Why European pay twice their gear?

[PaulDalex]

Why European must pay twice as much their photo gear?

It is a lifetime that I fight this immoral market. Here is my current shopping list; prices in euros:

Spider 2 Pro EU: 280 USA 145
Nikon 9000 ED scanner EU 2800 USA 1221
Epson 3800 USA 1150 EU (?)

I have very bitter memories from the past. Minolta for example charged easily 3 tiimes as much.

In this internet era I am paralized. The idea of wasting half the money is a pain. Often I ordered from B&H. Even paying customs it is convenient. But recently horror stories came out in the media in my country, reporting of Custom Offices blocking the merchandise for more then one year.

Is there any justification for that? I think there is none. Warranty? So what? It is anywhere in the world. And I would not trust to send a broken camera to local distributors (I have other horror stories in this respect too). I would prefer an international warranty instead. I would even accept a short (say 90 days) warranty. In fact the theory of failure says that statistically a failure most likely occur at the very beginning or at the end of the life of a product (certaily this latter occurs when warranty has already expired anyway).

The only brand that recently behaves more correctly is Canon. Kudos to Canon , but it is just one out of so many! Too little for me. In the shopping list above I have no place for Canon

Can RFF raise his voice on this issue and give an hand to us European Orphans?

Thanks in advance to anyone that will post in this thread.

Pistach

 

[Xmas]

Take holiday in NY.

Buy gear, declare to customs, pay VAT, have free holiday, the dollar has slipped today.

Noel

 

[Ash]

Time to buy from the US I think!

 

[DMG]

take a holiday, buy in the US (get rid of all the packaging, keep the receipt and warranty)...don't declare....avoid tax and customs....by using old beaten camera bags...ps you didn't hear it from me....wouldn't buy any bodies new from the US though

 

[lubitel]

buying from US means about 25% in customs and taxes, alot of times thats about the amount one would save in the first place. I was happy to get my cv35 cheap from canada, then I paid about 40 euros in customs, at the end I paid the same amount it goes for here on ebay.

 

[mfunnell]

Well, it is difficult to respond properly to this since I don't know which country you're posting from or what its exact policies might be. I do know that suppliers are often blamed in these international comparisons for reasons that aren't their fault and are beyond their control (for instance, sales taxes and customs duties).

However, suppliers are often not blameless. They often wish to charge much more money in one market than they can get away with in another. (I'm not just talking photography gear here - there's a long and sorry history in my country in book publishing, in particular. And in the IT industry, I've been more than exposed to the standard 25% "foreign uplift", and the wonder of "global" licensing agreements that stop at the left coast of the USA.)

At some point, those corporate giants of globalisation might notice that they're actually operating in a global market and might stop trying to artificially segment markets in the hope of getting away with whatever they can charge. Whether that might be by "region-encoding" DVDs or by having local-purchase-only warranties on cameras (of which, at least here in Oz, Canon is just as guilty of as the next guy - and, BTW, Leica is not.)

I think "global pricing, global warranties and global service" is on its way - but its still a way off (as large companies seem to have awfully thick skulls, and often think that gouging for immediate profit is smarter than building long-term good customer relationships). But nothing will stop governments from putting their own structure of fees, charges, taxes, "facilitation fees", customs duties and other costs on top of that (for reasons both good and bad). IMO, companies would be well advised to actually supply global-everything price and service - and then advertise in as transparent a manner as possible all the government-imposed additional costs as being, well, separate and beyond their control.

Sorry, but I can't help it: I'm an un-reconstructed free-trade and not-quite-libertarian kind of guy.

...Mike

 

[rxmd]

And the Euro is quite high at the moment. This means that (a) US prices seem comparatively low and (b) companies are tempted to reap windfall profits by keeping their European prices the same and keeping the profits from the exchange rates for themselves.

For example, Apple is notorious for doing that. When the dollar was strong in the 1980s and early 1990s, their German prices would be easily 50% over their US prices on grounds of the exchange rate. When the Euro became stronger, they kept this ratio, and instead of adjusting the price ratio for exchange rates, they get to keep all the extra money for themselves without anybody noticing. Well, as long as you don't compare prices.

On the other hand, customs eats away much of the price advantage. You can try buying used stuff and hope that customs won't notice, of course, but that's not particularly promising. And then there is the issue of warranty; many companies don't offer international warranties (meaning you have to ship your stuff to America to have it repaired), and with many the US terms of warranty are worse than the European ones.


Philipp

 

[mfunnell]

And the Euro is quite high at the moment. This means that (a) US prices seem comparatively low and (b) companies are tempted to reap windfall profits by keeping their European prices the same and keeping the profits from the exchange rates for themselves.

Good point! I know it, but I missed it.

...Mike

 

[mfunnell]

We are far away from a global border-less world, even if the internet makes it seem like it.

Roland,

Fortunately, I think that the internet (and some other things as well, like having lived in lots of places) makes it even more obvious that we are far from living in a global border-less world. And in many ways I find that OK. I like where I live, for a number of reasons (though I have a long list of improvements ).

I am not arguing that everything should be the same, but I am saying that a bit of transparency would be nice. If it were obvious what charges were from, say, government then we taxpayers could judge what benefits we were getting from the deal. And if companies were transparent in saying "you live in a tin-pot country, and if we want to over-charge you for the our product then, well, tough" then that might tell us a few things as well. Of course, companies (and countries) want to reap the benefits of globalisation, where it suits them, but don't want to pay adjustment costs (or give up the advantages of monopoly and rent-seeking behaviour) where they can get away with it. But Adam Smith (their much-unread alleged hero) had a bunch to say about merchantilism (extensible to corporate quasi-mercantilism) which they're not so fond of mentioning.

"Capitalise your gains and socalise your losses" works well, but only if people let you get away with it. Of course they all do, all the time. You won't begrudge a little moaning about it, though, will you?

...Mike

 

[uhligfd]

Interesting question; with another answer not covered as of now:

Social services, living conditions, pay scales in Europe are much more equalized top to bottom. Here B+H uses - I presume - minimum wage labor to stock and ship your stuff. There employees are paid living wages. Taxes are high over there, too, but you get a full ride on health care, old age and welfare ...Here you live in trailer parks if you work at Wmart ...

It is what you get for your taxes that matters to Europeans, here our taxes go 40% to the military and we engage in ready wars. There you live freely, here ...

I hope I do not offend, but it is a question of the social net. There the same BMW costs 60% more than it does here ... due to minimal costs and wages and the large spread between rich and poor in the US, the disparity of wages and living conditions.

Usually you get and benefit from what you pay. Taxes are good since they even the playing field, but maybe we should lower the min wage here, in order to buy cheaper Leicas; those of us with 6-7 figure salaries that is.

 

[Ash]

Interesting question; with another answer not covered as of now:

Social services, living conditions, pay scales in Europe are much more equalized top to bottom. Here B+H uses - I presume - minimum wage labor to stock and ship your stuff. There employees are paid living wages. Taxes are high over there, too, but you get a full ride on health care, old age and welfare ...Here you live in trailer parks if you work at Wmart ...

It is what you get for your taxes that matters to Europeans, here our taxes go 40% to the military and we engage in ready wars. There you live freely, here ...

I hope I do not offend, but it is a question of the social net. There the same BMW costs 60% more than it does here ... due to minimal costs and wages and the large spread between rich and poor in the US, the disparity of wages and living conditions.

Usually you get and benefit from what you pay. Taxes are good since they even the playing field, but maybe we should lower the min wage here, in order to buy cheaper Leicas; those of us with 6-7 figure salaries that is.

I can agree, but only to an extent. The gov't in the UK really has messed up lately. Public Transport costs are rising, Health Care is a shambles, etc. We may pay more tax for 'better living' but to be fair every job I've had I've still been paid the lowest possible income, because the consumer wants things cheap. I'm lucky I still live with my family, because at the cost of 17% income tax and £5.35 an hour I won't have a life outside of a cardboard box if I was paying my own living costs.

 

[dazedgonebye]

Interesting question; with another answer not covered as of now:

Social services, living conditions, pay scales in Europe are much more equalized top to bottom. Here B+H uses - I presume - minimum wage labor to stock and ship your stuff. There employees are paid living wages. Taxes are high over there, too, but you get a full ride on health care, old age and welfare ...Here you live in trailer parks if you work at Wmart ...

It is what you get for your taxes that matters to Europeans, here our taxes go 40% to the military and we engage in ready wars. There you live freely, here ...

I hope I do not offend, but it is a question of the social net. There the same BMW costs 60% more than it does here ... due to minimal costs and wages and the large spread between rich and poor in the US, the disparity of wages and living conditions.

Usually you get and benefit from what you pay. Taxes are good since they even the playing field, but maybe we should lower the min wage here, in order to buy cheaper Leicas; those of us with 6-7 figure salaries that is.

If you hope not to offend, you should try a bit harder.

I doubt seriously that B&H could find someone to sweep their floors for minimum wage.

 

[rxmd]

There the same BMW costs 60% more than it does here

Does it? That's interesting, seeing that it's a German product. I didn't know that

It's usually difficult to compare prices on the basis of exported commodities because it really depends on the market. By looking at Leica prices, for example, you'd think that prices are the same everywhere.

A handy tool for this kind of comparison is the Big Mac index that's been published by the Economist since 1986. It's the price of a Big Mac at McDonald's. It's a commodity that's available and identical everywhere, that's produced locally at the lowest possible price everywhere, and that's made largely from local products. That makes it a good standard by which to compare price levels and purchasing power. The Big Mac index for the USA is about 3.10 USD, for the Euro zone about 3.80 USD or 20% more, for Switzerland it's about 5.20 USD or almost 70% more, and for China it's 1.30 USD or about 60% less. (Data from http://www.oanda.com/products/bigmac/bigmac.shtml; the Economist's page at http://www.economist.com/markets/bigmac/ requires subscription)

Philipp

 

[darkkavenger]

<fun>
So if I resume : eat your big mac in china, buy your bmw in germany, drink your beer in Prague, eat your pizza in Sicily and buy your cameras in USA / lenses in japan ?

Whee! Globalization! I'll get my foie gras and champagne in France this year though

To make it sound funnier (but this is the truth), I eat big mac in Prague, we bought our bmw in France, I buy czech beer in Monte-Carlo, eat pizza everywhere and buy cameras/lenses either in Prague or in USA/Canada
</fun>

I generally purchase from a local vendor unless the good is unavailable, in this case I'll use internet. I purchase goods abroad only when it's items under a certain value, else the disadvantages can become very annoying :

- delivery delays
- shipment cost
- eventual taxes
- possibility of damage/loss during the transport
- misunderstandings / contestations
- payment issues
- more taxes

But of course 80% of the above happens marginally.

Just my two heller (czech cents)
Max

 

[Ash]

I generally purchase from a local vendor unless the good is unavailable, in this case I'll use internet.

I buy all that I can from Peter Gilbert's in Swindon. He's not a rangefinder dealer however, so I have to buy a lot of my stuff off the net. I prefer my money to go in that shop though, that's why I look in there every other week to check whether he has something off of my mental wishlist.

I'd prefer to buy locally if it meant that local economy was strong. Or else, if I like the people in the shop.

 

[dazedgonebye]

Does it? That's interesting, seeing that it's a German product. I didn't know that

It's usually difficult to compare prices on the basis of exported commodities because it really depends on the market. By looking at Leica prices, for example, you'd think that prices are the same everywhere.

A handy tool for this kind of comparison is the Big Mac index that's been published by the Economist since 1986. It's the price of a Big Mac at McDonald's. It's a commodity that's available and identical everywhere, that's produced locally at the lowest possible price everywhere, and that's made largely from local products. That makes it a good standard by which to compare price levels and purchasing power. The Big Mac index for the USA is about 3.10 USD, for the Euro zone about 3.80 USD or 20% more, for Switzerland it's about 5.20 USD or almost 70% more, and for China it's 1.30 USD or about 60% less. (Data from http://www.oanda.com/products/bigmac/bigmac.shtml; the Economist's page at http://www.economist.com/markets/bigmac/ requires subscription)

Philipp

The Big Mac index looks handy.
While in the Navy, I had a less formal index...how much did a pack of smokes and a shot of liquor cost in various ports. As I recall, I could afford to bathe in rum in the Virgin Islands and drink responsibly in Germany, but could barely afford to wet my mustache in Norway.
I never cared for big macs.

 

[jlw]

I've read that Euro prices are higher in part because many European countries still allow "retail price maintenance," which basically allows the official importer to set a minimum price that retailers can charge. Any Euro RFFers know whether or not this is true?

In the US retail price maintenance was outlawed in the 1950s as a restraint of trade. The importer can still (for example) withhold co-op advertising funds from dealers who advertise lower-than-target prices (this is why you see those "email me a better price" links on stores' web pages) but has no control over their actual sellling prices.

 

[Paul T.]

Now, for Apple gear, UK prices are occasionally less than US ones if you can reclaim the VAT; likewise RObert White is pretty competitivie with US outlets, as long as you can reclaim.

 

[EmilGil]

[...] I'm lucky I still live with my family, because at the cost of 17% income tax and £5.35 an hour I won't have a life outside of a cardboard box if I was paying my own living costs.

17%??? You'd be lucky to find anyone with an income tax below 30% in Sweden!

The tax burden is 27% in the US, 37% in the UK and 51% in Sweden, so don't come complaining about high taxes to me! I doubt that the minimum salary is that much better in Sweden, a couple of years ago when I worked in a wine shop (state-run, mind you!) I made 85SEK/hour, approx £6 at the time, which was a pretty good salary working in a shop.

I'm pretty happy I managed to register a VAT-number with the authorities, enabling me to reclaim the VAT (or even better, not pay it if I buy something in the EU outside Sweden!). I've never heard of price maintenance, I seriously doubt that the Swedish authorities would approve of that...

 

[jrong]

The tax burden is closer to 50% in the UK, considering that we have to pay almost 10% extra "National Insurance" on top of the 40% top-rate tax. And you hit top-rate tax on a professional's salary very quickly, usually by the time you're 30 (with a degree, often even without).

Rip-off Britain... that's what it is.

regards, Jin