Ripped off in Oz

On my recent trip to the US it was fun that my previously measly Oz dollars bought nearly US$1.10. But another thing that illustrated was what a poor deal we get on many global goods and services. Before I went I investigated getting noise cancelling headphones. I didn’t want heavy things to carry so ended up with Sony earplugs – which I’d been told were not much good. I was right. Bose noise cancelling headphones perform really impressively but I didn’t want to carry an additional fat paperback sized parcel with me – and I didn’t want to pay AUD$500 for them (OK $495).

Likewise I swore that once Apple released a Macbook air that was small enough for me (11″) I’d buy it. But I couldn’t get it with 250 Gigs with all the Australian Apple salespeople telling me there wasn’t room on the unit for 250 Gigs like the 13″ unit. Well that wasn’t true in the US so I bought one there (I’ll post about my unsure journey from Windows back to Mac – I’m not so sure it’s better). And it was a good deal cheaper. And in the Mac store there were Bose noise cancelling earphones. The price US$299! They were the very same ones.

On my way home I rented a movie on Apple iTunes – Mao’s Last Dancer. It was US$3.99 but even though I was in LA, I’d signed in under my old apple ID and it wouldn’t rent me the movie. I offered it to me for AU$5.99! At least this is a product of Australia’s policy idiocy of helping global monopolists carve out Australia as a market to milk optimally (for them) by prohibiting parallel imports. Can anyone tell me if Bose can get the same kind of protection or whether it just uses its existing monopoly over its brand to enforce its pricing strategy. Anyway, there are oodles of these examples. I recently bought David Deutche’s The Beginning of Infinity from Amazon for $28 or thereabouts – including postage. The Australian price at the time was $49,99 though I saw it at Readings the other day for $44. That’s ridiculous (though bans on parallel imports are some part of the reason).

Anyway, this kind of stuff should be easy pickings for the populist media – and likewise for some enterprising politician or two. Moreover I would have thought that with quite a few of the firms involved, one might be able to influence their behaviour – they’re very protective of their brands. Not too sure how long they’d hold out against a decent campaign like this: “Dear Amar, What does Bose have against Australians?”  “Dear Tim, What do you and what did St Steve have against Australians?” Well who knows, but it’s worth a try.

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conrad
conrad
10 years ago

Yep, thank goodness for ebay. I also wonder whether the piracy of things like movies and music occurs more because people really do feel ripped off in Australia — especially given that not pirating things basically now relies on an honour system, and I doubt too many people would think of honouring a system where they feel cheated every time they use it. It’s also curious that for some things where there isn’t a monopoly, some importers still try to charge really high prices. This seems to happen with bike bits a fair bit, and the curious thing about it is that the importers not trying to rip off the public off seem to take the lions share of the market. For example, there are two mass produced brands which cost basically the same in most places on Earth I’ve been and you also seem them more or less the same number of times (Giant and Cannondale), but in Australia, the second of these brands is for no apparent reason much more expensive than the first. Now, at a guess, I think I see 20 Giants for each Cannondale here, so unless Cannondale are getting 20 times the margin, that’s just stupidity on the importers behalf.

Off topic, but I own a pair of the small Bose headphones (which I didn’t buy in Aus!). If you wear foam earplugs with them with nothing playing, it’s amazing how much plane buzz you can kill, so I reckon they’re worth the extra hassle. You can also listen to movies without the volume turned to 11.

conrad
conrad
10 years ago

ergh. Excuse the typos/grammar.

Dan
Dan
10 years ago

I could go *on and on* about musical instruments. As a drummer, I load up on drum gear when I’m in the US because it is *literally half the price*. And if you’re in the market for a seriously good jazz guitar, you may actually save money *literally going to the US* to buy it.

Music gear here is a massive gouge and scam.

meika
10 years ago

Shoes (not el cheapo shoes but bigger brand sport & work shoes) are about half price in Europe, as is coffee, but isn’t that a world commodity, why don’t we pay commodity prices here, bough 500grams of organic free trade coffee for less than 5Euro in Germany recently, no, not Aldi. Some second rank expensive convenience store. About $7 AUD at the time.

All bike related products currently get a premium in the market, so check out the same gear in related sports, like clothing, snow boarding windproof water proof gloves for my Tas winter bike commuting are much cheaper than the same deal for bikes.

I find wiggle.co.uk for all bike bits is good, and sports clothing, particularly neck to mid-thigh swimmers for my spouse, “triathlon wear” apparently, less than half price here. Also, they have the European price for brand name shoes, but they don’t sell Birkenstocks, of which the stock standard sandal is about $60 in Germany.

Yobbo
Yobbo
10 years ago

I think you’ll find that just about any product/service you can think of is cheaper in the US, apart from Health Care and University tuition.

Patrick
Patrick
10 years ago

It is amazing isn’t it? In some areas there are excuses – the length of the supply chain, absolutely moronic legislation, tariffs, high retail wages and astronomical retail rents.

Also the prices are narrowing – we recently bought a PlayStation 3, extra controller and two games, overall after shipping we saved about $100, which isn’t that much. A few years ago it would have been at least twice as much.

But overall, it is just staggering. As Dan noted you very quickly get to the point of offsetting the entire cost of the plane trip (you can do this with a suitcase of clothes in a day’s shopping). When you can realise economies of scale by flying yourself over those achievable to a global retailer you realise that there is something fundamentally wrong with it all and that all the excuses listed above just don’t wash.

john
john
10 years ago

Patrick

Have read that there is some sort of international agreement that means that Australia post actually subsidizes the delivery of international parcels of 2 kilos and under.

Patrick
Patrick
10 years ago

Not sure that would extend to DHL? I am even less sure how that would affect my point about flying there?

conrad
conrad
10 years ago

“I think you’ll find that just about any product/service you can think of is cheaper in the US, apart from Health Care and University tuition.”

Curiously enough, that even includes things made/dug up in Australia, like precious stones.

john
john
10 years ago

Its some sort of Swiss based convention that was reported in the SMH that means that 2 kilo and under international ( but not national) parcels are delivered at or below cost. I presume that this would distort the market a bit.

john
john
10 years ago

Sorry bad syntax
The SMH reported that some sort of international convention that we are signatories to, means that international ( not national) parcels 2 kilos and under, are delivered at or below cost. I presume that this would distort the market a bit.

The Worst of Perth
10 years ago

Bought some camera gear via US. It was on a truck in New York an hour after ordering on a Thursday, and in Perth late monday at my door on tuesday.

Last time decided to try aussie business. Was more expensive, but thought it might be even quicker and would deliver to work address. (US company only delivers to credt card holder’s address.)

The Australian company shipped it BY TRUCK from Queensland to Melbourne and then Perth taking nearly 2 weeks.

More expensive and slower. Never doing that again.

Sally
Sally
10 years ago

And Aldi is now pushing out Woolworths and IGA stores in the city and regions at the same time as offering higher wages. Why? It can buy its products cheaper?

meika
10 years ago

Because Aldi, being a private company, doesn’t leverage expansion in the same way?

Patrick
Patrick
10 years ago

Meika, I’m not sure what that is supposed to mean?

Sally, Aldi runs a very streamlined supply chain with oversight over the costs in each part. But a big part of the savings is reflected in the lack of choice – it is complementary to ‘majors’ not an alternative (for most people).

john
john
10 years ago

But the parcel boom is not all good news for Australia Post. Australia Post is also booking losses of $20 million a year on handling inbound parcels weighing less than 2 kilograms. This is because under payment arrangements set out by the Swiss-based Universal Postal Union, Australia Post gets paid the same amount for the processing of inbound international mail irrespective of the actual costs of delivery.

http://www.smh.com.au/national/post-unpacks-parcel-boom-but-its-a-mixed-bag-20110919-1khzh.html#ixzz1apQza5c5

a bit of cross subsidy ,no?

Sally
Sally
10 years ago

Patrick, Aldi is trying to expand in Australia but complains that zoning and other planning restrictions on the eastern seaboard are unfairly impacting on their projections and ability to compete with the big chains.

Aldi stores are replacing Woolworths stores on the exact same sites in some parts of suburban Sydney, or so I have observed and wondered why.

Perhaps it is because in these areas the Woolworths’ stores are struggling and are getting out leaving space for Aldi whose cheaper prices are more attractive to many customers who increasingly struggle with the price of their weekly grocery bill and have less concern with restrictions on excessive and unwanted brand and product diversity.

mozzie
mozzie
10 years ago

Well, of course if you *insist* on taking money away from that nice Mr Harvey, who only wants an added 10% GST on imports … .

It is extraodinary that our retailers are so clueless. I suspect that any AU book buyer with access to a computer uses Book Depository/Amazon. We regularly buy clothes, shoes, electronics and all sorts of equipment (scuba, kitchen, high end domestic appliances) from overseas. Not only are prices invariably 20-50% less, but the levels of service are generally superior.
Aldi is good for selected items, and Costco is usually worthwhile (so long as you cope with the vagaries of their product lines (there one week, gone the next) and the parking nightmare (Melb, anyway).

Pedro
Pedro
10 years ago

There would be plenty of the old woolies shops around that are too small for their preferred format and they would well be abandoned rather than upgraded.

I imagine that woolies have a better idea as to whether their number of product lines is excessive. Coles at least seems to be trying to shrink the number of lines and push people to their select products. Perhaps woolies is doing the same, but I haven’t noticed.

Yobbo
Yobbo
10 years ago

It is extraodinary that our retailers are so clueless

Our retailers aren’t clueless, but our government is.

I suspect that any AU book buyer with access to a computer uses Book Depository/Amazon.

Classic example of clueless government intervention.

http://www.theaustralian.com.au/news/arts/on-the-case-for-cheaper-books/story-e6frg8q6-1111118266177

mozzie
mozzie
10 years ago

Troll alert – level lilac. At level mauve, Godwin’s Law is visible at the horizon.