Festool Pricing is very high

[Isaac Hunt]

How is it that Festool tools in Australia cost twice that of the same item in USA?
I can buy a Domino in the USA for $745 US.The same thing here is $1450 .So more than twice the price.

[BobL]

Festool are no different to any other premium product that goes worldwide. Quality chainsaws like Stihl and Husqvarna are the same.

Often the price which Australian retailers can buy these premium products is greater that US retail prices. European prices usually only differ from Ozzy prices by the cost of shipping, and maintaining a lower turnover distribution and service chain, that has higher unit cost, but should not double the price of such goods.

No manufacturer wants to lose the huge US market so they are prepared to take very small margins or losses to maintain market share. But the company still needs to turn a profit so prices to the rest of the world to recover this profit/loss are set that effectively subsidize the US market.

[bobsreturn2003]

thats true bob l but it really stinks ,although with chain saws you can get them from the usa at a great price , some of the festools were cheaper in the uk , some sellers post rates are ok some its not worth the trouble . the festool is a good thing generally , cheers Bob

[Isaac Hunt]

The fact that the Australian distributor of Festool products forbids its retailers from discounting must also be a factor.
I would have thought that this was illegal and in contravention of fair trading laws.

[I_wanna_Shed]

The fact that the Australian distributor of Festool products forbids its retailers from discounting must also be a factor.
I would have thought that this was illegal and in contravention of fair trading laws.

Apple do exactly the same thing - you'll never see discounted iPhones or iPads. I think this practice was challenged with Apple and nothing illegal was found.

[Isaac Hunt]

You can buy the Domino in Ireland for 773 Euro which is $1046 Australian.
Still four hundred dollars cheaper and Ireland is a smaller market than Australia.This would be 240 volt too.
We are being ripped off for sure.

[Handyjack]

When looking at power tools remember that America has a different voltage to Australia so the tools are made for that market.
I believe that the retailer has very little margin on Festool, and because they may not have a big turn over will discount very little.
When I bought my Festool gear I got a good price due to a:- retailer trying to clear stock. One item they could not locate price for on system so sold it at probably half price. b:- tool shop keenly priced saw and guide. Display model was the only one they had but that has not been a problem. c:- another tool shop had a good price on a kit I wanted.
So I have bought stuff at three different shops and feel I have got a good price compared to "recommended retail price".
The other ways to get a good price can be as simple as asking, or buy additional stuff at the same time, eg. sanding sheets with a sander, drill bits with a drill, router bits for a router. You might want drill bits and even if you purchase a sander the retailer may be able to give you a better price.
At the end of the day the retailer needs to make a profit to stay in business.
If you get a good price then you will be happy :). Chances are if it is a Festool product you will be very happy :):) with the product long after you have purchased it.

[Jim Carroll]

You can buy the Domino in Ireland for 773 Euro which is $1046 Australian.
Still four hundred dollars cheaper and Ireland is a smaller market than Australia.This would be 240 volt too.
We are being ripped off for sure.

So have you put your order in or are you going to keep surfing the net looking for cheaper options and bleat about the local prices all the time.

Remember at the end of the day you may be putting someone out of business and when you want something they had then you will complain again.

Buy Local Support Local

[BobL]

You can buy the Domino in Ireland for 773 Euro which is $1046 Australian.
Still four hundred dollars cheaper and Ireland is a smaller market than Australia.

Not so - Ireland is considered to be in one of the worlds biggest markets ( EU ) and on top of that it has a basket case economy where retailers are battling to sell shoelaces. I'll bet the Greek prices will be pretty good too but the Norwegian price won't.

[Darklord]

Would be nice to have cheaper prices in Australia. All my pieces cost a fair bit of money but I'm glad I purchased them here rather than outside the country. For starters they all comply to Australian Standards, all are/were covered by guarantee. All can be serviced here, no need tor power converters or plug changes, etc.

I'm happy with what I have and the convenience. I for one am sick and tired of people whinging about prices in Australia. Yes it would be nice to have things cheaper but they aren't yet all people seem to do is blame the sellers. As others have said in posts in these forums. "Most tool sellers are working on a maximum markup of 30% and less."

Now that's really ripping the pubic off isn't it. NOT! On top of that most stock was probably purchased during the past 12 mth when the dollar was much lower than now. They have to hold stock, accessories, and often parts, so you can buy what you want, when you want it, without going spare or chuck a tantrum because you want it now. Not only that they have to pay freight, insurance, gst, import duties, supply guarantee and more.

As for the population bit and prices according to population.
USA 311 million
UK INCLUDES Ireland 64 million
AU 22 million

Of course we'll be expected to pay more as we don't have the population to create the turnover needed to keep a business viable. Higher population, higher turnover = lower sale price.

It's common knowledge there are 2 ways to go in business:


Low profit high turnover
Low turnover high price

Darky

[Darklord]

So have you put your order in or are you going to keep surfing the net looking for cheaper options and bleat about the local prices all the time.

Remember at the end of the day you may be putting someone out of business and when you want something they had then you will complain again.

Buy Local Support Local

WELL SAID JIM :2tsup:

[Isaac Hunt]

So have you put your order in or are you going to keep surfing the net looking for cheaper options and bleat about the local prices all the time.

Remember at the end of the day you may be putting someone out of business and when you want something they had then you will complain again.

Buy Local Support Local

Well I will keep bleating.
I run a fine furniture business and power tools are one of my business costs.I have no problem paying more for a product from a local supplier.I am quie happy to pay ten or twenty percent more than my overseas competitors [I do export].I am not happy about paying fifty to one hundred percent more however.
So if it is choice betweeen me going out of business or Australian Festool suppliers I am afraid I will take my side every time and I will buy these tools from overseas.
It seems a 240 volt to 110 volt stepdown transformer will be one of the best investments I can make.They do not cost much.

[BobL]

As for the population bit and prices according to population.
USA 311 million
UK INCLUDES Ireland 64 million
AU 22 [B] million


You are right - it's about turnover but this is not directly related to population it's also related to consumer attitudes ie how many products you are prepared to go into hock to purchase. Many Americans own 3 cars a motorcycle or two and a couple of boats, jet skis and a shed full of tools they rarely use etc.

Another really important are that prices are also set to mitigate against future loss of sales if specific market attitudes change.

Ireland is not seen as a part of the UK but as part of the EU market (ie >500 million people or more than the US) but their prices are still greater than the US. The difference is that many people in the US are prepared to mortgage their homes and max their credit cards out multiple times to buy stuff they don't use. Europeans are not prepared to do that. Producers are terrified that US consumers will develop European frugality which will lead to sales slumps in the US so they keep prices artificially low (often below cost) to maintain turnover. One group that are laughing all the way to the bank are the Chinese because their production costs are so low.

[BobL]

It seems a 240 volt to 110 volt stepdown transformer will be one of the best investments I can make.They do not cost much.

My brother did that - bought a container load of tools back from the US after living there for 10 years. He persisted for about a year using the power hand tools and then gave up and went out and bought 240V version. I have heard of people even wiring their shop for 110V but wouldn't you know it there's never a spare outlet when you need it :)

[nt900]

Every time someone asserts we are being ripped off with Festool equipment here in Aus, I want to express the following but usually hold back. But today I will, so please consider.....

I'm not sure why Festool is picked on so much with respect to:


Prices of its product in general;
How it compares to prices in other countries.


My thoughts.....

These are some of the items I purchase for my business:


Computer Hardware
General Tools
Materials
Consumables
Services

This is what I could say about their cost.


Computer Hardware and Software - Devalued within 6 months to 3 years - then worth virtually nothing.
Tools - Good tools cost more, cheap tools are cheap.
Materials - Stuff seems so expensive and hard to get these days.
Office Consumables - Hugely expensive - seem to get little value for my buck.
Services - Everyone wants to charge a fortune to do very little these days, seems like nobody wants to quote or even do a job unless its for thousands.

I can only wish the computer hardware and software I invest in for my business only costs (per annum) what it would cost to fit out a productive workshop with Festool gear.

This is what I could say about how they compare to overseas equivalents.


Computer Hardware and Software - Seems a lot cheaper overseas.

General Tools - Good tools seem less expensive, cheap tools look ridiculously cheap.
Materials - Seems a lot cheaper overseas
Office Consumables - Seems a lot lot cheaper overseas
Services - Seems a lot cheaper overseas - people want the work.

This is what happens if I bring in something from overseas and it needs support:


Computer Hardware and Software - Local distributors won't help, warranty may be invalid.
General Tools - Local distributors won't help, warranty may be invalid.
Materials - N/A.
Office Consumables - Local distributors won't help.
Services - N/A, or hard to communicate issues and get resolutions.

But then why should the local distributor or retailer assist with a product purchased overseas.

P.S. I wish people would be a bit more careful throwing around rumours, old info, or repeating misinformation; which is not very accurate or factual. You may be misinforming readers and damaging others businesses, peoples livelihoods, and fellow consumers options.

[Handyjack]

If you are running a business, then you should consider the quality of the tool. Any expense should be included as an investment on your tax return.

Sometimes it is not just about the cheapest price. Ask a dealer if you were to buy X amount of abrasive sheets/pads will they give you a better price? Apart from time it should not cost you to ask.

[Lignum]

How is it that Festool tools in Australia cost twice that of the same item in USA?
I can buy a Domino in the USA for $745 US.The same thing here is $1450 .So more than twice the price.

Stop being a big baby Isaac, you’ve probably got enough money tucked under the mattress to buy 10 Dominos.

[LGS]

It's been a while since we had a good rant about Festool prices. I guess one had to eventuate.
Every day I thank heavens that I bought the Domino, the ETS150, the Rotex etc. They've paid for themselves many times over.

Rob

[Christos]

Does this mean there could be a group buy? :U

[Groggy]

I want to know why furniture is so expensive here when I can get it from the Phillipines or China almost cheaper than I can buy the raw goods here. :D

[Harry72]

Me too groggy!
It would be good if our goverment could impose a set quality standard for imported furniture... Start discouraging our throw away attitude!

[BobL]

I want to know why furniture is so expensive here when I can get it from the Phillipines or China almost cheaper than I can buy the raw goods here. :D

There is slight differences.

Festool: a high quality low volume product made at considerable cost, offered at different wholesale prices in different places around the world to maintain market share irrespective of and to recover the cost.

Cheap Asian furniture: a low quality high volume product made at very low cost and offered at more or less the same bargain basement wholesale prices around the world to maintain market share.

One could well say that one keeps a first world company in business while the other one drives first world companies out of business. I'm told this is how the market works and if we break it the sky will fall. :oo:

[Christos]

I want to know why furniture is so expensive here when I can get it from the Phillipines or China almost cheaper than I can buy the raw goods here. :D

Are the trees ready to be made into furniture or is it just cut, glue and sell?


Sorry gone off topic. :B

[Scribbly Gum]

Festool make fine products. They also market some lower cost alternatives in Pro-Tool.
They are not the only ones who manufacture quality power tools. OK, they are the only manufacturers of the Domino, but there are plenty of alternatives to it.
The point is this: if folks aren't happy with the pricing of Festool then don't buy any. Buy an alternative tool from a different quality manufacturer. If enough people remove support for the tool then the price either drops or the tool seller makes no sales. Clearly this isn't happening, as Festool are still in business in Australia. Therefore enough people think that the tool is value for money amortised over the period that it is used. For the rest of us who can't justify the cost, we just look elsewhere.
I don't own anything Festool, other than a vacuum dust collector, and only bought that second hand from a forumite. It is good but there are others as good.
I don't intend to purchase any other Festool products, and am happy with my Makita and Bosch items.
No one manufacturer of tools is indispensable to the manufacture of quality work. If Festool didn't exist, there would still be quality work done, just with different tools.
We shouldn't get hung up on what we can't have, and learn to get things done with what we do have.
Just my 2c worth.
Enjoy your woodwork, with or without a Festool.
SG:2tsup:

[BobL]

well put SG :2tsup:

[nt900]

Festool make fine products. They also market a lower cost alternative in Pro-Tool.

Just a small correction if you don't mind. Although some Protool tools are less expensive than a similar in Festool (for example dust extractors) Protool is not designed to be a less expensive Festool. Protool and Festool is primarily divided by function. Festool for woodworking, cabinet making, fit-out, furniture, and automotive finishing. Protool is for building, large carpentry, and construction.



No one manufacturer of tools is indispensable to the manufacture of quality work. If Festool didn't exist, there would still be quality work done, just with different tools.
We shouldn't get hung up on what we can't have, and learn to get things done with what we do have.

Taking my Festool dealer hat off for a moment.... yeah, I am amazed at what some people can achieve that I feel I need a special tool to achieve similar. Not only in the present days, but going back centuries. Or how people have adapted their personal processes to work with what they have, for whatever reason or necessities they have ended up with such tool. Now putting my Festool dealer hat back on... everyone should go out and buy a Domino system immediately! :D :D

[Bushmiller]

As well as the global market and the anomalies in pricing around the world there is another aspect.

It is that of supply and demand. Festool have set themselves up as the Rolls Royce of power tools. This is partly perception and partly reality. Sitting just below Festool are a number of suitors, but they don't have the image and quite arguably they don't have the quality.

So whilever customers are prepared to pay a premium price Festool will continue to ask a significantly higher price for their goods. When Metabo, Bosch, Hitachi and others produce a product to rival Festool in terms of marketing and quality, Festool will have to revise their own marketing strategy or go out of business.

Festool cop the flak because they are top of the pile, but tools from the other manufacturers are also cheaper in the US than in Australia. I would be a little surprised if Festool retailers in Australia were profiteering. It is driven by Festool. The only way to bring Festool prices down inAustralia would be to stop buying, but that would be cutting off your nose to spite your face.

Disclaimer; I don't own any Festool products.

Regards
Paul

[waikune]

I concur bushmiller :2tsup:

[FRB Design]

Quality is remembered long after the price is forgotten.

Why people feel the need to some how justify why they dont buy Festool is of no real concern to the ones who do. I have not met a Festool owner that thinks he was ripped off either.

We have a great distributor of Festool in Oz and many,many happy customers.




Frank.

[Bushmiller]

Scribbly Gum

You posted while I was composing my thoughts. I have duplicated a number of your comments. I'll have to learn to type faster.:rolleyes:

Waikune

Thank you.

Regards
Paul

[seriph1]

Hi Folks

I have NO desire to enter the debate about buying overseas at all, but just want to restate that buying a 60 Hz tool and adding a plug pack/stepdown transformer doesn't work. Sure the tool will "run" but not correctly, resulting in a range of issues including being potentially dangerous.

[ian]

Originally Posted by Jim Carroll http://cdn.woodworkforums.com/images/button2/viewpost.gif (http://www.woodworkforums.com/f58/festool-pricing-obscene-137177/#post1337128)
So have you put your order in or are you going to keep surfing the net looking for cheaper options and bleat about the local prices all the time.

Remember at the end of the day you may be putting someone out of business and when you want something they had then you will complain again.

Buy Local Support Local
Well I will keep bleating.
I run a fine furniture business and power tools are one of my business costs.I have no problem paying more for a product from a local supplier.I am quie happy to pay ten or twenty percent more than my overseas competitors [I do export].I am not happy about paying fifty to one hundred percent more however.
So if it is choice betweeen me going out of business or Australian Festool suppliers I am afraid I will take my side every time and I will buy these tools from overseas.
It seems a 240 volt to 110 volt stepdown transformer will be one of the best investments I can make.They do not cost much.I'm sorry Issac, but you've managed to lose me:
you run a business -- OK
tools are one of your import costs -- of course, you'd be a fool to think otherwise
Australian Festool prices are too high -- now you've completely lost me

If a power tool is a business cost, surely you buy the most economical tool for the job taking into account the total cost of ownership?
on this basis the the choice between tool A and tool B should come down to
capital cost of the tool
the tool's longevity -- will tool A last significantly longer than tool B, in other words if tool A costs $100 and lasts 12 months, and tool B costs $200 and lasts 18 months, then over 3 years you woul buy 3 of tool A (=$300) and 2 units of tool B (=$400)
the tool's productivity -- will using Tool A allow the task to be completed in less time than required if Tool B is used -- the cost of labour likely being a business's biggest variable
consumable costs and rate of use -- the classic comparision is probably the difference in abrasive paper use between sanders with vac extraction and sanders without and teh rate of wear between abrasive papers

doing the sums, a Festool is either a good buy at the price it is offered for or it is not -- either way it's not cause for bleating about relative prices here or overseas

[jmselvon]

General Tools - Local distributors won't help, warranty may be invalid.

Hi I am new here, hello from Belgium
I do not agree with this sentence. Festool where ever I bought , the local retailer is compelled to take my festool or other good reputation tools for services. Like good watches have serices worldwide.
Here in Belgium, even if I will purchase a let say Dewalt tools from Ireland, in Belgium they are compelled to service and repair the tool.

[jmselvon]

Please check the document attached.
Here too in Belgium, we are a small country, prices are crazy high, now I am buying from Ireland, I wanted a fixe base router, for making freehand routing, signs names for friends and kids of my clients. Checking the prices sold in Belgium and the one sold in the US, it's incredible.

[Bushmiller]

Please check the document attached.
Here too in Belgium, we are a small country, prices are crazy high, now I am buying from Ireland, I wanted a fixe base router, for making freehand routing, signs names for friends and kids of my clients. Checking the prices sold in Belgium and the one sold in the US, it's incredible.

jmselvon

Firstly and most importantly, welcome to the forums. It's always good to have a new perspective.

I am quite sure there is a huge price difference between the US and Belgium. You have exactly the same issues as us.

In the example you give there is a huge difference. Three times the price). Are they the same router? The Belgian model obviously has the option to be plunge or fixed base. It is not clear if the US machine has the same option. Because of the voltage difference you have to remember it is not, and cannot be, exactly the same model.

We don't see very many fixed base routers in Australia. Makita have one and I don't know who else. The Makita is very expensive. More expensive than their largest plunge router I think.

Regards
Paul

[nt900]

General Tools - Local distributors won't help, warranty may be invalid.

Hi I am new here, hello from Belgium
I do not agree with this sentence. Festool where ever I bought , the local retailer is compelled to take my festool or other good reputation tools for services. Like good watches have serices worldwide.
Here in Belgium, even if I will purchase a let say Dewalt tools from Ireland, in Belgium they are compelled to service and repair the tool.

Hi,

Sorry if my comment was not as clear as I intended. By "General Tools" I meant not specifically Festool tools. Generally speaking, local distributors here in Aus do not handle nor are obliged to handle products from outside their distribution zone. For manufacturers that do handle worldwide warranty claims, they still have to ensure tools are used within specification. Using tools on inverters, step-down transformers, etc. may be being used outside specifications. Otherthings that can hamper warranty support are: tools have to be sold through correct sales channels; warranty forms submitted within required time frames.

As for Festool, I cannot find anything on the warranty forms, T&Cs, or websites from Aus or country that confirms it's an international warranty - nor anything saying it's not.

Edit: How rude, I did not welcome the new forum member. Welcome!

[justinmcf]

hi jmselvon and welcome to the madhouse!

if you need advice on festools, you have come to the right place.
i have found the forum to be a huge wealth of information.
the fact we have anthony (nt900) here as well, is a massive bonus.

hows the summer weather in belgium?
are are you a carpenter or weekend warrior?

justin.

[Isaac Hunt]

Most power tools for our market are designed to run on 230 to 250 volt 50/60Hz.
Most likely many are really designed to suit 220 /230 volt because 220 volts [European voltage] is far more common than 240 volts.

Chinese made hi fi equipment can be bought rated at either 220 volt or 230 volt.It seems that components designed to suit 220 volts are highly prone to failure whereas those made to suit 230 volts seem to be able to cope well with a nominal 240 volt supply.I have had 266 volts measured at my meter box.

So if others are looking to buy from overseas my advice would be to avoid buying 220 volt power tools.230 volt should be fine.

My Festool tools are rated at 240 volt 50/60 hz whereas my Makita are rated 230/240 volt 50/60 hz.I have to say as good as the Festools are they have not been as reliable as my Makita alternatives.

[Bushmiller]

Can I make a quick observation on the general perception of a maker's standing in the marketplace.

A number of manufacturers have different grades of tools within their product line. Some of these are easily distinguishable and some are not. Some are only at a cursory glance different by virtue of their price.

For example Bosch's green and blue ranges are quickly identifiable as the hobby range and professional range respectively.

Makita is a manufacturer where the differences has been a little cloudy sometimes. More recently they have introduced the Maktec line for the bottom end. However for a long time they have had under the Makita brand name about three different lines; Hobby, professional and industrial.

It has been a very successful marketing strategy. Customers refer to the Makita longevity and general good name, which they do have, but often the glory from the top of the range is reflected on the lesser models, which may or may not be deserving of that standing.

I have had only three Makita tools and no complaints. I am assuming Issac Hunt, you are comparing top end Makita products to the Festool.

Festool as was mentioned in earlier posts have followed a similar path to Bosch and developed Protool, a differently named product, for their "building" range.

Regards
Paul

[FenceFurniture]

Ahh, I thought I could hear some grumbling about prices. To kick off, here are some facts without opinion:

Festool "Rubin" sanding discs, grit 180, 5" or 125mm diameter, packet of 50
USA price: $21.57 (inc freight to US)
German price: $43.65 (ex 19% VAT)
Oz price: $64.30 (inc 10% GST, freight to Oz)

Festool Router Carriage MFS-FS
USA price: $133.88 (inc freight to US)
German price: $151.35 (ex 19% VAT)
Oz price: $265.00 (inc 10% GST, freight to Oz)

Festool 250mm Fine tooth blade 80 tooth
USA price: $121.93 (inc freight to US)
German price: $201.90 (ex 19% VAT)
Oz price: $299.00 (inc 10% GST, freight to Oz)

And a powered tool to finish off:
Festool Sander ETS 125 EQ
USA price: $175.00 (inc freight to US)
German price: $316.43 (ex 19% VAT)
Oz price: $469.00 (inc 10% GST, freight to Oz)

NOTES:
The above prices were taken from websites within the last six weeks, and current exchange rates applied to them (rates have been very stable).

I have only selected Festool for comment because I just happen to have been doing a comparison on them recently (as you do), and have the prices from the three sources.

Points to make: (be careful, opinions could start here)
1. It has previously been pointed out to me that manufacturers often supply a large market with red hot near to cost (possibly below) prices and then recover profits from other smaller markets (such as Oz). Well, that's fine for them if they can get away with it, but the internet makes the world a tiny place. Personally, I don't agree with the philosophy of that policy, and I refuse to be part of any compensation. In fact, if that is the case, then I think it stinks (is that an opinion?). Will someone please explain to me why we should subsidise the US consumer, and why we shouldn't do anything about it?

2. Given that most of Europe is 230v 50Hz, I reckon you'd probably find that power tool manufacturers make a roughly equal amount of 110v and 230/240v tools. That being the case it would nullify any argument about production numbers making the 110v stuff cheaper. For this to happen there would have to be a significant difference in the production numbers (not even 2x or 3x would make that much difference)

3. I'm by no means an elec-head, and perhaps others could comment, but I can't for the life of me see how a 110v motor is significantly cheaper or dearer than a 230/240v motor (particularly when some things can be changed from one to the other by flicking a switch - I guess they are simpler devices though).

4. On the issue of Aust. Compliance: I would be mightily surprised if European market 230v tools are any different at all to 240v tools for the Oz market, with the obvious exception of the plug. That may mean that the tools are over specified for one of the markets (probably Euro), but any manufacturer will tell you that it's cheaper to over specify than it is to do two or three different runs. I'll stand corrected here if there's evidence that there are differences, because as I said I'm no elec-head. How many electrical products of any type do we see here that have the CE label on them (Certified European use)? Before I knew what that meant, I ah, didn't know what it meant, and thought it was something to do with some bloody fancy thing in the computers guts or ........

I have no doubt that Festool dealers are working on a margin of around 30% give or take, and I do not think that they are responsible for the (much) higher prices here for a moment. The very fact that Festool prohibits it's dealers from exporting out of the USA or Europe has to tell you something (or quite a lot). HA! I'll bet they don't have the same caveat here!:D:doh: I have heard on the Rumour Mill 101 that the FT dealers here don't actually own the stock, but merely act as agents for Festool, and are paid a commission. Dunno if that's true or not.

CHALLENGE:
I throw down the gauntlet for someone, anyone, to justify those prices above, and why we should be happy to pay them here. Particularly the sandpaper. It's not a matter of going a buying another brand, if Festool is what you want, it's about paying a fair price by international standards for a superb tool.

TWO MORE POINTS:
1. These incredible price disparities are not just confined to Aust v Overseas. For a set of 5 of my favourite brand of Forstners Bits (can anyone guess what that would be?) I could pay $299 in Sydney, Perth or Launceston............or I could pay $169 in Brisbane, Melbourne or Adelaide (as I learnt to my slight embarrassment when comparing prices in the Forum a few months ago). In the words of the great unelected (thank christ) political feather weight....PLEASE EXPLAIN?

2. In this example I am going change the prices to protect the innocent party involved. However, The prices are exactly proportionate, so working with %s is still accurate. The tool is very light metal, and fits on the palm of a large hand. Therefore both the components of freight (weight & size) are minimised. I will work on the premise of 30% margin for the retailer (in the USA).

USA:
$77 wholesale price USA
$100 retail price USA

Oz:
$77 wholesale price USA
$10 freight (a generous over estimate, considering the item, and the fact that it's not shipped by itself)
$- Import Duty (it's wholly manufactured in the USA)
$56 Markup
$14 GST
$157 retail price Oz

If those figure are correct, then $56 markup means a 64% margin on the USA wholesale price+freight ($87) to arrive at a pre-GST price of $143. OK, they may be some other charges in there, such as Customs Clearance, but I fail to see how they could amount to $30, which would bring back the markup margin to 30%, as suggested.

[Bushmiller]

Good to hear from you FF. I know this one is after your own heart:).

Regards
Paul

[FenceFurniture]

G'day Paul, I noticed that you declined to justify the prices! Garn, avvago!

[Isaac Hunt]

FF,
Thanks for the backup.

So the pricing is even MORE obscene than I had thougt!

[FenceFurniture]

My memory failed me on that long piece, but there's a little more diatribe to add.

This whole debate is not just about price. It's about the range available as well. My favourite brand of drill bit is on the local market here with 2.5% of the product range. That means that I/we don't have access to 97.5% of the range. Read my tips: 97.5%

I have to say that the whole pricing in Australia debate, and those who defend the substantially higher prices sounds very much like Harvey Norman and Myers complaining about Kogan Enterprises taking market share away from them. So what? Gerry's had a good long run, and things are different now. I have no doubt that multitudes of small businesses had to close their doors in the thirty something years that he has been undercutting them. Get used it or get out of the way Gerry. In the last ten years the world has shrunk like the Tenor's head in Bugs Bunny (when he inhales the allum powder - put into his inhaler by Bugs of course). And who benefits from that? Why, the consumer of course. If it means that businesses here and manufacturers overseas have to change their approach to stay competitive then so be it. Nobody wants to them go out of business, but equally, we should not have to pay in some cases three times as much just to help them stay in business. That's just another form of subsidisation.

The bottom line for me is pretty simple: I'm happy to pay 15-25% more for an identical item to account for freight and GST, and not because of a profound desire to contribute GST to the pool. It's because a small amount more makes it less hassle to get the item in question. We are the most distant country in the world and freight therefore costs more. I completely fail to see why margins need to be higher than elsewhere. Why would/do they need to be? Everyone has to hold stock, so that won't wash.

Isaac: It's not a matter of backing anyone up, it's simple observation of the facts at hand. I believe that they speak for themselves when presented clearly.

[Darklord]

FF I would love to see you bring the tools into the country a container load at t time and sell them at a 15%-20% markup. Especially after paying gst, import tax, putting a profit on for yourself, another small profit for your agent if you have one, then selling them to your independent distributors, who have to pay your price then sell them at a rate which makes it possible to stay in business, carry stock, pay the rent and everything else that goes with it.

Wake up to yourself. You couldn't possibly do it and survive.

Go find another hobby horse to jump on and ride into the ground.

Totally unimpressed with your way of thinking.

Darky :~

[FenceFurniture]

...sell them at a 15%-20% markup. Well, well Darklord, I see that you can only respond with emotive comments, and not logical, cogent argument. Had you cared to read what I said properly then you would seen the I said pay 15-25% more, and I would have thought that it was extremely obvious that this means as a consumer. So, just in case you have difficulty in understanding what I have said there, for a $100 item USA retail I would be happy to pay $115-125 here, to account for freight and GST (which is precisely what I said, even though you go on to say I haven't accounted for GST).


Especially after paying gst, import tax, putting a profit on for yourself, another small profit for your agent if you have one, then selling them to your independent distributors, who have to pay your price then sell them at a rate which makes it possible to stay in business, carry stock, pay the rent and everything else that goes with it.
Darky :~

In that statement you have missed that I had already mentioned carrying stock, and with the exception of Import Duty, every single one of the things that you have mentioned there apply to any business anywhere in the world. In fact, Import Duty is the only thing that I didn't cover, simply because it's so variable depending on the tool type, where it was manufactured. Furthermore Import Duty was referred to in the very last example "light metal tool", and in that particular case it doesn't apply.

So, when you've learnt some manners, and when you can respond with logic rather than emotion, I'll be very happy to have an argument that I make taken down. That's what this is all about isn't? Getting to the bottom of things? Did you not see that I said "I'll stand corrected"? Probably not, as I really don't think you read that properly at all.

[Scissors]

While I'm well aware of the difference in operating costs in a relatively small market et cetera et cetera, and I do love my Festools, I am a little disappointed that we haven't seen a modest drop in Festool's pricing (at least that I've noticed) since the rise of the Australian dollar. Another company whose products I am fond of, Apple Computers, are quite similar in some ways to Festool, ie: high end, price control, and have managed to drop their Australian prices significantly. While the dollar hasn't appreciated against the Euro as much as the greenback, a small cut in prices would, I expect, be feasible. I hold no issue with retailers, this is solely at the discretion of Festool Australia.

[Bushmiller]

G'day Paul, I noticed that you declined to justify the prices! Garn, avvago!


Brett

The prices are indefensible; madness even. They are artificially generated to prop up the American market because it is currently deemed essential. I am not sure this will be the case for very much longer, but that is another story and perhaps could be the subject of separate thread.

I would dearly love to see a major manufacturer pull out of the American market saying that it is financial suicide to keep selling there at a loss. I would really love to know their reasoning behind continuing to sell at a loss or near loss beyond that "it is a prime market."

I have no knowledge of profit margins in the hardware and tool retail industry in Australia. Also be aware that when talking of profit percentages it depends on whether you are marking up the wholesale price or looking back fom the retail price.

If a product is is bought wholesale for $100 and you mark the price up by 50%, it is sold retail for $150. However if you ask what the profit margin is on that retail price the answer is one third (33%) as $50 is one third of $150.

My point is how misleading margins can be depending on which way they are expressed.

Until we have rationalisation of the global pricing strategy there will be an anomaly in relative prices around the world and as you have pointed out, Australia being out on a limb, the freight is very likely to be high.

Regards
Paul

[Bushmiller]

Scissors

I suspect Apple are feeling the pressure of competition from other manufacturers. Even though these other manufacturers are not competing for the same market, the money still comes out of the same basket.

Presumeably Festool are not yet presssured to the same point. We are back to my comments about supply and demand.

If Festool see a drop off in demand you may well see a change in direction. Until that time.....:(. You may also have to wear a change in product too.

Regards
Paul

[FenceFurniture]

Bushy, where's ya bad manners, ya mug?


They are artificially generated to prop up the American market because it is currently deemed essential.
Nah, it's always been the case.


I would dearly love to see a major manufacturer pull out of the American market saying that it is financial suicide to keep selling there at a loss. I would really love to know their reasoning behind continuing to sell at a loss or near loss beyond that "it is a prime market."
Hear here. I get a strong impression that the "get the profits from other markets" is all too true. But this argument doesn't hold a cup of water - what if the economy of the profit making market goes catatonic? The idea that selling below cost to maintain market share is preposterous for obvious reasons.


Also be aware that when talking of profit percentages it depends on whether you are marking up the wholesale price or looking back fom the retail price.
Yes, that;s what I did. 25% on is 20% off etc.


Until we have rationalisation of the global pricing strategy there will be an anomaly in relative prices around the world and as you have pointed out, Australia being out on a limb, the freight is very likely to be high.
And that rationalisation will come about because....what, the companies suddenly develop a soul? IMO, there's only one thing that they'll listen to: the deafening silence of an unworking cash register.
Executif A: I vant a neu Maybach, but dis year's proffits are down! Vy?
Executif B: Vell, all the basstard Aussies haf been buying from der US, mein Geschäftsführer (Managing Director)
Executif A: Das ist der grosse bugger! Vot ve do now? Ve haf to charge der same pries across der vorld, and maybe ewen make more proffit! HA! I tink I just outsmarted meinself!

In other words, if we buy more and more from the states, then they will be forced to change their practices. Hip pocket nerve is the only sensitive one.

[justinmcf]

Jesus Brett.
Your French is atrocious!

[beer is good]

I am the happy owner of a Kapex 120 mitre saw named Fritz. When I first heard about Festools 5 or 6 years ago I was impressed by their advertising and reputation but I nearly fainted when I heard the prices. I was absolutely fascinated and puzzled as to how they could stay in business when something like a Festool router could be 4 or 5 times the price of a Bosch, GMC or Triton.

Then I began to think that Festool is a bit like Mercedes Benz cars. They have targeted a part of the market that is not looking for the rock bottom price. And I think that Festool, like Mercedes, is exploiting the value and status of its brand. Because when you compare a $120,000 Merc with a $40,000 Commodore you are not getting three times more of anything tangible. The Merc is not three times faster, more reliable, fuel efficient or comfortable. But the Merc has 3? times more status, street cred etc than the Holden.

Festool strike me as being innovators, always looking to improve design and functionality. And that costs in research, design and testing, so their prices have to recover that expense. Od course, Bosch, Makita etc do their own R & D but they can spread the cost of that over many more products.

So what can we do?
Festool seem to be happy with their share of the market and don't want to triple their production, which may reduce prices. (Personally, I think Festool should get a licence to make every power tool in the world!!)
We could stop buying Festool products ( a consumer boycott) which would force Festool to reduce prices, or they may just stop exporting to Australia and NZ.
Or we can buy them from overseas with the complications of voltage, freight costs, customs, warranty etc.

I have no complaints about my Kapex (apart from the price!) and I know that there is no compromise in its accuracy or performance, and I fully expect it to outlive me. So maybe it's worth paying more for that piece of mind.

Perhaps we could organise a bulk buy through Festool and the dealers here, with a large discount of course.

Can the ACCC or ASIC examine the prices of Festools here compared with the USA or Europe? Price gouging?

Cheap tools do have a downside. Remember GMC? Their tools were handyman quality, but they suited the occasional (not everyday use) that most of us require. But they went broke with some help from the Ryobi-Bunnings deal and that I considered to be too low. Nobody wins a race to the bottom.

[justinmcf]

the last thing i want is for festool to turn into a makita or dewalt or heaven forbid, a ryobi type company.

i dont like their pricing either, but i do keep buying because i can normally factor some of the price into a job.
when i am not working, i dont buy tools.

personally, i dont think they are price gouging.
i think they are saying this is our product, this is the price, buy it or don't buy it, your choice.

i would be very surprised if festool germany where losing money in the u.s. market.
i reckon they are making a fortune over there.

yes, the u.s. market pay less for their festools.
but compared to other tool brand names such as makita and dewalt, they are paying the same as we pay. (2 or 3 times more than the makita/dewalt tools).

justin.

[John Saxton]

Coming in late here as just returned from a couple of months overseas.

Did'nt look at Festools for price comparisons but understand that everyone is entitled to their view but again an observation that has not been made but has been stated in previous discussion on this topic.

Try buying a Festool overseas direct and getting it into OZ its been said before that unless you have someone buying on your behalf it will not happen.

For example ebay has listed Festool product from a site in the UK in the past ,they will not ship outside of the European Union ,I think the USA is the same as Festool generally will not permit selling outside of the region market.

I do have a lot of Festool gear and honestly I have'nt always justified the expense but I have justified buying good gear that should last me out .I believe that in cases of really good tools buying once is justification.

Cheers:)

[FenceFurniture]

Just a bit of :ninja: required.

[Bushmiller]

Then I began to think that Festool is a bit like Mercedes Benz cars. They have targeted a part of the market that is not looking for the rock bottom price. And I think that Festool, like Mercedes, is exploiting the value and status of its brand. Because when you compare a $120,000 Merc with a $40,000 Commodore you are not getting three times more of anything tangible. The Merc is not three times faster, more reliable, fuel efficient or comfortable. But the Merc has 3? times more status, street cred etc than the Holden.



This is a good analogy and I think very true as far as the comparison in cost between Festool and their rivals, but it doesn't address the price differential between countries for the same product.

Theatre seats are a similar story. Front row seats are many times the cost of seats in the gallery. Are they better? Yes. Are they that much better? No. Nevertheless, those that can afford them buy them.

Two issues here:

Premium pricing
Pricing across markets

The first one is a marketing strategy for a premium product. The second is a very strange and difficult to understand quest for market position at any cost:?. It is not, however, unique to Festool.

Regards
Paul

[Bushmiller]

"Bushy, where's ya bad manners, ya mug?"

I don't think you'd like to see the other side to my nature! Even I'm afraid:cool:.

"Nah, it's always been the case."

I expressed myself badly. I meant it has been and still is for the moment.


I can see that your multiple telephone conversations with Jeurgen for the "Colt Buy" have really paid dividends. You seem to have picked up the language and almost speak it like a native:D.

Sorry, gotta head off to work and pedal the bicycle to keep the forums running. Will look forward to developments:wink:.
Regards
Paul

[FenceFurniture]

Well I'll be damned: a well mannered lord of darkness. How refreshing.

[Ratbag]

Quality is remembered long after the price is forgotten.

Why people feel the need to some how justify why they dont buy Festool is of no real concern to the ones who do. I have not met a Festool owner that thinks he was ripped off either.

We have a great distributor of Festool in Oz and many,many happy customers.




Frank.


Frank, I gather we haven't met then.

Hello.

I'm a (very) disgruntled Festool owner, and I know that I've been ripped off.
Some Festool products are imitated but unrivalled. Their sanders are a prime example of this. Their range of circular and plunge saws are almost as good as the world's best (Mafell), and the finest available on the domestic market.

Some are innovative and unique, such as the Domino.

Some, however, are little more than poor imitations of better products from alternative manufacturers. In this latter category, I'd tender their range of Jigsaws, battery drills and the Kapex saw. My personal experience as an owner and user of these products has been both frustrating and irritating. I've had to purchase alternatives to these products, which is the basis for my personal feelings of being ripped off. I loathe and detest paying premium prices for inadequate products.

I'm also not alone. A local TAFE workshop has experienced problems with SEVEN of their Kapex saw stations.

In regard to pricing, however, I don't really know whether blame should be attributed to the manufacturer. Any company's pricing structure is based around a delicate balancing act . Tooltechnic systems sell less product, but at a greater margin than its competitors. This is the model they've adopted within our domestic marketplace. I suspect that they use an entirely different strategy within North America, where volume is increased at the expense of unit margins.

Is no different from any purveyor of goods and services. We all charge the maximum price that the market will bear. Charge less, and we sell more, until we saturate the market. Charge more, and sell less, or price yourself out of the market. For Tooltechnic to stay represented in the Australian marketplace as a low-volume supplier they need to charge premium prices. Remember that it's a relatively small company that lacks the R&D and marketing resources of its competitors. Yet it has a pricing and supply structure that is the envy of all others. Disregarding their obviously superior products for a moment, what other producer can charge a 50% price premium for products that are so glaringly inadequate?

Caveat emptor. Some will continue to buy product irrespective of price, suitability for purpose or percieved quality. There's legions of Holden and Ford fan(atics) out there that continue to purchase the automotive equivalent of dinosaurs. Others seek alternatives.

[FenceFurniture]

Quality is remembered long after the price is forgotten.Frank.

In which case Frank, it would be best to only start buying Festool after Alzheimer's sets in.:D That's my problem - I've an excellent memory! Just kiddin' yer sport - I agree with the basic premise of your statement.

RATTY! Wondered were you were. Like your provocative remarks there, now we're getting somewhere. So, at the risk of asking you to step into the firing line, what would be your brand picks in terms of supreme quality in the basic categories of tools (and would you mind establishing your creds?). So far you've said:

Sanders - Festool (followed by anyone?)
Spinning blade saws - Mafell, followed by FT
Domino - No contest (literally)

So what do you rate for:
Jigsaw
Drill (cordless)
Impact Driver
Drill (240v)
etc

Like your car analogy. About 9 years ago I had the option of purchasing a new Commodore for around $30-34,000 which would be a little above the base chassis with wheels model. Or I could have purchased a five year old 60,0000km Eunos 800 Miller Cycle 2.3 litre that went like a scalded bloody Rat, with all the trimmings, and leather to boot for $27,000 ($85,000 new). I chose the latter, and it was a magnificent vehicle. I always wanted a car that I could play Classical music in.

[Spooky]

Well, this is the way to encourage sponsorship isn't it! Enter a forum sponsored by a Festool Dealer and proceed to have a discussion about why the sponsor should be avoided and the business taken overseas. This forum is here to ask questions and get help or generally talk about Festools, not attack the company in their own sponsored forum.

If you like your car analogies, try going to your local Ford dealership with a megaphone and tell the customers in the lot that Ford cars are way overpriced and they can import them cheaper from the USA anyway.

I don't particularly care for the argument one way or another, but please think where you raise these issues.

There are other forums for this sort of discussion if you want to have it, have a look at his one - "HAVE YOUR SAY (http://www.woodworkforums.com/f28/) This is your chance to have your say on what ever you wish. Rant and rave. Give someone a pat on the back, or a kick their bum. ONE STIPULATION: Keep it about woodwork and related woodies stuff."

[justinmcf]

i have to disagree with you spooky.

i think this is the perfect place for people to voice their opinions.

the good, the bad and the ugly.

its called feedback. its called constructive criticism. bring it on i say. i want to hear what everybody has to say.

feedback does not have to be hero worshipping.
it can be criticism also.
if festool does keep an eye on these types of forums. then i can imagine this feedback will be used to their advantage.
good for them, and good on the people who care to voice their opinion.

i dont see many forums discussing in detail the pro's and con's of hilti, bosch or makita.

as long as we keep it civilised, i reckon its all good.

justin.

[FenceFurniture]

Spooky, it's a fair point that you make I suppose. Indeed, the thread can be moved, and the original "threader" could request that. Also, if Admin thought that it was inappropriate in this forum then they would move it.

Having said that I think Justin is pretty well on the mark too. It's not a "don't mention the war" forum, and it's not sponsored by Festool, but by one of their dealers, Ideal Tools, and the dealers have no control whatsoever on the pricing policy. That is controlled by Festool Australia, which is not owned by ToolTechnics, but rather an independent Australian company which bought the "franchise" if you like from ToolTechnics a few years ago. My understanding is that the owner was previously the Managing Director of Festool Australia when it was owned by Germany.

There may need to be a point of clarification from Isaac, but I read his original post be about the pricing in Australia, rather than the high price of Festool worldwide. The latter is easily justified because they are superb tools and YGWYPF.

[Ratbag]

Dear FF.

It's with a modicum of trepidation that I venture an opinion as to superior alternatives to Festool's "dogs".

The underlying caveat is that It's my OPINION only, and that others may wish to differ, or have differing expectations from their tools.

First, the easy ones. The Jigsaws & Drills. Festool's jigsaw blade adjustment system is just plain awful. It's time consuming and potentially inaccurate (at least in my ham-fisted hands). I either end up with premature blade burnout (too tight) or wander (too loose). If I used the same blade, in the same cut, each & every time it wouldn't be a problem. But I don't, so it is. Sigh.

The new jigsaws look very good. A stroboscopic task light? Wow(he adds cynically)!
But an accessory shoe for bevel cuts? You're kidding me. Guess what would be left accidentally behind just when you need it most? The accessory shoe. Look to Bosch for simple, intuitive push button blade adjustment, eject and lever shoe adjustment, in a simple value for money package without an allen key in sight. Or then there's the absolutely delightful little AEG hybrid Handle/body grip machines. A legacy of Atlas Copco's ownership, when they let Sweden's best ergonomic engineers loose on their power tool range. I still break into a sweat every time I fondle her seductive curves.

Battery Drills? You name it. Festool actually do a pretty good drill. However It's compromised in its usefulness in lacking key features. They're too slow (but remarkably torquey), and lacking in battery technology, both in runtime & longevity. Also, most importantly, there's no cordless "system" unlike the others. Except for a jigsaw. Did I mention Festool's Jigsaws? I thought so.

I'm a Sparkie, Builder, and "weekend warrior" renovator. I need versatility. Like most tradies, I like the look of Makita's amazing range of 18v cordless tools. There's something for everyone. They're not no. 1 for nothing. Then there's Hitachi- Koki. The lightest 3ah. batteries I've ever handled, and an equally effective and huge range of cordless tools, though smaller than big M. Then there's Metabo. The best drill chucks in the market (although someone else has been critical of them). Best grip, longest life and easiest tightening I've ever used. Their warranty is unrivalled. 3 years on EVERYTHING. Tools, chucks, batteries, globes, chargers. Everything. That's confidence!

Me? I use Bosch cordless. Best Cordless SDS hammers. OK. drills. Getting better; i.e. smaller, lighter, every generation. Powerful but fast. Gutless cordless saws (whose isn't)? Good little grinder, but no better, and probably a little worse, than the best (Metabo) and the rest M, H-K, et. al. Fantastic little LED torches/lanterns. Can illuminate a whole (domestic house) ceiling space, and run all day, on a single charge.

I just like the company's ethics. Any company that distributes some 96% of net profits to charities & humanitarian causes gets my dollar every time.

What else was there? Drills (240v)? With the demise of AEG, it's gotta be Metabo. Metabo is to drills (& grinders) as Festool is to sanders: purveyors of the world's best. It's their forte. What they do best. What they built their reputation on as a manufacturer.

Nobody makes a perfect tool. Nobody can. We all have differing expectations and requirements as consumers and users. Take the Rotex. An amazing, powerful and versatile tool much imitated (Mafell, Kress, Bosch, Makita) but never bettered. Yet it's a cumbersome generalist. It fine sands, but not as well as an ETS. It coarse sands, but not as well as a RAP (I think that's the model no... the "slow speed angle grinder" type tools), it polishes, but not as well as a dedicated polisher. Yet, as three or four tools rolled into one value package it's bigger and better than all its rivals. It is just as likely to be found in a boatyard as a panelbeaters, a furniture factory or a handyman/renovator's toolkit. I consider it to be the best tool Festool have ever designed.

Why can't they all be like that? Because it's what Festool do best. They're the world's best sander manufacturer that makes a range of other tools. Makita are the innovators in cordless tools, Hitachi-Koki are a shipbuilder and turbine manufacturer who also makes fine electric tools. Metabo makes great Drills and Grinders (and average everything else), and AEG, once one of the greats, is now just a cash cow for the owners of Ryobi, Milwaukee and Ridgid. Bosch makes the world's best jigsaw, great SDS plus & Max Hammers, and fairly average everything else. They're also, as one of the largest and most profitable corporate entities on earth, unique in being run as a charitable institution and thus responsible for both saving and improving the lives of untold thousands of the world's less privileged.

But I don't think anybody makes really bad tools any more. I think you'd really have to be trying hard to find a poor tool. Just cheap ones. Caveat emptor. You gets what you pays for.

But I still hate paying a premium price for a dud. That's a ripoff!

[FenceFurniture]

First things first. A rat with ham fists? That must really eat you up!:roflmao:

Ok, I'm alright now, I'll continue reading what promises to be a very enlightening post.

[ClintO]

I am reading this thread as an interested outsider who could never justify buying Festool.
I am curious that TAFE despite their complaints about budgets is buying Festool saws when they could outfit an entire workshop with Makita or similar good quality equipment for what they spent on Festool.
Our taxes at work?

[justinmcf]

great post ratbag.

i whole heartedly agree with everything you have said there.

i am also curious to know why tafe would be purchasing large quantities of festool drop saws.

justin.

[DoctorBobski]

Thanks for the post Ratbag. I had no idea about Bosch and it's charity work. When the time comes for new tools (or a replacement) will have them higher up the list!

[FenceFurniture]

I agree Justin, excellent and informative post Ratbag. Thanks for that.

Now I wonder if this thread should be restarted in the Power Tools Forum, because to my way of thinking, it's gone a little off topic, and could go way off topic.

Perhaps Admin could have a quick word to us, by way of Yea/nay?

Ratbag, if so, would you mind if I cut and paste some of your comments into a new thread please? There was some really worthwhile stuff on other brands there.

[FenceFurniture]

Thanks for the post Ratbag. I had no idea about Bosch and it's charity work. When the time comes for new tools (or a replacement) will have them higher up the list!

Nor I DrBob. What's particularly good (but a little self-defeating) about their philosophy is that they don't beat their chest about it (none of us except Ratty knew, apparently). It certainly changes my attitude towards the company, in that I will now do more due diligence on Bosch tools to see if they come up with the goods. I would never buy an inferior tool just to support them, but if their tool is >= the competition (for my purposes, that is) then Bosch it would be.

[FenceFurniture]

Quote from Wikipedia re Bosch (http://en.wikipedia.org/wiki/Robert_Bosch_GmbH):
"For example, in 2004, the net profit was US$2.1 billion, but only US$78 million was distributed as dividends to shareholders. Of that figure, US$72 million was distributed to the charitable foundation, and the other US$6 million to Bosch family stockholders. The remaining 96% of the profits were invested back into the company. In its core automotive technology business, Bosch invests 9% of its revenue on research and development, nearly double the industry average of 4.7%."

[Big Shed]

I agree Justin, excellent and informative post Ratbag. Thanks for that.

Now I wonder if this thread should be restarted in the Power Tools Forum, because to my way of thinking, it's gone a little off topic, and could go way off topic.

Perhaps Admin could have a quick word to us, by way of Yea/nay?

Ratbag, if so, would you mind if I cut and paste some of your comments into a new thread please? There was some really worthwhile stuff on other brands there.

Thread has now been moved to a forum more closely aligned with the new direction of the discussion.

Have also modified the thread title to be somewhat less inflammatory:wink:

[FenceFurniture]

Thanks Fred, I think it's appropriate.

[Isaac Hunt]

I think one of the real issues for Festool is that trade discounts are available on virtually every other alternative product.So those like myself who both spend more on tools and generate income from their use are placed at a relative disadvantage by not having access to appropriate discounting on Festool products.

Perhaps the Festool wholesalers could look at a system of rebates for those able to buy them under an appropriate business name and ABN.That way the retail pricing structure would be maintained but tradesman could be offered a more competitive price.

[FenceFurniture]

Good idea Isaac, but I don't see it happening any time soon. There are of course other ways to achieve the same result. Pay full price for the Festool and get something/s else for a massive discount/thrown in to give you the equivalent of a 10% discount overall. As I understand it, the problem that the dealers have is that the sales docket has to be immediately faxed through to Festool, and if any any unauthorised discount is seen then there are consequences for the dealer. This would dovetail with the notion that they are not dealers at all, but rather agents. I must point out that this is unsubstantiated.

[FRB Design]

Good idea Isaac, but I don't see it happening any time soon. There are of coruse other ways to achieve the same result. Pay full price for the Festool and get something/s else for a massive discount/thrown in to give you the equivalent of a 10% discount overall. As I understand it, the problem that the dealers have is that the sales docket has to be immediately faxed through to Festool, and if any any unauthorised discount is seen then there are consequences for the dealer. This would dovetail with the notion that they are not dealers at all, but rather agents. I must point out that this is unsubstantiated.

I think agents and dealers are free to discount,

from: Australian Trade Practices News (http://ww5.cch.com.au/atp/atp589.html)

Contravention and penalty


Tooltechnic Systems (Aust) Pty Ltd (Tooltechnic) carried on the business in Australia of importing and the wholesale supply of power tools under the brand name “Festool”. It had substantial operations in Queensland for which its Queensland area manager was largely responsible. Area managers were involved in sales and visited retailers. Tooltechnic’s Queensland area manager reported regularly to Tooltechnic’s Managing Director by weekly reports and personally at sales meetings.
In 2002 and 2003, the Australian Competition and Consumer Commission (ACCC) received complaints from Festool retailers and customers that Tooltechnic had attempted to induce Festool retailers not to sell Festool products for a price less than the recommended trade price. The recommended trade price was specified by Tooltechnic from time to time. The ACCC commenced an investigation into this conduct and brought proceedings against Tooltechnic for alleged resale price maintenance in contravention of s 48 of the Trade Practices Act 1974 (TP Act). The ACCC alleged three contraventions of the Act, all in relation to discussions between Tooltechnic’s then Queensland area managers and Festool retailers between November 2001 and May 2002. In each case, it was alleged that Tooltechnic’s managers made statements to the effect that the retailers were not permitted to sell Tooltechnic products below the recommended trade price and if they did, may be treated less favourably. The Queensland area manager had been instructed to make these statements by Tooltechnic’s Managing Director.
Tooltechnic admitted each of the contraventions. Both Tooltechnic and its Managing Director offered the ACCC an undertaking under s 87B of the TP Act. The undertakings included an agreement to establish and implement a trade practices compliance program. The parties also agreed consent orders pursuant to s 80 of the Act which, among other things, restrained Tooltechnic for a period of three years from making statements to Festool retailers or prospective Festool retailers which amounted to resale price maintenance. It was also agreed between the parties that Tooltechnic pay the ACCC’s costs in the sum of $25,000.
The court made declarations in respect of Tooltechnic’s contraventions of s 48, to give effect to the consent orders as agreed between the parties and to determine what penalty should be occasioned by Tooltechnic’s conduct. <CITE>Australian Competition and Consumer Commission</CITE> v <CITE>Tooltechnic Systems (Aust) Pty Ltd</CITE> (2007) ATPR ¶42-154.


Regards,


Frank.

[FenceFurniture]

Good Frank: detailed nitty gritty backed up by facts and evidence

So how come they don't discount?

[Bushmiller]

Well, this is the way to encourage sponsorship isn't it! Enter a forum sponsored by a Festool Dealer and proceed to have a discussion about why the sponsor should be avoided and the business taken overseas. This forum is here to ask questions and get help or generally talk about Festools, not attack the company in their own sponsored forum.

There are other forums for this sort of discussion if you want to have it, have a look at his one - "HAVE YOUR SAY (http://www.woodworkforums.com/f28/) This is your chance to have your say on what ever you wish. Rant and rave. Give someone a pat on the back, or a kick their bum. ONE STIPULATION: Keep it about woodwork and related woodies stuff."


Spooky

While I understand your allusion to not biting the hand that feeds you, that should not stifle healthy discussion nor should it permit wrongs to be hushed up (if indeed there are any).

There was a time in publishing and in particular newspapers, although I suspect it is now changed, when the editorial staff and the advertising staff were not allowed to talk to each other for this very reason. Integrity.

It is very different if the statements being made are incorrect or deliberately inflamatory. This now becomes defamatory and will likely result in libel action. Neil, the forum owner, has posts everywhere warning of this situation and you contravene it at your peril.

There is a pricing difference across different countries and Festool products are at the high end of the market. Incontoversial statements. Plain fact. This is the essence of the discussion.

High pricing? Festool are allowed to charge what they want.
Global pricing discrepancy: A strange anomaly and the essence of this thread.

I suspect that Anthony from Ideal Tools would have prefered if this discussion was not so critical of Festool, but remember the pricing discrepancy applies to anyone selling into the US. It is not Festool specific. He is probably shaking his head as so much is beyond his control. To some extent, I think that form a dealers point of view they are exonerated in that it has become clear there is little they can do and the issue is with the parent company in Germany.

As far as car analogies are concerned, do we fight shy of critising cars? Have a read of any motoring magazine if you think that. Your analogy of the Holden car yard would hold true if we were standing in Ideal Tools shop.

As it is Festool have an enviable standing within the forums (shared only with Triton I think). There is no Bosch forum, no Metabo forum etc ect.

The thread has been moved to the Power Tools section so that should allay at least some of your concerns.

Regards
Paul

[Isaac Hunt]

So what we appear to have at least enecdotally is collusion between Tooltechnic Systems Australia and its retailers not to offer discounts.Although theotertically and legally they are entitled to do so.
Either that or Tooltechnic Systems Australia apply bluffing or bullying approaches to its retailers not to discount.

Or Festool retailers that I and friends have dealt with are not telling the truth and using the "not allowed to discount" line as an excuse.It seems strange however that they are quite happy to discount other products.

The real truth would be nice but nobody here seems able or willing to provide it.

[nt900]

I suspect that Anthony from Ideal Tools would have prefered if this discussion was not so critical of Festool, but remember the pricing discrepancy applies to anyone selling into the US. It is not Festool specific. He is probably shaking his head as so much is beyond his control.

You guessed it. But its not criticism that causes me concern. In fact Ratbag's critique on best brand for different tools is probably one of the more productive posts in this thread. And even though I would disagree with some of his critique, his post is good because his opinions are based on facts based on his experiences with specific tools. Others may comment with their own experiences and draw different conclusions. I myself agree with some and disagree with other of his comments and could offer some counterpoints, which I may do, Others will join in for and against. Regardless, that would be a good discussion because it's about the tools and good tools will be highlighted regardless of brand. A discussion started in HAND TOOLS - POWERED with a post such as Ratbag's would not have been as inflammatory to begin with as the one that was started in the FESTOOL forum.

But I am very concerned about other parts of this thread. Much of the discussion includes a lot of guesswork, here-say, broad and narrow assumptions. Much I could identify as just plain wrong. But confidentiality and ethics precludes me from identifying and clarifying the wrong information. This wrong information is damaging at worst and wasting people time at best. Someone just made a statement along the lines that they don't want to buy Festool products... based on anecdotal information.

Although having this debate might serve to satisfy some peoples need to vent about something they dislike, I am not sure how productive it is overall. It's definitely not a very community building, caring or sharing type of discussion the way it always progresses. It usually just makes people upset. And this discussion just keeps on being started again in a new thread by people who don't seem to care about going back through earlier threads and reading those first. And again wrong or old information is repeated even when it has been corrected in earlier threads. I know for me it takes the fun out of participating in the forums on a personal and professional level.

If everyone put in this much effort sharing something positive about the tools and/or techniques, imagine what we could all benefit from such a discussion.

[FenceFurniture]

Isaac, take my advice. Read Bushy's post again CAREFULLY, and then edit your last post.

[Gaza]

festool is "discounted" if you know where to buy from, last week we saved a few hundread bucks on one tool from just ring around,

[Isaac Hunt]

festool is "discounted" if you know where to buy from, last week we saved a few hundread bucks on one tool from just ring around,

Would you like to name the retailer,product and discounted selling price.It would be of help to others.

[Handyjack]

Just about every item of Festool that I have, not that I have many, would have cost me less than the price displayed on websites. All items were purchased over the counter in Melbourne this year.
So yes there is discounting. One shop I frequent rarely charges the ticket price when I purchase additional items. Does not mater whether it is a power tool or not, it might just be some drill bits. So the saving might be small, but a dollar is a dollar, and I am also able to claim it as an expense in earning an income.

[Spooky]

i have to disagree with you spooky.

Take a number, join the queue :rolleyes: :D


Spooky, it's a fair point that you make I suppose. Indeed, the thread can be moved, and the original "threader" could request that. Also, if Admin thought that it was inappropriate in this forum then they would move it.Thankfully, it seems that it has moved.


Spooky

While I understand your allusion to not biting the hand that feeds you, that should not stifle healthy discussion nor should it permit wrongs to be hushed up (if indeed there are any).
No, that is not what I was getting at. I said very clearly I did not care for the argument one way or another. My point was solely about where the discussion was held. Now it has moved the point is moot, but note that the conversation is not stifled at all! :wink:

.
.
Since we are now in another, (IMO) more appropriate place for the discussion - a number of facts have been raised, yet one of the most fundamental facts to the whole issue not been discussed. That is wages, everyone appears to be assuming that retail wages in the USA and Australia are the same - they are not. It would not surprise me if it were found that Australian retail wages are up to 100% higher than in the USA. Perhaps someone should check that, just to eliminate it as a potential cause for the cost variations. Festool are not the only product significantly more expensive here than in the US or Eu so I would look first for a common denominator, wages would be the most logical place to look.

Actually, I just had a quick look, a "Team Member" in Bunnings is on $38-$42k, average retail pay in the US at Home Depot an "associate" is on $23-$28k, depending on where you look.

Next I might consider overheads and rental might be key as there is a glut in the US and EU markets, so low overheads could be affecting things too. Add in cheaper electricity and internal transport costs plus maybe a few other things like insurance and perhaps it adds up to a bit more and is not quite a simplistic 1-for-1 comparison any more. Granted, all the figures can be argued up and down and I have only done a very rudimentary check.

I still don't see why some prices are so high, but I also don't expect any retailer to expose their cost models on a forum where (probably) competitors can review them. It simply does not make business sense. The fact they don't should not be read as they are hiding something.

Anyway, I'm going to fade back into the woodwork for a while.

[FenceFurniture]

Spooky, I doubt very much that Festool or anyone else takes wages for the retailer into cosideration when they set their wholesale prices (and Festool must set the retail price as well because it's the same everywhere, in a given country).

As far as rent glut etc goes, that argument would only hold true if this was a recent phenomenon, and it's not. That would also suggest that Festool will reduce their Australian prices when the US and Euro markets recover.:roflmao:

[ClintO]

were they discounting tools on the Festo stand at the WWW show?

[Lignum]

I couldn’t care how much they costs, I will keep buying them when I have spare money. I have 8 Festools and do not regret paying what I did for any of them. They have all been punished (but looked after) and I have never once (except for bushes on the 150/3) had one issue with them. I understand there are individual comparable tools, but it’s the “system” that Festool employ that I love most. When’s the new Domino coming out:rolleyes:

[FRB Design]

:iagree::2tsup:

[FenceFurniture]

I couldn’t care how much they costs, I will keep buying them when I have spare money.
I don't think anyone disputes that they are fabulous tools Lignum. They may not be world's best in every class, but they sure have a few that are world's best, and that's a great achievement for a manufacturer (even to have one, actually), and I agree with you that the system is pure gold. The thrust is that we are forced to pay for it like it is gold, when it's only aluminium, and the rest of the world doesn't have to.

Why? Why is it just Australia?

If we were on price parity, then you would be able to buy them more often, and clearly you would, by the sound of it. Doesn't that thought appeal to you?

PS I'm buying an ETS 125 on the strength of what you said some months ago: "it's the best sander ever made. period." That was actually the clincher statement for me. Thanks for that.

[Lignum]

If we were on price parity, then you would be able to buy them more often, and clearly you would, by the sound of it. Doesn't that thought appeal to you?

This will sound very poncy:- But i dont mind the fact they are more expensive. Its kinda nice to be in a select little group of Festoolians.


PS I'm buying an ETS 125 on the strength of what you said some months ago: "it's the best sander ever made. period." That was actually the clincher statement for me. Thanks for that.

From memory my recommendation was the ETS 150/3. I have never used anything that will come close at any price. And for power and size a bigger ROS the big 8" Fein is a cracker. Isaac, do you still have yours? Unfortunately i had to give mine up because of Carpal Tunnel.

[John Saxton]

From memory my recommendation was the ETS 150/3. I have never used anything that will come close at any price. And for power and size a bigger ROS the big 8" Fein is a cracker. Isaac, do you still have yours? Unfortunately i had to give mine up because of Carpal Tunnel.

I have to agree there Lignum great sander.
Now I do have quite a few Festool tools also but in the main purchased from my local bloke a dealer whole always gives me a better price because I have built a good rapport with him over the preceeding 25 yrs.

He knows when I walk in his shop that I have an idea of the RRP of something I'm looking for and is prepared to accommodate me on price on most occasions.

You can get fair discounts.

Cheers:)

[FenceFurniture]

Johnno - quick question on your trip: what tripod did you end up getting (do a google on Markins B&S heads btw). Did your wife give you that nickname? You know "John! No!"

[Isaac Hunt]

This will sound very poncy:- But i dont mind the fact they are more expensive. Its kinda nice to be in a select little group of Festoolians.



From memory my recommendation was the ETS 150/3. I have never used anything that will come close at any price. And for power and size a bigger ROS the big 8" Fein is a cracker. Isaac, do you still have yours? Unfortunately i had to give mine up because of Carpal Tunnel.

The ETS 150/3 is a great finishing sander for use with 180 grit paper and finer.It is not aggressive enough for primary sanding.Just way too slow compared to the Metabo Duo sanders.Also more prone to vibration than the Metabo.
The 150/3 has given regular problems.I have been through multiple speed control units, which are very expensive and also a set of bearings.I also had to have a new chord fitted in place of the ridiculous plug in type.In the same time frame I have not had one problem with my Metabo sander.

The Fein sander was an absolute lemon.It went back several times to the agents for repairs.Also gauranteed to give you carpal tunnel.I ended up selling at Cashies for $50.

[nt900]

The ETS 150/3 is a great finishing sander for use with 180 grit paper and finer.

The ETS 150/3 is designed to work with much coarser abrasives than that. In fact you could use down to 40 grit if you like (I often do). But it would just take longer than using a sander with a larger orbit.


The 150/3 has given regular problems.I have been through multiple speed control units, which are very expensive and also a set of bearings.

What did your dealer and/or Festool service centre say about the issues you are having with your ETS?

[Bushmiller]

Just way too slow compared to the Metabo Duo sanders.Also more prone to vibration than the Metabo.



Interesting. I have just bought a Duo and also a 125mm single speed Metabo ROS ( just for a specific purpose).

I mention this for two reasons. Firstly, I was the person who criticised Metabo drills in another thread and whom Ratty made a reference to in his excellent post. His comment was that Metabo drills are streets ahead of the rest. In a way I agree as it was the drill chucks with which I had an issue. Two chucks disintegrated or seized on me. The drill is still going strong with an after market chuck on it.

It is a good reason why manufacturers should heed their customers. It has taken 10 years for me to buy another metabo tool!

Secondly, many manufacturers have market leaders in their range, but they also have a dog or two lurking. It is a mistake to think that every tool is going to be the best there is.

Festool is no different. The dealers know that some of their products are better than others and it is fine for us to identify where we think strengths and weaknesses exist, but I don't believe any manufacturer deserves to be denigrated because a single product is unworthy.

Just getting back to the thread and the money Festool charge for their product, they can charge what they want. It loosely comes under the law of contract. They offer a product at a price and you have the opportunity to accept or decline. I can't really come at the idea of Festool reducing their price so I can afford Festool products.

In the justification of the mind, for me, their products are too expensive so I don't buy, but there is no reason for me to be up in arms about this.

There are a number of very expensive cars I like, but I would certainly not entertain the idea of contacting those companies and suggest they reduce their prices so I can afford their product. So I continue to run a 15 year old car:(!

As for discounting, that is to my mind completely up to the retailer.

For me the main issue is the disparity in pricing between overseas markets, and the US in particular, and the Australian market. This is where we need a definitive reason.

Is it the perception of manufacturers that they have to have market share in America at any cost or is there another more insidious reason of which we are not aware? Or are there indeed other factors such as overheads and wages to which Spooky has refered?

Regards
Paul

[Isaac Hunt]

The Festoool is still a great sander because it is light and therefore much more suited to edge sanding and sanding components with lots of small components like chairs.

I have found it indespensable really.Each time the variable speed circuit has died I have looked at alternatives but they are all too heavy or just not good enough quality.I started out with cheapish light orbital sanders like Bosch and really none compare to the Festool 150/3 for the quality of their sanding.The availability of different hardness sanding pads is also a bonus.
When I am sanding veneer the last thing I want is a soft pad which will roll over on the edges and increase the chance of sanding through the veneer.

The Metabo Duo is also a very good sander but just a bit heavy for some of the applications I have mentioned.So I will continue to use and recommend both.

[ian]

For me the main issue is the disparity in pricing between overseas markets, and the US in particular, and the Australian market. This is where we need a definitive reason.

Is it the perception of manufacturers that they have to have market share in America at any cost or is there another more insidious reason of which we are not aware? Or are there indeed other factors such as overheads and wages to which Spooky has refered?Paul
to add some perspective to this discussion

1) it's regularly asserted that the cost of housing in Australia is significantly greater than the cost of housing in comparable economies -- a reason cited by the Reserve Bank a few years ago was that Australia has two large cities, Sydney & Melbourne, though some will argue that in reality there is only one, Sydney. Regardless, limited choice in where to locate if you're at the upper end of the salary tree results in fierce competition for the "desirable" real estate which in turn results in high prices which cascades down from the most sought after addresses in Sydney's eastern suburbs to eventually push up the price of warehouse land in Sydney's west. (If the $5M property you had your eye on in Vaucluse inflates to $10M, you will be prepared to pay $5M for a $2M property on the North Shore, which in turn will push other buyers with fat wallets (or willingness to take on substantial debt) further out pushing up those prices. From a business perspective, the result is higher $/sq.m rents compared to comparable markets. In the US there are at least 10 cities considered desirable places to live and work by those at the top of the salary tree.

2) Australian wages are generally higher than those payable in some comparable markets, especially the US, and wages in Sydney tend to lead the rest of the country (except for the mining sector). A comparison earlier in this thread, suggested that Australian retail wages are about 50% higher (assuming a 1:1 exchange rate) than those in the US. This comparison holds true, across most job classifications -- with the exception of doctors, dentists and lawyers where US is higher, and finance minions where Aust wages are outrageous compared to the US.

3) Australia is a long way from anywhere (maybe I should say everywhere!). You may not know, but at least one major international shipping company refuses to make port calls in NZ because it’s too costly for the volume involved – that line’s NZ bound cargo is transhipped in Australia -- some others lines would prefer to service the Australian/NZ market by transhipping cargos in east Asia, eg Singapore. The impact? International freight rates to Australia are higher reflecting either greater distance, limited competition, or a pricing based on "they need us more than we need them, so charge accordingly"

4) the Australian market is puny compared to some others, so some manufacturers provide the barest minimum level of service and others ignore it completely. Fence Furniture's experience with drill bits aptly demonstrates this.

5) the tyranny of distance in Australia itself. The distance between Sydney and Melbourne is about 850km, and it’s about 1100km between Sydney and Brisbane – in both cases by road or rail. Compared to other countries, in Australia hardly anyone lives between the major cities (my apologies to those living on the Gold Coast or at Tweed Heads, but in transport terms you’re part of Bris-vegas). What this means is that, combined with (4), the puny market, the warehousing may only occur in one location – Sydney, Melbourne or Brisbane. The necessary cost of shipping 60-70% of items sold to the other two cities is reflected in the retail price. The “classic” (possibly fabricated) example is toilet paper and facial tissues – one is made in Sydney, the other in Melbourne. Each day trucks carry toilet paper to Melbourne returning to Sydney with facial tissues. The transport cost is reflected in the retail price of these items which, through market expectation, drags the retail price of other items upwards. Another example is beer. Less than half the beer drunk in Sydney is brewed in Sydney. Tooths is the only large brewery left in Sydney, all the Foster’s labels come in from Brisbane, Melbourne or Tassie.

6) Australia has an extensive welfare system -- Medicare, "free" hospitals, pensions – from which we all benefit. Ultimately this is funded by consumers like you and I . (Yes companies pay tax, but they declare an AFTER TAX profit, so the sale price for an item includes an amount for the tax they need to pay)

7) Advertised US prices never include state and county sales taxes. I doubt if anyone anywhere has a handle on all of these, but from my own experience State/city sales taxes are typically about 8%. But they are not payable on items shipped to another state, hence the popularity of mail order. In some locations the State and local sales taxes can add 15% to the advertised price. Prices in Europe, typically include VAT etc.

8) Gyrations in the US$-AUD$ exchange rate. This has been done to death elsewhere. Suffice to say that typically, Australian retail prices tend to reflect the exchange rate applying on the day an order was placed, to which is added a margin reflecting the company's guess as to where the exchange rate will be in 12 to 18 months time. The only company I know of which updates its prices to reflect the exchange rate on a regular basis is Lie Nielsen Australia, who, I understand, place an order every few weeks.

9) Interest rates have historically been higher in Australia than elsewhere. Currently the "official: interest rate in Oz is about 5.5% compared to ~0.5% in the US


Taken together, it's no wonder many retail prices in Australia (which include the GST) are higher than those advertised in the US, primarily because the cost of doing business in Australia, particularly wages, is higher.

Given the above, it’s little wonder that it’s easy to point to particular high retail prices in Australia


The solution?
Well a labour market economist (note the "u" in labour is very important here) would argue that ultimately, world-wide real wages will even out so that in terms of labour costs (in $/hr), there is no difference between a factory making shoes in Vietnam and one making shoes in Ballarat. The same economist will not put a time line on that evening out, but ultimately the person making shoes in Ballarat must either become as productive (in shoes made per $ input cost) as an employee in Vietnam or find another job -- possibly in the Pilbara. The only workers "protected" from this harsh reality are those providing "personal services" because it rather expensive to travel to India or Malaysia each time you need your hair cut.

On the way to most of us working in, or in support of, the mining industry or as hair dressers -- or as leaches providing stuff to those in the mining and personal services industries -- we can wail and moan about the price differential for some items or suck it in and get on with it.

[FenceFurniture]

Ian, that's a very well reasoned and cogent argument. Very worthwhile. I accept (and always have) that things will be dearer here than overseas, and for a (now greater) variety of reasons.

But I say again, how does that justify Rubin P180 sandpaper being $64 in Oz and $21 in the US? Allowances can and will be made for the vagaries of this or that, and every country will have its own set of factors that cause price variances. But a 3:1 ratio?? I need a little more convincing than exchange rates, company tax, freight and so on to arrive a 3x price. It is clearly nothing to do with production runs (same paper goes to every country). There would not be a whole lot of hourly rate for wages involved either: the goods arrive here pretty much ready to rock, but there is administration etc to account for with hourly wages.

There has been a lot of very good input into this discussion. Unfortunately none of it can justify a 3x price comparison, or indeed even a 2x price comparison.

Is there anyone who can supply the answer (and who will)? Does anyone think that we should pay 2x and 3x? (note that I don't say a high price: you pay for quality).

I should say that the drills bits 2.5% of range coming here is nothing to do with what the overseas manufacturer wants. Quite the opposite.

[ian]

FF
it's not my intention to try and explain all of the price differentials that exist

However, look at it this way
a 40 foot shipping container (which is rapidly becoming the international standard) might hold about 25 tonnes of P180 abrasive paper.
how many months or years would it take the Australian market to go through that amount of abrasive? All of which has to be paid for up front by the local wholesaler and then warehoused. Even if the wholesaler brings in less than a full container, to minimise the upfront and warehousing costs, container shipping and handling costs are based on the container being full, pushing up the unit cost for each disk they do bring in.

You would expect that the US market being about 15x the size of the Australian market would go through abrasive at about 15x the rate in Australia, leading to shorter (= cheaper) storage times

I DON'T KNOW, but given the comparative volumes, and differences in shipping times, it's possible that the US market is supplied by sea freight while the Australian market uses air freight.