26th Feb 2012, 05:10 PM #16
You are right about the service, I remember the guy was angry with me when I told him to cancel the order that I'd waited months for.... I didn't tell him I got it on-line, or that I knew the real reason he couldn't supply what I'd ordered, I just never went back.
I'm willing to bet he would be amongst the first to complain about on-line sales ruining his business..
There are plenty of times I would prefer to buy locally because of the personal contact, and good advice and I'm mostly happy to pay extra for the service. Especially if they stock what I'm after... But there are limits...
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26th Feb 2012, 05:47 PM #17
Agreed Ray, I'd always prefer to support locals in everything if I can, but by the same token I'm not a charity. I was looking to replace a bicycle frame recently, it's an expensive bike. The local guy wanted me to order it, wait until his order went to France every 6 months, then wait again while he had them shipped out by sea freight. Then if there was any warranty I had to send it back to France to be repaired. The local guy carries absolutely no stock here at all. The alternative was for me to buy it from a UK dealer, have it flown out to arrive within a week of my order, no difference in warranty, only I got to save $1500! So what precisely was the local guy doing for the $1500 difference, PLUS the usual retailer markup? I really wonder what planet these guys are from!
26th Feb 2012, 06:32 PM #18
There is a philosophy permeating through Australian retail/wholesale of the customer will pay the price, no matter what that is if he or she wants the item. As recently late last year I was speaking to a well known retailer and he expressed this attitude to me and seemed oblivious to the buying that is now occurring from other markets. I had someone ring me re a cyclone purchase and actually ask if he could buy it OS cheaper than I could supply it, I thought that a bit cheeky! In fact it would cost him more to import it and I told him so but I don't think he believed me.CHRIS
26th Feb 2012, 09:50 PM #19
Retailers will adapt to the changing market as we consumers become more literate in our purchases - either that or close up......as an aside, I purchased some tools direct from the US last week - the local Australian Importer/retailer told me that he could order them for me but there would be a 1-2 month delay at best owing to postal service delays both in the US and here in Oz - he couldn't guarantee a delivery time so suggested I try direct - all up they would have fitted in a beer box slab and weighed about 10 lbs.....not a big order by any means so I contacted the US supplier who said would he sell them to me and arrange delivery, I ordered them online, paid via cc and the goods were delivered to my door 4 days later via the friendly FedEx van.....that's from Tennessee US to rural Victoria......the freight charge was about the same whether I chose USPS or FedEx - guess I picked the right one as normally they take 10-15 days via post............it does make you wonder how the retailers in Oz are going to try and compete with service like that......it'll be a challenge.....Lee
27th Feb 2012, 01:29 AM #20
My wife's car needs a new valve cover gasket...typical for the make at 100k. Local dealer: $240 plus 2 hours labour at $115. Same make dealer ex California $38.95 shipped, install myself in three hours for free. $470 for a new gasket? As if.
Bought a diagnostics code reader (automotive) for $59 delivered this week. The same thing here is $125 delivered. How come even the local ebay sellers reckom that they can buy a common ebay item and try to double the price while selling it on...ebay?
A mate recently installed a new Gaggenau cooktop in his kitchen reno. Here they cost about $7000. He had it delivered FedEx from California for about $1200 all up. The internet is rife withh stories of people saving $35,000 actial dollars on container loads of kitchen appliances and living room furniture over the local prices. Including the container freight and all of the local wharf rip-off charges.
Having negotiated the recent surface plate buy I am more willing to do other things in the future. There is no way that something should go from China to the US, be purchased at retail, get road freighted many 100's of miles, get container shipped here for 1/2 the local price.
Just now, while I couldn't sleep I bought a new pair of uniform shoes from copshoes.com for 40% of the local price. Beats me why this happens. The industry in which I toil is an international one. Local customers are free to choose whoever they want based on price only, if at suits. I insist on having the same freedoms, especially when the local sales guys offer no stock and no service.It's all part of the service here at The House of Pain™
Flight Rust TM Never Sleeps
27th Feb 2012, 07:37 AM #21
I wrote to the Ebay guy telling him what I thought of his business model and where I could get the same thing for less. He did reply but I didn't bother reading it. What, realistically, could he say that I'd be interested in reading?
Retailers are going to have to offer prices within 20% (less for big ticket stuff) of best international price or go out of business. If that means flattening the sales chain to cut out importers & distributors, so sad, too bad, with modern IT their time may have passed as part of a viable business model. Not like they often carry stock or provide willing warranty support anyway, as numerous people have pointed out.
27th Feb 2012, 09:40 AM #22
It is cheaper to buy tyres from the US by a long way which is something that may not occur to people. I can buy certain things from NZ cheaper than I can here due to our dollar advantage.CHRIS
27th Feb 2012, 11:00 AM #23
Where one door closes another door opens. Maybe the retailers could reinvent themselves as niche importers, bringing in containers packed with individual people's direct imports? From what I've seen there's definitely a BIG market there for some enterprising individual who doesn't fall into the "I want it all right now" trap.
In my mind therein lies the truth. We have a culture of wanting all or nothing. How many times have I heard "Well it's got to be worth my while ...", true enough, but not when the person's time is worth about $12.50 an hour and not the several hundred he just quoted to do the job! The other day I was about to go to work when I found one of the sewer drains was potentially blocked. Not wanting to take a chance of it turning pear shaped while I was away I called a plumbing company who had left a magnet in our letterbox, all in all a good opportunity to establish a relationship with a plumber for my wife to trust and call upon when I'm away. This wasn't an "emergency job" or some weird hours. It's a 20 minute job to run the water blaster down to the boundary trap, 10 minutes to do the paperwork, and say 30 minutes travel time. I give the guy a hand to do it (a good thing as if I wan't there he would have flooded my workshop due faulty equipment). The total cost, 2 hours labour, a $90 "service fee", a $150 "equipment fee"; total, 300 bucks, thanks for coming! Are you freaking kidding me. I didn't say anything as I knew this guy was just an employee and I could tell even he was embarrassed about asking for the money, but one thing is for sure they'll never see my business again. I just hope they ring up to find out how the job went, then I'll let them have it Sadly it seems nobody is interested in establishing long-term relationships anymore, instead it's all the big money grab while it's there. Here was a perfect opportunity for this company to have a small but steady stream of easy work, but instead their "magnet" just went out in the last rubbish collection due to their greed.
Look at Australia's "Rich List" 10 years ago and it was mainly retailers, sadly the greed doesn't stop there.
27th Feb 2012, 11:31 AM #24
Whilst internet sales receive a lot of media coverage, this article puts the overall size of internet sales in perspective.
Online retail expanding at fast pace: NAB
It also makes the point that Oz retailers have been caught napping and are only now waking up that there is a revolution going on.
27th Feb 2012, 12:16 PM #25
Personally I don't think the retailers in Australia even "get" what this is all about. Personally I have no problem in paying a premium to a bricks-and-mortar retailer if they know their product, can solve the problem for which I'm seeking to buy the product, and can back it up with good warranty and service. Yet almost invariably when I go into a store in Australia virtually none of those apply! Yet it's not impossible, go into an Apple Store to see how it should be done; there are plenty of well educated (and I'm supposing well paid) enthusiastic staff so you don't need to wait forever, they know the products and are enthusiastic about them, in addition the products simply work as (or better) than advertised. When there's a problem their warranty and service is second to none! Just last time I had a keyboard fail (I think it was even my fault as a result of cleaning it). I went to the store to buy a new one. The staff went to extraordinary efforts to try to get me a solution under warranty, even though they no longer had a warranty obligation. I was basically being insistant that I wanted to simply pay for a new one. So what happened? They GAVE me one for nothing. As a result I am more than happy to pay a premium for these products and always buy them from stores. I have many MANY thousands of dollars worth of Apple products now, indeed it's my electronics company of choice. I've had some other warranty or support experiences with them and all have been WAY above expectations.
Contrast that to a well known Australian retailer of machinery. In addition to many other things I bought a cheap wire wheel for my grinder, but it was only a 6" and not the 8" I thought it was. I returned it unused expecting to be able to exchange it for the larger wheel and pay the difference. No dice. Not their problem they said. Guess what, they can stick their over-priced products where the sun doesn't shine and I will only go to their store again if/when I have absolutely no other choice. They're even trying to sell their Chinese crap on ebay at the same retail prices. I don't expect them to be in business too much longer.
I equally believe that it's morally wrong to go into a good retailer (ie one of the few that could be described as above), pick their brains, try their products, and expect them to be the contact point for service, only to then go online to buy the product for a very small price saving. That's just not fair. Everyone deserves the right to earn a living IF they're prepared to work for it. But if retailers expect me to sponsor their laziness then they have another thing coming ... hopefully bankruptcy!
27th Feb 2012, 12:59 PM #26
It is not only the retailers, the real culprits are the importers, they set the base price. I have to say though until you have to manage the large scale importation of products you have no idea of the back end costs. Those costs are real and substantial but must be the same for most countries I would think. It takes a lot of hours to organise even a small import business and don't let anyone tell you otherwise. When you make a one off purchase it all seems so simple, try it on a larger scale and tell me what your experience is.CHRIS
27th Feb 2012, 01:33 PM #27
I am a retired accountant and did have retailers as clients, so I know the margins on which they work. Believe me, the big margins are made at the importer level, not the retailer level. Of course, the Big Chains are both importer and retailer. The small guys rarely are.
We have just done a total kitchen renovation and I did an in-depth analysis of sourcing options and costs. This covered electrical items - ovens, cook top, range hood, fridge, freezer, dish washer, etc. - and kitchen fittings - drawer runner systems, soft close hinges, handles, sinks, taps, etc. We could have flown to England or Switzerland, had a months holiday, bought the goods and shipped them home, paid customs and GST, and still saved a considerable amount on local prices. The only thing lacking would have been an Australian warrantee, but if anything failed catastrophically then we would have had sufficient funds left over to buy a new item and have it shipped from Europe!
On most items the tax free European price was approximately 33% of the Australian retail price, sometimes 25%.
Interestingly, the best deal in Australia is actually on the "agency brands" - Miele, Gaganau, etc, where the importer owns the stock in the retailers store and rigorously enforces his pricing strategy. For kitchen items of "agency brands" the Australian retail price is commonly only 50% above European prices (Vs 200% or more for other brands). It seems that the "agency importers" are using retail price maintenance to stop the greedy little sh*t from raising retail prices - the opposite of what they are frequently accused of. [Neil; please note that I did not embarass you by naming the greedy little sh*t.]
27th Feb 2012, 01:40 PM #28
Chris, I have just gone through the process of importing a lathe and it was no trivial feat. I find it difficult to believe that if somebody was routinely importing container loads full of products that they wouldn't establish a relationship with a freight forwarder who would make the whole process much easier and cheaper. Indeed from those I've spoken to who have done this more often, that's precisely the feedback I've received; like anything it gets easier and cheaper the more they've done it. Most of the relative expenses in my case were as a result of me NOT having a full container load. My neighbour, who imported a full bulldozer didn't pay much more than I did in wharf fees. I agree, the wharf situation in Australia is a disgrace bordering on criminal, but I don't buy that (pardon the pun) as the reason for the absurd disparity in price between goods bought locally compared to overseas. I've flown stuff in as air freight (and I'm not talking posting or using a courier company) and it was in contrast quite straight forward. Many of the companies I'm referring to (such as the one I referred to above, it's first name sounds like something many of us have on our heads ) they don't even deal with middle-men, they import directly from the factories.
Graeme, besides the above, that is all once again returning to the cost basis, and the reason I feel retailers in Oz just don't "get it". As I said above, I'm more that happy to pay a premium if I feel the retailer is working for their money in providing a solution to my needs. So while cost is definitely a factor, it's not the only factor. However I simply refuse to pay a premium for absolutely nothing. Greg and I have the luxury of routinely shopping overseas in person. I can't speak for Greg, but with his background I would be surprised if he didn't agree that the difference between the traditional Australian retailer and a US retailer is like night and day. In the US the culture is one of wanting and NEEDING a person's business to survive. If they don't, competition says you'll walk down the road to the next store and buy it. Not only does that sharpen up the price, the service just craps all over what we've come to expect here as the norm. In US retail they typically employ morons on minimum wage (which really IS minimum there), so you'd expect the service to be poor. However the corporate culture of the company they work for more than makes up for it. The corporate retail culture in Australia has grown fat and lazy on past success and is now turning to any possible excuse under the sun to try to justify their imminent failure. Personally I have absolutely no sympathy.
I do agree however that often the problem in Australia are too many middlemen trying to "earn a living" off of too little. They get an exclusive distribution right to a product in the country and milk it for all it's worth. One thing I'll never suggest is that the small retailers are somehow swimming in money. In their case my objection is the very poor service they simply think is part of the retail "experience".
27th Feb 2012, 02:08 PM #29
Here again another subject that would be much better placed in 'nothing to do with woodworking. How about observing the practice of posting in the appropriate section
Could the mods please move this to the right setion please
Demand Real Poo!
27th Feb 2012, 02:16 PM #30CHRIS
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