Why Aussies are Buying Overseas. Amazon Service

[csv8]

I ordered a Kindle from Amazon.com on August the 11th it arrived today, the 16th. Thats 5 days from ordering!!! It often takes me 5 to 10 days to get or send a parcel to Perth!!!! No wonder Aussies are buying online.!! Missus has had one for a year..no problems..books etc are much much cheaper than here.
Dick Smith will be Aussie Kindle seller from August 29..but you can only get Kindle in black , other colours are available..and its $50 more than the shipped price. Not sure if DSE Kindle will link to your Kindle account.
Retailers need to be competitive and stop blaming Aussies for buying overseas as cause of their problems.

[Cam]

I don't think it's just amazon.. i just bought car parts from the US totalling $130 delivered to OZ, to buy the parts locally would cost me about $600...

I am all for supporting Australian businesses, but my wallet doesn't allow for it..

[trippytaka]

Originally Posted by csv8

I ordered a Kindle from Amazon.com on August the 11th it arrived today, the 16th. Thats 5 days from ordering!!! It often takes me 5 to 10 days to get or send a parcel to Perth!!!! No wonder Aussies are buying online.!! Missus has had one for a year..no problems..books etc are much much cheaper than here.
Dick Smith will be Aussie Kindle seller from August 29..but you can only get Kindle in black , other colours are available..and its $50 more than the shipped price. Not sure if DSE Kindle will link to your Kindle account.
Retailers need to be competitive and stop blaming Aussies for buying overseas as cause of their problems.

All valid points... but there are a lot of things eating into Austrlian companies:
- Wages
- Massively high rent
- Low volume buying (20m vs 300m population) makes purchase price higher

[MAD]

Originally Posted by trippytaka

All valid points... but there are a lot of things eating into Austrlian companies:
- Wages
- Massively high rent
- Low volume buying (20m vs 300m population) makes purchase price higher

I dont agree with the last point.
Companies in Aus have the same access to the same goods from the US as we do. Sure they have to add 10% GST duty to any import over $1000, but they get the benefit of shipping cost reduction due to volume.
Some of the markups we see on retail prices reflect a whole lot more than the duty cost.
Car audio is a great example of some massive markups.

[trippytaka]

Originally Posted by MAD

I dont agree with the last point.
Companies in Aus have the same access to the same goods from the US as we do. Sure they have to add 10% GST duty to any import over $1000, but they get the benefit of shipping cost reduction due to volume.
Some of the markups we see on retail prices reflect a whole lot more than the duty cost.
Car audio is a great example of some massive markups.

When you are buying to sell 100,000 units you get a higher wholesale price to a business that is buying 1,000,000 units.

Then when you sell, you can put less margin on the product because you are going to be selling so many more units.

[MAD]

Originally Posted by trippytaka

When you are buying to sell 100,000 units you get a higher wholesale price to a business that is buying 1,000,000 units.

Then when you sell, you can put less margin on the product because you are going to be selling so many more units.

Buying as an individual you dont get to buy from a wholesaler.
You buy from a retailer that has already paid for shipping and applied their markup. And yet you still come out in front.

[trippytaka]

Originally Posted by MAD

Buying as an individual you dont get to buy from a wholesaler.
You buy from a retailer that has already paid for shipping and applied their markup. And yet you still come out in front.

Yes, but an Australian retail company will be selling much lower volumes than an American company.

When I have looked at making tees overseas the difference with volume is astounding. You're looking at 2-5x more expensive at the kind of volumes that an Australian retailer can move, compared to an American retailer.

[FgNewbie]

Originally Posted by MAD

Buying as an individual you dont get to buy from a wholesaler.
You buy from a retailer that has already paid for shipping and applied their markup. And yet you still come out in front.

Some retailers sell at wholesale prices.

One problem with Australian pricing for some products relates to when they were purchased and AUD value at the time.

In some circumstances the importer can't win. I know of one company that was effectively losing money when the dollar dropped because they didn't increase their prices. Now the dollar is stronger and the importer is balancing out his losses, people are screaming because he hasn't decreased his price.

There is a lot of stuff I'd like to comment on but the whole topic is a minefield.

[flappist]

Originally Posted by MAD

I dont agree with the last point.
Companies in Aus have the same access to the same goods from the US as we do. Sure they have to add 10% GST duty to any import over $1000, but they get the benefit of shipping cost reduction due to volume.
Some of the markups we see on retail prices reflect a whole lot more than the duty cost.
Car audio is a great example of some massive markups.

Australian companies must by law warrant themselves for up to 7 years whatever they import or build.

They also have to put up with lazy employees who take sickies on a regular basis, want 4 weeks a year holidays, want penalty rates on weekend or at night, want workers comp, want job protection, want immunity from stuffing up, want super etc. while having to pay tax to support for one of the largest percentage of non working benefit receivers/government employees in the world as well as all of the local government expenses.

Maybe you should actually go for a wander off to USA and see how the real world lives. Have you ever heard the term "minimum wage" mentioned on yank TV shows?

[MAD]

Originally Posted by flappist

Australian companies must by law warrant themselves for up to 7 years whatever they import or build.

They also have to put up with lazy employees who take sickies on a regular basis, want 4 weeks a year holidays, want penalty rates on weekend or at night, want workers comp, want job protection, want immunity from stuffing up, want super etc. while having to pay tax to support for one of the largest percentage of non working benefit receivers/government employees in the world as well as all of the local government expenses.

Maybe you should actually go for a wander off to USA and see how the real world lives. Have you ever heard the term "minimum wage" mentioned on yank TV shows?

You see how I said I didnt agree with the last point? That implies that I did agree with the others.

[flappist]

Originally Posted by MAD

You see how I said I didnt agree with the last point? That implies that I did agree with the others.

Did you read the first line about warranty?

[geckoGT]

Originally Posted by flappist

while having to pay tax to support for one of the largest percentage of non working government employees in the world as well .

I fixed it for you. By the way, what is wrong with that, we are worth it you know

[SB076]

Originally Posted by MAD

I dont agree with the last point.
Companies in Aus have the same access to the same goods from the US as we do. Sure they have to add 10% GST duty to any import over $1000, but they get the benefit of shipping cost reduction due to volume.
Some of the markups we see on retail prices reflect a whole lot more than the duty cost.
Car audio is a great example of some massive markups.

Put it this way, if you are an Australia retailer, you want to buy 5,000 widgets based on Australias pop and what you hope to sell. A US retailer is buying 100,000 widgets for the same reason but to support Americas population - The US retailer will get a better buying price and therefore can offer a better selling price

Granted some retailers have massive markups but not all - a lot of retailers are hurting at the moment

[cs123]

For a package to be delivered to Australia it will have to pass through the hands of Australian couriers too.

I would talk to your couriers for the Perth stuff. I had a packaged couriered from Perth that arrived the next day.

The online stores don't have the bricks and mortar store fronts to support and this must make a big dent in the cost. I'm not justifying the difference in price but it must be a factor.

[Road_Warrior]

But what do you do when a US online retailer won't ship to Australia?

[MAD]

Originally Posted by Road_Warrior

But what do you do when a US online retailer won't ship to Australia?

You find one that does.

or..

There is a service you can use that will essentially purchase the goods for you, in the US, then ship them to you.
Lots of people in Aus did this when Google first released the Nexus1 Android phone. They only sold it through google checkout and only to US residents.

[geckoGT]

Originally Posted by Road_Warrior

But what do you do when a US online retailer won't ship to Australia?

You don't buy it. Just like when the Australian retailer don't have what you want, you don't buy off them.

[Road_Warrior]

Originally Posted by geckoGT

You don't buy it. Just like when the Australian retailer don't have what you want, you don't buy off them.

What if its a unique product that you'd really like but the US seller won't deal with you because you're not in America? There has got to be a way around it.

[MAD]

Originally Posted by Road_Warrior

What if its a unique product that you'd really like but the US seller won't deal with you because you're not in America? There has got to be a way around it.

You can use a buying service.
I mentioned it above but you might have missed it in the large number of quick responses that occurred.

A couple I know of off the top of my head are www.priceusa.com.au and www.shipito.com
I have never used these services so it would be best to check out whirlpool.net.au for the best suggestions on which companies to use.

[Road_Warrior]

Originally Posted by MAD

You can use a buying service.
I mentioned it above but you might have missed it in the large number of quick responses that occurred.

A couple I know of off the top of my head are www.priceusa.com.au and www.shipito.com
I have never used these services so it would be best to check out whirlpool.net.au for the best suggestions on which companies to use.

Thanks MAD. I'd like to use sea freight because the item I have my eye on is heavy and I don't need it urgently. Air freight will work out to be too damn expensive - more than the item cost.

You guys who buy engine blocks and so forth from the US - how do you get these shipped here?

[aussie muscle]

Originally Posted by Road_Warrior

But what do you do when a US online retailer won't ship to Australia?

www.borderlinx.com

[TheSneakiness]

I recently ordered a K&N filter for my Paj and I couldn't get one here without ordering one in (so retailers RRP plus postage and no discount coupons allowed cause it's not in store)

I ordered from Summit and the cost of filter and shipping was about $110 which still worked out cheaper than going in store. Wait was about 3 weeks though which I was told from Summit and also gave me a tracking number for it too.

[MAD]

It could not possibly be cheaper for an individual to buy from a retailer than it would be to buy low volumes from a wholesaler.
If it was, maybe aussie businesses should buy from an overseas retailer instead.

[SteveJH]

Originally Posted by MAD

It could not possibly be cheaper for an individual to buy from a retailer than it would be to buy low volumes from a wholesaler.
If it was, maybe aussie businesses should buy from an overseas retailer instead.

I've heard of small business owners buying stock up from Big W etc when on sale because its cheaper then they could get it through the whole saler. That could just be talk though.....

[geckoGT]

Originally Posted by MAD

It could not possibly be cheaper for an individual to buy from a retailer than it would be to buy low volumes from a wholesaler.
If it was, maybe aussie businesses should buy from an overseas retailer instead.

Interesting thought.

Using a car part as an example, I was after an O2 sensor for a 2007 Mini Cooper S R56, which is interchangeable (because they have the same engine) with the Citroen C3 and a couple of Peugeot's. The cheapest price I could get from a retailer here was Repco which listed it as a special order, $600 plus $100 shipping and 6 weeks delivery time coming from europe. The parts dealerships ranged from $650 up to $700 (BMW). Yes people this is an O2 sensor that comes in a box that is about 10x5x5 cm.

I found the exact same part, correct part number out of the US through an online part retailer for $200 AUD and $70 delivery, part arrived within 7 days.

Repco could order the same part from the same place I did, put $100 markup on it and still deliver it to the customer $330 cheaper than what they originally quoted me. Not bad for a total of about 15 mins of work for them. Added to that the delivery time would be a lot shorter too.

[flappist]

Originally Posted by geckoGT

Interesting thought.

Using a car part as an example, I was after an O2 sensor for a 2007 Mini Cooper S R56, which is interchangeable (because they have the same engine) with the Citroen C3 and a couple of Peugeot's. The cheapest price I could get from a retailer here was Repco which listed it as a special order, $600 plus $100 shipping and 6 weeks delivery time coming from europe. The parts dealerships ranged from $650 up to $700 (BMW). Yes people this is an O2 sensor that comes in a box that is about 10x5x5 cm.

I found the exact same part, correct part number out of the US through an online part retailer for $200 AUD and $70 delivery, part arrived within 7 days.

Repco could order the same part from the same place I did, put $100 markup on it and still deliver it to the customer $330 cheaper than what they originally quoted me. Not bad for a total of about 15 mins of work for them. Added to that the delivery time would be a lot shorter too.

Yes but if the part fails two weeks later or does not fit REPCO have, by law, to wear that cost and hope they can recover it from their supplier and if they had fitted it would also have to cover the labour.

I went down the import track many years ago with computer bits and while it can be quite profitable will bite you on the bum in a BIG way when it all goes wrong.

[MAD]

Originally Posted by geckoGT

Interesting thought.

Using a car part as an example, I was after an O2 sensor for a 2007 Mini Cooper S R56, which is interchangeable (because they have the same engine) with the Citroen C3 and a couple of Peugeot's. The cheapest price I could get from a retailer here was Repco which listed it as a special order, $600 plus $100 shipping and 6 weeks delivery time coming from europe. The parts dealerships ranged from $650 up to $700 (BMW). Yes people this is an O2 sensor that comes in a box that is about 10x5x5 cm.

I found the exact same part, correct part number out of the US through an online part retailer for $200 AUD and $70 delivery, part arrived within 7 days.

Repco could order the same part from the same place I did, put $100 markup on it and still deliver it to the customer $330 cheaper than what they originally quoted me. Not bad for a total of about 15 mins of work for them. Added to that the delivery time would be a lot shorter too.

Exactly. And if by chance you get a bad one, but you chose a good supplier, you can fork out the dough to ship it back for a warranty replacment and still end up a long way in front.

[SB076]

Originally Posted by MAD

It could not possibly be cheaper for an individual to buy from a retailer than it would be to buy low volumes from a wholesaler.
If it was, maybe aussie businesses should buy from an overseas retailer instead.

Amazon and Dick Smith are both retailers (in the ops example) I am sure Amazon would have a better buying price than Dick Smith - hence what Trippy stated would be correct

[MAD]

Originally Posted by SB076

Amazon and Dick Smith are both retailers (in the ops example) I am sure Amazon would have a better buying price than Dick Smith - hence what Trippy stated would be correct

Yes, Amazon would have better buying power than DSE.
But DSE has better buying power than Joe Public.
DSE can buy from a wholesaler.
Joe Public has to buy from a retailer.

[SteveJH]

Originally Posted by MAD

Yes, Amazon would have better buying power than DSE.
But DSE has better buying power than Joe Public.
DSE can buy from a wholesaler.
Joe Public has to buy from a retailer.

Its not just buying power though. Amazon would have a single head office plus a few warehouses.

DSE has a head office, plus they have warehouses. However on top of that they also have retail outlets that need to be paid for (rent, wages, electricity etc), the retail outlet costs would be significant.

For example a 200m^2 shop @ $1,000m^2 pa is paying $200,000 just on rent. If they have 50% markup (which I doubt), that means they need to sell $300,000 just to cover rent. Then lets say they need to sell another $900,000 worth of stock to cover wages and electricity.

You are talking $1,200,000 in sales each year before you can even *think* about making a profit, and that doesnt take into account interest, marketing, account keeping fee's, refits, computers etc that still need to be added in.

Amazon wouldn't have any of these overhead costs, and the people they *do* employ @ the warehouse and head office, would be paid less then the equivilent position over here.