. If we make a mistake we may not be able to supply a certain product for a long time.

We have had to reduce staff as times are really tough.

We carry the warranty, in most cases our suppliers charge us for "warranty" parts and we pay for labour for repairing goods. The consumer wants longer warranties and to pay less for the product.

We need a certain margin to even survive let alone make a profit and it is well above the 10% that keeps getting thrown around.

As has been said, we have less buying power, smaller numbers and a greater distance to move goods. We try as hard as we can to match US and AUS pricing, but we can't always do it. We are not creaming it.

I agree that the current retail model probably needs looking at. But any answers that mean lower prices for the consumer mean a loss of jobs in most industries as the supply chains get cut. There may not be room for importers/retailers in the supply chain, but the loss of one or the other while making the price lower for the consumer MAY make the consumer worse off in the long run.

ausm.......