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

[MarkH]

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.

I'd certainly agree that not all importers are greedy and that many are very fair on their pricing. However some ARE greedy and charge a ridiculous price for the goods they import. There are items that I have bought in NZ cheaper than I could import them from the US. There are other items that I have bought from overseas that would still be under half the NZ price even if I got charged GST.

I understand the desire for a level playing field, but I have imported goods worth less than US$20 (with world wide free shipping) from overseas and there is no way that customs should bother stopping such a cheap item to charge GST on it. Obviously fraudulent invoices are illegal and if customs find any incoming package with a stated value that is clearly wrong then they can take appropriate action on that.

One thing that I am not willing to accept is that neither the importer nor retailer are overcharging when the goods cost over twice as much in NZ as the landed cost when buying from overseas. The TV example posted in this thread illustrates that goods can be sold at a competitive price and even 20% dearer in NZ than importing wouldn't be terrible. But 2x or 2.5x or 3x or above the overseas price just seems a bit excessive. When an importer brings goods in by the container the shipping costs are WAY lower than me bringing goods in by airmail so if it is still under half the cost to me to import the goods myself then someone somewhere is creaming it!

The biggest cost difference I can recall is where I paid 25% of the NZ price to get a new product from the US including air freight - had I paid GST it would have still been 3.5x as dear to buy locally. I wouldn't like to be a retailer buying from that NZ importer!

[Smifffy]

We saw an example of supply chain mathematics earlier in the thread. You need to turn over at least 3 grand an hour just to pay 5 people minimum wage before you even consider your other overheads.

So of course with the low volumes in NZ you need to set your prices accordingly.

[Robert Taylor]

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.

Its almost certain that their buy price would be the same as a private buyer. There would have to be a LOT of volume to justify any better price than essentially a one off or less orders than just a retail shop in the States. Also if you are a commercial operator you are a magnet for customs interest and therefore charges, thats part of the unlevel playing field that I keep eluding to

[Blackflagged]

Customs Clearance is one. No charge for private individuals, around $120 for businesses, on each package that attracts Gst..Work that out as a % on a $500 item.

Ps While i think of it. Anyone that can do cheap small package Customs clearance pls PM Me :-)

[Reckless]

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.

Rumor has it this was being done by a Auckland Ktm dealer? And I say its Hearsay but the dealership is no longer and I heard Ktm have tightened up the whole shebang! But its a sad day that the markups are so high their dealers find it better to buy retail from overseas?

Anyway enough of the nonfactual?
Everything I read here makes sense from one side or the other? I'd just like to point out its not up to the buying public to clean up your industry or be made to feel guilty because he is not loyal by having to pay twice the value for the same goods from NZ!
You can keep trying to create a captive market or fix what's here now. The retailers need to club together and protest the importers, the importers need to line up with them and protest the govt. From what I read here the whole thing needs a good shake up. Shops are closing and people are loosing their jobs there must be a better way, its up to you to find it.
But stop blaming Joe public for spending his hard earned cash as wisely as he can. Up to the point he feels ripped off, purchasers will always vote with their feet even if the shop gives damn good service. It just doesn't make sense to us, as 99% of the time we are buying retail overseas and its hard to believe that the local Honda or Kawasaki dealer in say California has such a huge turnover, lower rent and lower wages that he can sell for so much less at retail. Nobody is going to pay $1500 for a pipe they can get for $500 or $600 for a cowl they can get for under $300, end of story!

Let me also point out every-time we buy from overseas we are setting up relationships! I email my guy directly now, get pricing and a deal sorted out then use the pay thingy! They know me and I know and trust them. You just reply to the last email he sent you, it has all your purchases and dealings attached, even if your guy has gone, the next guy can see you are an existing customer. It becomes easy, actually easier than buying from NZ and I only do it 1-2 times a year? In business even in NZ we are often not meeting the people we deal with. If this is happening to everyone that buys offshore, bloody hell you guys have a tough road to ride to get your buying public back. The longer you leave it the worse it will get!!

IMHO its up to you guys to fix your own house not the poor sod who has to save for 3 months to buy overseas for his pipe rather than saving for 6 months to buy here!

I don't have the answer, I'm not close enough, you guys are the experts within your own industry. I do try and remain loyal and buy in NZ like most of us here.
I don't want to get into a scrap with anyone but that seems to be the feeling from a purchasers point of view??

[rwh]

We saw an example of supply chain mathematics earlier in the thread. You need to turn over at least 3 grand an hour just to pay 5 people minimum wage before you even consider your other overheads.

So of course with the low volumes in NZ you need to set your prices accordingly.

I saw that stated - I never saw the maths.

Richard

[imdying]

His seat cowl cost him $210 to land. I'm picking that if he had gone to local shop, and they said "No problem we can get you one in for $295 (more than 10%) we need 50% deposit and the rest on pick up. There's a warranty if it's defective, but if you decide you don't want it for any other reason there will be a charge to return it.

I'd say odds are pretty good he would hand over his credit card, you could order the gizmo online, he would get his part, you'd take a cut and everyone would be happy.

You are actually right on the money. I had the credit card in my hand, if he had of said $300 (I knew the $210 delivered price already) I would've paid my $90 premium and swiped it then and there.

I'm sure that the level of "premium I'll pay for being in the arse end of the world" is different for everybody, and some would've wanted to save the $90, and some would've paid another $150 for it. It does however seem unlikely that paying 3 times as much would drive away all but the upper most percentile of cusomters (who probably don't even ask how much, just when can I have it, and I'd put $100 on the yanks getting it to me before Blue Wing have even ordered it).

My assumption is that either:
- Blue Wing are rapists
- Honda Japan have no love for Blue Wing

Chances of finding out who is taking the big slice of pie, 0%.

[jasonu]

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.

Just curious. Assuming your item is being sold to retailers, how much more, in
%age, would I be paying for it compaired to the price if I went on line and got it from overseas myself?

[jasonu]

We saw an example of supply chain mathematics earlier in the thread. You need to turn over at least 3 grand an hour just to pay 5 people minimum wage before you even consider your other overheads.

So of course with the low volumes in NZ you need to set your prices accordingly.

These figures were later challenged and as far as I can see, the challenge was not disputed.

[onearmedbandit]

Another point of interest, had imdying purchased the cowl for $620, how much of that money would've stayed in NZ? By buying overseas we left more money in NZ I'd wager, to be spent locally.

[steve_t]

Another point of interest, had imdying purchased the cowl for $620, how much of that money would've stayed in NZ? By buying overseas we left more money in NZ I'd wager, to be spent locally.

I'd have imagined it would be approx the same amount leaving our shores

[monkey99]

the other thing is that if your particular brand or model is not supported by the distributor, you are fucked, pretty much. Very difficult getting parts for (say) a VFR400 NC30 or any classic SOHC Honda from the local dealer. The good news is there are specialists who can, and do, help.

Giz a DM with your info on Honda RVF VFR specialists... still trying to get educated people on to my bike (RVF NC35)

Cheers

[Mully Clown]

I'll do some research later but does anyone happen to know which bike manufacturers supply directly into NZ?

[wysper]

Just curious. Assuming your item is being sold to retailers, how much more, in
%age, would I be paying for it compaired to the price if I went on line and got it from overseas myself?

Thats really hard to say. We try to keep our retail prices in line with what it would cost you to buy the item at retail overseas and freight it into NZ. However, often it is not possible for us.

You have to keep in mind that the whole of NZ is smaller than many cities overseas. Economies of scale really do play a part, as much as people seem not to like to hear. Also NZ importers have next to zero clout with suppliers as we are so small a client to them. So it is all very well to say that we should get tough with our suppliers, but when you consider that a years worth of orders for us might constitute just a monthly order from other of there international clients. So if we complain about the cost of the goods, it is not like they would miss the sales. We might hold our own on a sales per capita basis, but it is a drop in the bucket to global sales.

There are many US companies or companies that their main market is the US that sell more to the US than to the rest of the world combined.

Just some thoughts.

[Ocean1]

We saw an example of supply chain mathematics earlier in the thread. You need to turn over at least 3 grand an hour just to pay 5 people minimum wage before you even consider your other overheads.

So of course with the low volumes in NZ you need to set your prices accordingly.

A very rough rule of thumb for engineering equipment with stock shelf life similar to bike parts used to be double the staff payroll to break even. Since then the cost of doing business in NZ has risen around 40%.

Edit: that's turnover, with margins of 60% for exclusive product and around 40% for everything else.


While we're all in bleat mode I'd just like to ask what people think the manufacturers prices might be? I'm tolerably sure the cost per unit would be a small fraction of the subsequent supply chain' s individual margins. And that for an entity with many, many times the overhead.

One thing always remains true: If a monopoly stands for any length of time then prices will rise well beyond any measure of true value.