[adr1an]

I'm pretty disappointed here - I thought it was the poms that did the whinging . We have it actually pretty damn good here. In fact - most retailers aren't at all gouging you and running around with 1000% markups like some would like to imply.

How about we make it pretty fair and simple, and compare apples and apples. Then lets see if we are getting the 'raw deal' so many want to imply. Heres the *basics* of running a hypothetical camera store in the US, vs in Australia.

Please, take the time to read through the post, and tell me at the end you still feel we are being 'ripped off' in this Country ?? I really think people aren't taking the real situation into account before launching into attacks on retailers... And if you go through just the *basics* - I;m surprised we don't pay three times as much in this country!

Lets, for the sake of discussion, use a very generous exchange rate of $AU1 - $US1... yes its higher, but parity would be about the 12mth average...

Rent. There is a world of difference. If we want to be a bricks and mortar though, its a cost of sale. Note:
"The biggest gaps in rental costs are to be found in the speciality retail sector, where Australian retailers pay rents about three times higher (and sometimes more) than similar US business."
Source: Australia's retail rents the highest in the world: Report

That was published less than a week ago!

So lets rent 25 sq m's. Its a shoebox, but we'll make it work.
"In the electronics category JB Hi-Fi pays US$512 per square compared, with US-based retailer Best Buy, which pays US$288 per square metres on average."

US: $7200
Australia: $12800

Already the poor aussie has to find an extra $5600 a year.. But we haven't even started...

Wages;
To run this store, we are going to need 2 full-time employees to operate 6 Days a week. And a minimum of two casuals to cover Late-night and Sickness.
Full timers get a 38hr Week, Casuals get the minimum 4 hrs a week... In the US though, I can just hire 3 guys, and make them work 45 hr weeks for the same rate...
New York Minimum Wage | New York Meal Breaks | Pay Days - but there is numerous to choose from)

US:
3 x $7.25/hr in New York - the highest end
$978/week
$50895/year....

Australia:
72 hrs @ $16.59/hr Full-Time (Max 38hrs)
8 Hrs @ $20.35 Casuals (Min 4hrs each).
$1260 Full Time + $162 Casuals
$65563 Full Time/year + $3256 during Annual Leave for a Casual + $7776 standard casual wages rest of year =
$74568/year

Payrol Tax and Compulsory Workers Insurances:
US ~ 20%
~$10,179

AU ~ 35%
~$26,098

So - Having just *rented* the store, and *employed* some people, we are currently about $40,000 BEHIND!!! Thats a LOT of K5's to sell! In fact, even if I got a sweet heart deal and grey imported them, I'm only clearing $300 a unit selling it at your RRP of $1100... So thats ~150 K5's right off the bat I need to sell just to CATCH UP! (which it isn't really - because for every sale, I still have a "Cost of Sale" of around $50... so its really about 200 units to 'catch up'.

Now I haven't even scratched the surface, and covered off the further 12% superannuation the aussie needs to find, or the public indemnity insurances a shop front needs. We haven't paid our higher Utilities or Comms cost yet. And I - as store owner - obviously have to eat and pay a mortgage too - so theres another $40,000 a year.... or 250 K5's... Then theres the bookkeeper I need to do my books - I can't possibly work in the store and stay on top of a BAS in a busy retail environment - its just asking for trouble. I also need the quarterly float to pay my GST.. so theres another cost of sale to stay on top of....

So already, I need to sell around 400 K5's just to 'compete' with the US guy on 'costs'... And we still haven't really ordered or sold a single product yet!!

One store - 400 K5's - that'd be almost the annual units in all off Oz wouldn't it ? And they haven't made a single cent 'profit' yet!!

Please everyone - I don't disagree we pay more in this country. BUT.. Those higher prices aren't going into the retailers pocket. They are paying our, in some cases, THREE TIMES HIGHER SALARY! They are paying for our protected workers rights, such as Sick Leave and 4 Weeks Annual Leave ! It pays for Parental Leave! Sure we could deliver a lower price to customers I'm sure - if we paid workers $7.50/hr, didn't afford them Superannuation, Didn't provide sick leave (don't show up, don't get paid), forgot about annual leave, parental leave or any other benefit every Australian Worker gets.

So whilst we all beat our chest about "The global economy" - Until we also talk about "Global Workers Rights and Benefits" - you cannot *expect* to pay the same price for a good in every corner of the globe.

We of course can vote to spend our consumer dollars wherever we want - but its a double edged sword - The more retailers that go out of business because no one wants to pay their 'high prices' (which as shown above - isn't really the retailers fault alone) - the higher our unemployment, etc etc.

It costs money to "live the good life" - it doesn't come free or cheap... unfortunately.... Please consider the above next time before declaring all Australian Retailers rip-off merchants.
Or alternatively - Start pressuring your local member to remove all workers rights and minimum wage protections - that should drive down the prices in relatively short order!

(ps... I don't work in retail, or run retail... but I do consider that we have some of the best workers rights in the world and I also don't expect to work myself for nothing, and thus, don't consider someone else making a living a bad thing either..... sure I want to pay as little as the next bloke - But I also want our economy to continue to exist and our workers protections to remain... I acknowledge that those things come at a price and I am concerned at the number of people that completely ignore these differences when they launch into their 'anti-australian retail' arguments... )

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Last edited by adr1an; 07-06-2011 at 02:42 AM.

[NicoleAu]

I understand what you're saying Adr1an, but when you compare apples to apples there can be price disparities here of hundreds of dollars between B&M stores. As a family on one income, we can't afford to pay out hundreds more, just because an Australian business has imported it. In reality to be competitive these stores should not have such a large difference. The Australian retailer will have to look into moving more of their operations into online businesses. It's a viable business model and as time goes on, more and more people will choose to shop online rather than go out. Our society is becoming more and more 'cocooned' as time marches on and technology improves. I think eventually the middle man will be cut out, or down at least.

[Pixley]

Globalisation has been with us for close on 30 years Adrian. We floated the dollar, got rid of some trade barriers and decided to compete on the world stage. Either we buy that argument as being good for Aus or we don't - ie we need to be competitive doing what we do best or we put up all those barriers again and go back into our protectionist box. Your argument is saying we as the customer need to only buy half the argument - the argument that is good for the retailers. Retailers can't have their cake and eat it too.

[adr1an]

Globalisation has been with us for close on 30 years Adrian. We floated the dollar, got rid of some trade barriers and decided to compete on the world stage. Either we buy that argument as being good for Aus or we don't - ie we need to be competitive doing what we do best or we put up all those barriers again and go back into our protectionist box. Your argument is saying we as the customer need to only buy half the argument - the argument that is good for the retailers. Retailers can't have their cake and eat it too.

Refering to the above I posted, I believe the shoes a bit on the other foot. We all want our minimum wages, our superannuation, and our Land Values (which sets our rents), our Parental Leave... and our qtr. acre block

As I demonstrated - in this country - before you sell a single unit - you are $44,000 behind...

How is that the retailer having their cake and eating it too ? As I said - Strip our ridiculously higher salaries and corporate taxes out... and all of a sudden, the retailer could actually compete.

Right now - Everyone here seems to expect them to just run at a loss - Or that by having a purely online store (and obviously no staff) they could offer a cheaper product ? I guess the goods will pack and send themselves ? And they store them in their garage's ?

I mean - Please - Someone explain using the costs I outlined above *how* it can *possibly* be cheaper to deliver goods via retail in this country ?

We all point and quote 'globalisation' - lets 'globalise' our workers rights then too, and our corporate taxes.. Ooops... Don't hear anyone suggesting that too much do you ?

[Pixley]

My point is Adrian - in any other field a product "has" to be competitive - and we have seen many, many non competitive industries close and move off shore. But it is almost a case currently in retail that we have to "take pity" on the poor retailer and pay up to $400 more for a camera to buy it with an Aus warranty in Australia. Is the Aus warranty worth that much? Why not do what we do well and accept that we can't do other things as cheaply - or adopt a different business model? We are already seeing a changing landscape in the book retail sector - we might just see it change in other areas too.

[adr1an]

Retail employs 15% of australian employees.

Want to off-shore that and have them on the unemployment list

[twitch]

K-5 is $1,530 for local stock (which less GST is below $1,400), not $1,700. Let's compare apples to apples (best Oz price with best grey).

[Pixley]

Retail employs 15% of australian employees. Want to off-shore that and have them on the unemployment list

I think that of course over the coming years we will see a changing lanscape in the retail sector - just as industrialisation and mechanisation and the indtroduction of computers etc etc saw a changing landscape for workers during the past 200 years. Of course in this scenario people will lose jobs - but other jobs will be created and other opportunities in selling to people in a different way will emerge. My point is that retailers are struggling now with the current realities. They will need to adapt or innovate or even perhaps specialise. The price point for the local and o/s goods is too great for people who are web savvy to ignore and this issue wont magically go away for them.

[Pixley]

K-5 is $1,530 for local stock (which less GST is below $1,400), not $1,700. Let's compare apples to apples (best Oz price with best grey).

Wish I could get my local retailer to match this price - alas no - not even close :ugh:

[twitch]

Wish I could get my local retailer to match this price - alas no - not even close :ugh:

Really? You are in Melbourne and that price is from a B&M in Melbourne.

[Pixley]

I can go to DCW and get close to that price ($1569ish I think) - don't know quite where I can get it for $1530 - but my local camera store (where I go to print photos and buy accessories etc) wont match it. And despite my theoretical argument above - I would still like to buy local.

[Tommot1965]

I'm pretty disappointed here - I thought it was the poms that did the whinging .

EH...I resemble that remark.....LMAO

[Osama Binhidin]

Refering to the above I posted, I believe the shoes a bit on the other foot. We all want our minimum wages, our superannuation, and our Land Values (which sets our rents), our Parental Leave... and our qtr. acre block

As I demonstrated - in this country - before you sell a single unit - you are $44,000 behind...

How is that the retailer having their cake and eating it too ? As I said - Strip our ridiculously higher salaries and corporate taxes out... and all of a sudden, the retailer could actually compete.

Right now - Everyone here seems to expect them to just run at a loss - Or that by having a purely online store (and obviously no staff) they could offer a cheaper product ? I guess the goods will pack and send themselves ? And they store them in their garage's ?

I mean - Please - Someone explain using the costs I outlined above *how* it can *possibly* be cheaper to deliver goods via retail in this country ?

We all point and quote 'globalisation' - lets 'globalise' our workers rights then too, and our corporate taxes.. Ooops... Don't hear anyone suggesting that too much do you ?

So what do you do for a living I have worked for myself all my life and yes there is price gouging here. Example rode stereo mic made here in Australia can be bought cheaper from the states, or England and yes that does include postage. So tell me how that can be?

[wwwmorrell]

Sounds like, talks like, a Canberra public servant to me, been on the public gravy train for to long.

No offence intended, but real life is a little different for the rest of us.

So what do you do for a living I have worked for myself all my life and yes there is price gouging here. Example rode stereo mic made here in Australia can be bought cheaper from the states, or England and yes that does include postage. So tell me how that can be?

[adr1an]

Sounds like, talks like, a Canberra public servant to me, been on the public gravy train for to long.

No offence intended, but real life is a little different for the rest of us.

LOL.. Good thing non taken - Wrong by the way - by a long shot. I mean, besides being a complete straw man argument - don't you think it'd be rude if I said as the basis to dismiss all your statements without any genuine regard as "Sounds Like, talks like, a Mt Buller Bumpkin.. been on rural welfare too long" (By the way - if you want to talk about price gouging.... lol.... )

Now.. back to the facts I actually raised - Real Life by the way - rather than a hollow argument wrongly based on assumptions about my employment - care to elaborate on how exactly using the numbers I outlined above - you propose that your average retailer is screwing you ? How can simply uttering the words "Oh, he just needs to go online" fix any of the issues I highlighted ? What - do people think he suddenly has no staff ? Do you think commercial internet sites to handle a proper volume come free ? No transaction fees anymore ? Rent is about 1/4 of where the excessive cost blows out - and that's the only thing you'd save in online - unless we just want to convert the entire retail sector to unemployed.. oh yeah - get them different jobs - in what sector do you suggest ?? ...Or they stay employed as handlers and pickers... and cost just as much if not more than retail employees... hows that lowering costs ?

'Real Life' means that if you want high salaries combined with a high cost of infrastructure - you are going to pay higher prices. That's reality. Or do you honestly think you somehow should get 3 times the level of salary that someone in the US does, but pay the same price they do ? Hows that 'real life'???

Also - feel free to quote specifics about various instances of where it happens but it does nothing to prove a point - I never said every Australian Business is ethical - rather what I said is that every retailer is not out to rip you off which is the general sweeping argument everyone wants to mount. So don't consider quoting a bunch of products that have disparity as argument for how in light of the costs I outlined we are being ripped off. No one said stores dont charge differently - and guess what - different stores have different rent and costs too - but I guess we could not get bogged down with the facts...

No one said every store sells at cost and that some don't make better margins than others - but this mass assumption that every business in Australia is trying to gouge you is just false and entirely failing to see the cause of the problem... there is genuine reasons that we pay more and no one here so far has demonstrated otherwise...

Finally:

I have worked for myself all my life and yes there is price gouging here.

Are you saying you openly gouge your customers and thus know this through first-hand knowledge??
Or are you trying to argue because of a specific example which does nothing to refute the points I raised (Who knows - maybe that manufacturer is a theifing scumbag) that therefore *all* Australian Retailers are Rip-Off Merchants ? Or do you examine the books of every business you have dealt with and seen their costs of sale and other accounting info in order to determine they are ripping you off and profiteering ?

Work out how - given the costs I outlined - you for see us all being ripped off blindly. That includes showing how this magical switch to 'online' works. Ending up with 15% extra unemployed sounds to me like it might drive inflation up a little, so hardly seems like a solution to just off-shore the lot not to mention it takes non of the actual costs of being online or operating a business with staff into account...

Actually stop and think and explain the solution... please... ideally with some numbers to back your statements as I did...

Just as an aside - in this grand world of 'online' retail that will solve all our problems - what are peoples solutions for when its midday Saturday, and you've just broken a Lens, and need one then and there ? eBay may be grand and all - but it wont get you one inside of Tuesday unless the gods are truly smiling.... Or again - is that a price we are all prepared to pay to achieve this fantasy of paying the same price in every corner of the globe ?