Why don't we pay GST on imported stuff?

[98tls]

Yeah, I know. But I figure the retailer has to pay the same as I do, then add his markup and GST. Also I do like to support the small local guy as he's the one who has to maintain a workshop to change my tyres etc.

I hear what your saying and after spending years selling both bikes and cars have an understanding of the costs associated ie the bigger picture.Does get out of hand though eh,theres been plenty of times over the years ive come across nothing short of robbery when dealing with some retailers but the worst was 2 aftermarket rims/2 supersprox sprockets and 1 high end chain inclusive of post from America delivered to my doorstep for NZ $3000,cost of the same rims only here $4500 plus post,whatcha think i did.

[98tls]

US price for small ignition part? - $86

NZ price for exactly same part? -$300

How much did you pay for a lap dance T?

[Jantar]

But the retailer is almost certainly paying a lot more to the local importer/wholesaler than you're paying an Ebay trader from the U.S. In turn, the local importer is likely paying more than the Ebay trader due to economies of scale and because he's importing in bulk he's paying duties & GST each & every shipment.

I am buying off ebay from a retailer, he in turn has to buy from a wholesaler, so it must be the importer who is adding on such large margins.

Another example which I currently looking at. The lights on my bike are not up to standard, and I'm looking at fitting a set of Hella FF40s. Hella NZ do not list this particular light so when I enquired with my local retailer, he intially said that there was no such item. I showed him on the net that the FF40 does exist so he rang Hella NZ to enquire. They called him back and said that they could import them as a one off at $249 each. They are available retail in USA at US$150 for the pair.

[Edbear]

As the NZ sole agent I have minimum order quantities to meet and pay in USD so I am susceptible to fluctuations in the exchange rate and that can make a significant difference at the volumes I import.

Upon pick up by the freight company I am notified the GST and duties to pay immediately on the NZD value. At GST time I claim the GST amount back against sales but meantime I have had to carry the cost of the goods which I pay with my order plus the GST for up to two months or more.

I have deliberately held the NZ RRP as close as possible to the USD equivalent to avoid criticisms of profiteering but that means my margin to my dealers is lower than ideal. Fortunately my overheads are low and I do not have to pay for a warehouse, shop or staff but if the exchange rate drops I will have to increase prices.

So if anyone checks the US price be assured I simply cannot afford to be any cheaper.

[Madness]

I am buying off ebay from a retailer, he in turn has to buy from a wholesaler, so it must be the importer who is adding on such large margins.

The U.S based Ebay retailer is also likely buying 2, 3 or 4 times as much volume from the manufacturer and is likely getting a much better price for that reason. I recently worked for a U.S based manufacturer of industrial tools here in N.Z, selling to local retail outlets. As the importer we were making up to 80% GP on some lines that the retailer would in turn make between 30-40% GP. The 80% margin sounds unreasonable but once again, economy of scale - any less and they'd struggle to pay the bills with the turnover involved.

The world has changed and N.Z is none the better for it IMHO.

[tigertim20]

well that didnt take long, less than a page to make another why is shit in NZ so expensive.
Ill summarise the last 50 threads like this for you.

its the price of living in paradise. get over it.

[Jantar]

...The 80% margin sounds unreasonable but once again, economy of scale - any less and they'd struggle to pay the bills with the turnover involved.....

80% margin IS unreasonable. So unreasonable that your potential customers will bypass you and import directly. Now you lose even the small turnover you should have had, and so does the retailer.

[nzspokes]

80% margin IS unreasonable. So unreasonable that your potential customers will bypass you and import directly. Now you lose even the small turnover you should have had, and so does the retailer.

LOL, How many wholesalers are on a 80% margin? I dont think most people understand margins.

[98tls]

The U.S based Ebay retailer is also likely buying 2, 3 or 4 times as much volume from the manufacturer and is likely getting a much better price for that reason. I recently worked for a U.S based manufacturer of industrial tools here in N.Z, selling to local retail outlets. As the importer we were making up to 80% GP on some lines that the retailer would in turn make between 30-40% GP. The 80% margin sounds unreasonable but once again, economy of scale - any less and they'd struggle to pay the bills with the turnover involved.

The world has changed and N.Z is none the better for it IMHO.

Not so sure mate,retailers at times tend to take the piss,live in small town NZ and you see it every day,at work i listen to the local radio station,many of the ads on it have the "support your town/retailers etc etc" which is all good but falls down when you to compare prices ring someone in the big smoke who has a choking fit when you tell him what you were quoted locally,not uncommon to take a trip buy the same product stay in a motel have a night out and still come home better off.:wacko,case in point awhile back her indoors wanted a new washing line fair call i thought so shot down to placemakers $550 next time i went up to Christchurch i bought the exact same thing for $250.Why the huge difference?Doesnt cost $300 to freight a washing line 250 kms.

[Robert Taylor]

As the NZ sole agent I have minimum order quantities to meet and pay in USD so I am susceptible to fluctuations in the exchange rate and that can make a significant difference at the volumes I import.

Upon pick up by the freight company I am notified the GST and duties to pay immediately on the NZD value. At GST time I claim the GST amount back against sales but meantime I have had to carry the cost of the goods which I pay with my order plus the GST for up to two months or more.

I have deliberately held the NZ RRP as close as possible to the USD equivalent to avoid criticisms of profiteering but that means my margin to my dealers is lower than ideal. Fortunately my overheads are low and I do not have to pay for a warehouse, shop or staff but if the exchange rate drops I will have to increase prices.

So if anyone checks the US price be assured I simply cannot afford to be any cheaper.

Yes we are pretty much in the same boat, except we also provide a high level of backup for a product that needs to be set up for local conditions. Thats a hell of an investment in equipment and ongoing training at the factory in Stockholm. Fortunately we do not purchase in $US, we purchase in Swedish krona and that currency is a whole load more stable than North Mexico dollars.

Just yesterday we had a bloke in that purchased an Ohlins shock from offshore, he was pretty cagey about it all but nonetheless he was a new customer and treated as per anyone else, a job at a fair price and done properly. He might have made a small saving on purchase price, less than $100 or so. But the shock was oversprung for him and overvalved for our roading conditions. ( We had already identified with road and dyno testing ) Slightly short of $350 later he has a shock that is set up to work well on our roads, as it should have been excepting the resellers overseas have no conception of our market, nor do they care. They will just happily take our money and put it back into THEIR economy

So the guy is out of pocket compared to if he had purchased off us, but further to that if we had sold him the shock it would have automatically been set for him. But further again if he wasnt satisfied we would have changed the setting further at no extra cost.

There seem to be a level of people on this site that tar all business people in NZ with the same brush. NZ business employs people, let that not be forgotten.

[98tls]

There seem to be a level of people on this site that tar all business people in NZ with the same brush. NZ business employs people, let that not be forgotten.

To be fair RT in your defense of local business you tend to generalise yourself,theres plenty of them out there taking the piss.

[Edbear]

Yes we are pretty much in the same boat, except we also provide a high level of backup for a product that needs to be set up for local conditions. Thats a hell of an investment in equipment and ongoing training at the factory in Stockholm. Fortunately we do not purchase in $US, we purchase in Swedish krona and that currency is a whole load more stable than North Mexico dollars.

Just yesterday we had a bloke in that purchased an Ohlins shock from offshore, he was pretty cagey about it all but nonetheless he was a new customer and treated as per anyone else, a job at a fair price and done properly. He might have made a small saving on purchase price, less than $100 or so. But the shock was oversprung for him and overvalved for our roading conditions. ( We had already identified with road and dyno testing ) Slightly short of $350 later he has a shock that is set up to work well on our roads, as it should have been excepting the resellers overseas have no conception of our market, nor do they care. They will just happily take our money and put it back into THEIR economy

So the guy is out of pocket compared to if he had purchased off us, but further to that if we had sold him the shock it would have automatically been set for him. But further again if he wasnt satisfied we would have changed the setting further at no extra cost.

There seem to be a level of people on this site that tar all business people in NZ with the same brush. NZ business employs people, let that not be forgotten.

I need an office lady who knows MYOB and can keep a track of everything more efficiently but no way can I afford a wage even for myself at present. It will be at least a year before I can think of employing someone.

I am investing everything I can scape together to build stocks and living off my wife's wages and the rent from our flat while taking as little as I can in drawings. I am on target to triple last year's turnover if nothing improves further but realistically I am aiming to quadruple last year!

So far I have 37 dealers in NZ with calls every week from others wanting in. I am aiming for 100 by the end of the year if current restructuring goes well. Up to now I have had the handbrake hard on to try and limit the speed of growth but it's a losing battle...

[Madness]

80% margin IS unreasonable. So unreasonable that your potential customers will bypass you and import directly. Now you lose even the small turnover you should have had, and so does the retailer.

At that 80% GP we were actually undercutting 3-4 competitors in the same product segment. It's also very unlikely that any of the customers of my former employer would ever import this product range directly simply due to the nature of the product (lots of different sizes & relatively small turnover at store level).

case in point awhile back her indoors wanted a new washing line fair call i thought so shot down to placemakers $550 next time i went up to Christchurch i bought the exact same thing for $250.Why the huge difference?Doesnt cost $300 to freight a washing line 250 kms.

I bet you didn't get the washing line for $250 at Placies in Chch - Placies are a pack of thieving cunts with their sticker prices.

[Edbear]

To be fair RT in your defense of local business you tend to generalise yourself,theres plenty of them out there taking the piss.

You do wonder at times! If I do triple or quadruple turnover I will be in a strong position and making money so it is an exciting business to be involved in. Everything else is doing better this year as well though it is the batteries leading the charge for sure. Best investment I could have made!

[Scuba_Steve]

See I'm happy to buy from NZ if it's a reasonable price, but when I'm able to get a OEM part from Honda or Suzuki in the US at retail including overpriced shipping to my door at less than half NZD of what the local Honda or Suzuki are willing to give it to me for... yea someones taking the piss...

Paintball gear however I get from NZ, the price difference between US (after shipping etc) & NZ is usually so little (if any) you just don't bother looking offshore unless NZ shops don't/can't supply the item you want