Has anyone noticed the price of tools?

[woodhenge]

G'day all,

Has anyone noticed that since the demise of GMC/Triton in Australia, the price of power tools has gone ballistic? Even the GMC tools which are still floating around on sites like Ebay are bringing insane prices, considering that there is no warranty or service available.

Regards

Neville

[bsrlee]

Well Festo aren't complaining, it makes their prices look better (having spent $1400 on Festo this month). I have noticed that prices of power tools and stationary machinery have been rising fairly steeply lately, the old problem of when the dollar gains value the prices rarely drop, and then when it plunges the prices rise by more than the difference.

Some operators are on a thin margin but others aren't, their success or failure depends on whether the number of buyers is fixed regardless of price - what number of people will buy their product regardless of the price, or will more people buy if the price is lower, and is the total profit from more sales greater than the profit that can be gained from the must-have-it crowd. The problem is guessing where the limit is for the serious hobbyist.

For mine, the raise the prices regardless to maintain overall profits is one certain way to go bust, and it has been (1920-30's) the way into a deep depression.

[munruben]

Bunnings still sell some cheaper brands of tools. The great thing with GMC was, it kept the prices of other tools, being made by other manufacturers, from going throgh the roof.

[TP1]

Bunnings still sell some cheaper brands of tools. The great thing with GMC was, it kept the prices of other tools, being made by other manufacturers, from going throgh the roof.

Absolutely. They also had a big profile through their marketing efforts which put real pressure on the rip off merchants.

[woodhenge]

Not only have the prices of powertools gone through the roof but what I noticed was that in the last 18 months or so there, seems to have been a significant quality increase in GMC tools. The competition of the relatively cheaper end of the market has gone back to being very ordinary and basic in terms of quality. I am sure that people like Ryobi was very glad to see the demise of GMC as their prices in Bunnings are at least 25% higher than they were when GMC was a serious competitor. Does anyone know whether anyone is importing the tools rebadged from the manufacturer that GMC was using? I have noticed a couple of new lines in Mitre 10

[montiee]

Yep. It was a sad day when GMC closed it's doors for me. They made some pretty decent tools for the price. Now we are left with junk like ozito and ryobi to chose from. Ryobi won't ever get my business though and ozito will have to do for the "throw" away/use once in a while tool category. How I do miss GMC....

[montiee]

Well Festo aren't complaining, it makes their prices look better (having spent $1400 on Festo this month).

People who bought GMC wouldn't of bought Festool in the first place. Completely different markets so it doesn't really matter how "better" the prices look in comparison :lol:. Even with the price bump people wouldn't buy Festool if they were not inclined in the first place.

I also think there is some profiteering going on at the expense of the GFC as an excuse. Our dollar fell initially which made retailers boost prices as an excuse but now the dollar has gone up they are quietly ingnoring it and charging as if our dollar was once again at 59c. Now that our dollar has gone up and the US is struggling it might be a smart time to import some tools in from the US once again. I'll look into that going forward. Globalisation is starting to work for the consumer for the smart shopper rather than just business.

[bsrlee]

Actually, I should have said in my previous post:

Its not just tools that have gone up strangely. I was shopping for a basic wok-like pan for use on the electric stove top - aluminium, non-stick, flat bottom. Was I surprised! The prices have at least trippled since I last looked, and even the cheapest Target offering is MORE than the price of a Breville self contained wok/frypan that includes its own heating elements, lid & accessories in a box!

Something is going very weird in the marketplace when that sort of pricing occurs.

[VEK TOOLS]

.

I also think there is some profiteering going on at the expense of the GFC as an excuse. Our dollar fell initially which made retailers boost prices as an excuse.

As a retailer i would agree with you......but its not up to us as the retailers to adjust the prices when the suppliers havent adjusted our costs.

We had to take multiple price rises at the start of the year with the Australian dollar dropping from suppliers some were even up to 35%. Now that the Aud has come back up we are still to see a price drop:no:

We had the same thing happen to us when petrol prices, alot of suppiers took the chance to bump up prices again stating the freight costs went up some even changed the FREE INTO STORE buy in from $100 to $1000,so if we didnt have the order at $1000 + we would be charged freight

Since both increases from suppliers (petrol or dollar excuse) we are still to see a price drop:~

I can definately promise you the only people making money in the retail sector in tools are the suppliers as they are able to adjust there costs on their products with us having no choice in the matter. On most powertools a retailer makes 5-15% average gross profit, makes it hard when most increases have been from 15-35% over the recent months

[Bitslong]

As a retailer i would agree with you......but its not up to us as the retailers to adjust the prices when the suppliers havent adjusted our costs.

We had to take multiple price rises at the start of the year with the Australian dollar dropping from suppliers some were even up to 35%. Now that the Aud has come back up we are still to see a price drop:no:

We had the same thing happen to us when petrol prices, alot of suppiers took the chance to bump up prices again stating the freight costs went up some even changed the FREE INTO STORE buy in from $100 to $1000,so if we didnt have the order at $1000 + we would be charged freight

Since both increases from suppliers (petrol or dollar excuse) we are still to see a price drop:~

I can definately promise you the only people making money in the retail sector in tools are the suppliers as they are able to adjust there costs on their products with us having no choice in the matter. On most powertools a retailer makes 5-15% average gross profit, makes it hard when most increases have been from 15-35% over the recent months

Some good info/reasoning there.
I share the same general sentiment but at the same time I imaging that suppliers who ordered in stock when the $ was low still have to sell it out before ordering new stock at cheaper prices. Not familiar with how warehousing works and how cost prices are/aren't averaged etc but this seems to be a factor worth considering.

Still, for us as consumers it sucks regardless and no doubt there are opportunities that are exploited by some at all points of the process. :(

[woodhenge]

G'day all,

These days even wholesalers generally don't keep large stocks regardless of what they would have you believe. Generally wholesalers use the "just in time" methodology, relying on a constant supply from the manufacturer. Most wholesalers would not keep more than 2 - 4 weeks supply of an item based on actual stock flow. Having been an importer, I know that most importewrs are very aware of currency fluctuations and are loathe to keep a lot of stock. Usually claims of "needing to get rid of old stock first" are simply that, a claim in support of price gouging, which do not reflect the reality in the warehouse. Any one that runs their business with months supply of stock is stupid and should not be in business. Aside from that, the prices that importers are actually paying in china for products leave a LOT of scope for price flexibility. It is really all about greed.

[Christos]

Yeah prices have increased. Good thing for me thou is that at the moment I do not have the funds to purchase anything. :doh:

[montiee]

Not familiar with how warehousing works and how cost prices are/aren't averaged etc but this seems to be a factor worth considering.

Swings and roundabouts really. When they had the cheaper stock they didn't sell it for the cheaper price but jacked up the price of goods immediately. Now that the dollar is back up however it'll be years before anything drops if retailers have there way. Warehousing like alot of things is a bit of a joke excuse. Even when tools were "cheap" we were paying much more than our overseas counterparts with similar costs of living. I ordered all my cordless kit in from O/S and saved hundreds despite shipping costs. Aussie business just like to pass the buck and blame everyone but themselves. Fact of the matter is that profiteering has been going on in excess of what one could deem reasonable when it comes to tools and quite frankly alot of things in the aussie market. Sad thing is if we didn't have Bunnings prices would be even worse. Personally I'd wish the likes of Mitre 10 would shutdown and multinational hardware store open up in it's place.

It's kind of like how aussie made goods shipped to NZ are cheaper there than they are here despite shipping costs :lol:. I'm sure there are excuses as well like their always seems to be but rarely with any real truth behind it :Wink

[montiee]

Yeah prices have increased. Good thing for me thou is that at the moment I do not have the funds to purchase anything. :doh:

Yeh I was lucky I bought alot of decent kit over a year ago. Unfortunately had to buy a metal cutoff saw this week so went for a cheapie Ozito one for $120 with 3 year warranty. Looked at the next level kit and it was double in price and wasn't anything flash either. The ozito will do me enough for the job I need. Would of preferred a GMC one though..

[TP1]

The internet is the only way consumers can get true competition in pricing. Buying interstate and overseas can save money, and most importantly sends a message to the Aussie distributors and retailers that there is true competition on their doorstep.

The Bunnings approach follows the US Home Depot model which shows that more sales will follow if the price is right. I know there are exceptions but the tool industry has some familiar traits with other industries where too many Aussie distributors don't care about sales volumes. They are often primarily fixated on high profit margins for the least amount of effort.

[markharrison]

There are some fascinating things going on at the moment.

1. Inventory levels are being managed at razor thin levels. Anyone claiming they are selling old stock won't be able to use that excuse for very much longer. End of the year tops. What is my evidence? I have a friend who is an AQIS officer at the Port of Brisbane. The Port of Brisbane (in the container handling area) is running at less than half capacity according to him. I have seen similar reports in the local paper that services this area. I also know that there have been multiple layoff tranches at the port.

2. Have a look at what some bigger ticket items are selling for new versus two years ago. I bought a Powermatic 2000 saw for $3500 two years ago. Same saw is now over $5500. This is possibly the only investment that I have that has actually made money in that time. Now that is weird! The AU dollar is roughly (actually less than current rates, I checked) where it was two years ago so I have no idea how they justify the 57% increase.

3. I am looking for glasses frames. They is no official importer for them but I know of a specialist here in Brisbane. They're not in stock (meaning they will have to order from the US, see point 1) and they want AU$390 for them. I used Froogle to search for them in the US and I found them for US$75 plus US$31 postage and handling. Let's say they pay the cheapest retail like I did, which they wouldn't, that's a markup of 225% without the hassle of holding stock. I politely declined.

[soundman]

lets talk about some reality here.

Has anybody baught some steel or aluminium latley.

Steel has gone up in price over 100% over the last year or so.
BHP/ RioTinto... hit the chineese with a 70% proce rise in one hit...why do you think the chineese wated to buy RIO.

I was using a bit of aluminium a while ago... there had been some very heavy price rises like 30%, 60%. 40%.all on top of each other....the aluminium man would no longer give me a price list.

Then there is copper...... not as bad as it was 10 or so years ago......you would go the the wholesaler....if you got the same price as last week or they didn't get the calculator out... you wern't getting a good price... you paid manufacturing cost and the daily per KG rate for copper

The chineese have been consuming so much metal (pre recession) that the demand has over run supply so the price went sky high.

So metals that contribute so much to to sort of things we are talking about has gone sky high......so one would expect a price rize.


The economic shenanigans has also caused lots of things to go up in price independent of the currency fluctuations.

The money neede to finance jsut about everything has become much much more expensive to borrow.

AND

remember I posted that I expected all sorts of things to go up in price after the olympic games..... the chineese had been subsidising all sorts of manufacturing ...more than usual...so that it all looked good while possible customers were in town.....now eith the economic down turn they also have better reasons not to subsidise as heavily.

Yep prices are going up.....in QLD.. electricity, car boat and trailer rego, rates, water fines and almost anything you buy from the government.

Almost all the companies I buy off have incresed prices considerably......some wont even print new catalogues or price lists... na mate you'll have to look on the web site.

Electus/ jaycar, stuck about 20% on across the entire catalogue.
Velcro that hadn't had a price rise in over 10 years stuck a big chunk on their price list a while ago.

Australia post just put up their prices.

Carbatec... have a dsclaimer on their cataloge saying to check the web site for current pricing.

Motackle will not list Shimano prices in their cataloge because of the volatility.

Yop folks prices are going up... big time.
And yep... just about everybody has been trying to clear old stock and slow moving lines since before christmas....... man there have been some bargins out there.... the companies need the cash and they don't want to get stuck with old stock they have paid the GST on and they will have to depreciate come tax time.

When this whole thing settles down.....don't expect too many bargins or discounts and expect all sorts of things to be a lot more expensive.
Yeh man it wont be a good time to be poor.

cheers

[ajackson]

I have quiet a few GMC tools I purchased new from 2005 onwards and they all still work great. Everyone laughs at me when I turn up a work site with my trusty GMC 184mm circular saw but I look after it and it has served me very well along with my 14.4v cordless Drill. Although I am worried what to do when the battery eventually dies …..
<O:p</O:p
Is it true they are only built to last 100 hours ?
<O:p
I have purchased another three GMC power tools new this week form an online auction site here in <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-comhttp://www.woodworkforums.com/ /><st1:country-region w:st=Australia</ST1:p</st1:country-region> and hope they will serve me well.
<O:p
I am not sure about Ozito, have had to take back two of there tools for exchange I don’t think they are as good as GMC was.
<O:p</O:p
Now it is very hard to buy any other brand as my mind is programmed at GMC prices

[TP1]

I am a business and tax adviser by profession (you can tell by looking at my woodwork!) and one client recently told me that they are putting prices up to help offset declining sales. Yes, you are right in guessing that this will lead to even less sales, but the higher prices do stick sometimes. Haggling is a must these days

Also, the demand for certain gear is still healthy and it is a sellers market at certain times, consider the following:

1. When Kev's $900 handout was being made, certain industries co-incidentally put up prices - Plasma TV's for example, went up significantly across he board the week the payments were posted out.

2. The generous business tax incentives have caused big demand for machinery and motor vehicles prior to 30 June. This caused prices to stay up but on the flip side, used gear should be cheaper than ever right now.

[Johncs]

Bunnings still sell some cheaper brands of tools. The great thing with GMC was, it kept the prices of other tools, being made by other manufacturers, from going throgh the roof.

Strange

I was in Bunnings the other day. The prices of some power tools (Ryobi and Bosch) haven't changed in a year or so.

The tools were a couple of Ryobi routers and a Bosch router.

[montiee]

When this whole thing settles down.....don't expect too many bargins or discounts and expect all sorts of things to be a lot more expensive.


Actually I disagree with this. It fortunate and unfortunate that we haven't been hit as hard as the rest of the world financially however we'll eventually feel it. When that happens prices will tumble as shops will be desparate to clear stock to make any profit they can as people really start penny pinching. They haven't yet with all the tax cuts and handouts that have recently occurred. Until then what we are seeing in Australia is a last gasp price grab by retailers to buffer themselves for when that time comes so we are seeing artificially inflated prices here for the moment more than ever before.

All the contracts with China for metals and ore have been substantially cut. You should be seeing cheaper prices as surpluss bulks up. It's just part of the game to grab as much cash as you can before they are hit because as consumers we are acting like there is no problem and we are flush with cash. I've put any major purchases on hold for at least two years now as it's just not worth the ridiculous prices in alot of areas. I'll be damned if I line some business pockets as they try to rip me off more than ever before.