Why are parts so overpriced in Australia?

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Originally Posted by PhilipA

While I have no axe to grind.... sni
p
Also export prices have to recognise the competion in the export market. The USA has many competitive manufacturers to ARB, eg Detroit etc and ARB have to align prices to them to some extent at least.
So maybe now you understand the economic theory reason .
Regards Philip A

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I fully understand the economic reasoning. My take on it, however, is that they then have absolutely no right to complain when people use the economic reasoning "buy at the cheapest price" and obtain stuff overseas, given that they are knowingly charging us a high price to subsidise an overseas market.

The sad part is that not only are the companies in question ripping off the very customers that developed their business (i.e. "locals"), they are also putting money in the pockets of overseas companies - they sell cheaply to a US retailer, who charges a mark-up and sells back to an Aussie consumer!!

If they sold to Aussies at the price they sell to those US retailers, or even slightly more, the money would stay in Australia, they'd make more and we wouldn't have to ship products three times around the planet back to where they started. Crazy!

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Originally Posted by sanderm2

... If a business can't compete it will close down , things won't get easier for them . It is a global market place.
And just to point out that UK business has to pay tax , import duties , minimum wage and high rental prices. They have already added this to the price of the product and they can still keep prices down ? Why can't we ?.
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The total population of the UK is just less than three times the population of Australia and the UK will fit into NSW three times or once into Victoria. Add to that a higher proportion of 4X4 owners in the UK operate Land Rover than 4X4 operators in Australia with Land Rover. It is very easy to see why UK vendors can reduce their prices just through the economies of scale, they sell more items so they can afford to sell each one with a little less margin and still make a profit.

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Originally Posted by Lotz-A-Landies

The total population of the UK is just less than three times the population of Australia and the UK will fit into NSW three times or once into Victoria. Add to that a higher proportion of 4X4 owners in the UK operate Land Rover than 4X4 operators in Australia. It is very easy to see why UK vendors can reduce their prices just through the economies of scale, they sell more items so they can afford to sell each one with a little less margin and still make a profit.

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Spot on with the population thing!!! but as we have read so far these retailers here are still making far too much.........its not looking in there flavour...

Population is one thing, but I suspect that 4x4's make up a far smaller proportion of the UK market, both now and in the past, than in Australia. And 70% odd of the older LR models were exported. Then add the fact that it is entirely possible that the salt on the roads in the UK has permanently removed a vast number of Series Land Rovers from existence, and I wonder how big the UK LR parts market really is?

Economies of scale do indeed rely on scale, and I'm not sure that the local UK market is big enough that the Tesco's "pile 'em high and sell 'em cheap" approach works, at least not enough to explain the more than doubling of price between there and here!

The fact is that Australia is expensive. Distance, higher interest rates etc. explain that to a degree, but nowhere near completely.

Soon you'll be able to order your Landy parts in Mumbai. Just ring the 1300 number and an Indian consultant will listen and offer you advise on your Land Rover Parts, just like everything else that's out sourced.
Because we the consumer let it happen.:(

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Originally Posted by It'sNotWorthComplaining!

Soon you'll be able to order your Landy parts in Mumbai. Just ring the 1300 number and an Indian consultant will listen and offer you advise on your Land Rover Parts, just like everything else that's out sourced.
Because we the consumer let it happen.:(

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That's a vicious circle. We want more reward for the same (or less) work, a better standard of living for doing the same job as 10 years ago. As a result prices go up (to pay employees more, the employer must charge more). Then we discover that things are cheaper abroad because they are made and sold by people who don't (yet) expect quite such a lifestyle. So we import them, they are sold to the detriment of the locally produced items, and the local producer goes out of business, or outsources his manufacturing to Mumbai.

The UK has almost no manufacturing capability, and very little industry at all, because this has already happened over there. Australia still has some left, but it's only a matter of time.......

I’ve recently bought a set of 6 wheels for my 90, and without naming anyone (as the rules require!), I was locally quoted $30 more than double the retail price in the UK (for each wheel!). I briefly considered buying them as ordering 6 no 16” wheels from the UK was a bit daunting, but I was told that they don’t stock them and they will be ordering them from the UK once I paid for them... I was also quoted a delivery charge by road transport from Perth to my home in Karratha in the Pilbara that would make your eyes water.
I obviously ended up buying them in the UK, delivered to my house by UPS (including import duty and GST as the total was over $1000.00) for 60% of the “over the counter” price in Perth. If I include the local parcel service’s delivery charge I saved over half the cost quoted by a retailer acting purely as “broker”.
This has nothing to do with stock issues or complicated economics lessons, but in my opinion a blatant attempt to turn a quick buck.

And if you consider that the Australian retailer would have been buying at UK wholesale price, whilst you paid the UK retail price, you can add the UK retailers profit margin to the amount the Aussie retailer tried to make on the deal....

So if you ended up paying half what the local retailer quoted, and his buy price was less than yours by the (arbitrary number) 15% markup the UK retailer applied, the Aussie retailer was looking at 100% to 135% profit. Compare and contrast with the UK's guesstimated 15% profit!

Ever heard the phrase "I don't get out of bed for less than $20,000"?

I just went to the local branch of a well known 4WD accessories store to see if they had one of those fridge slides that lower the fridge down behind the drawers, to suit a 40 litre Engel. They did - and were asking $675. Their justification for the "high" price was $70 or so in freight to Kalgoorlie.

Not sure what they retail for elsewhere, but I've seen them advertised for not much over $500. Ended up buying a standard Engel fridge slide from the local camping store where I bought the Engel, and paid less than $300.

I also just ordered an Oztent RV5 after reading some good comments on here. From the same camping store - the price is exactly the same as advertised on the Oztent website - with no extra charge for freight.

Some retailers do the right thing ................... others seem to be there just to rip you off.

I'll always support the local business where they do the right thing. Where they don't, I won't hesitate to let them know where I'm buying my goods from.

Many businesses who supply the mining industry are no better. As soon as you mention that you want to buy something for a minesite, the price goes through the roof. An example - two weeks ago we wanted to buy a set of Hella Predators for the Playdo at work. Rang one supplier in Perth and told him who we were and what we wanted. Price quoted - $2,000 each. I don't think I've EVER seen Predators for that price. Rang another supplier and got a quote without mentioning that we were in the mining game - his price $1,300 each, and this without any discount. As it turns out, we have accounts and trade discount in place with both suppliers. We bought the lights from the second supplier at our discount price - the first supplier is no longer on our list of approved suppliers - his loss.

Mate, all of this pales into insignificance when compared to that dreaded word
WEDDING
Prices double triple and quadruple when teh word is mentioned.
Those of you who have daughters beware.
One example
We were getting quotes for cupcakes. Wedding place quoted $5 each. We ended up getting them for AFAIR $1.80
And so on with everything. greatest excuse for ripping off known to man.
Regards Philip A