Thread: Why are parts so overpriced in Australia?

1. Volume of sales - UK vs Aus
2. Overheads ratio compared to UK
3. Cost of import/delivery
4. Purchase cost - to local seller will include duty + freight, plus will have to charge GST
5. Import (privately) - No GST or duty
6. Cost of holding stock - interest rates greater here than in UK

And many, many others.

Doesn't stop me importing my stuff though

If everybody starts importing stuff from overseas, this will cause the local operators to start operating more efficiently and also adjust their prices downwards accordingly.

Look at what's happening in the retail sector - Myer and David Jones have to spruce up their shops, lower their costs and profit margins coz their traditional consumers are buying from overseas.

Land Rover parts are very cheap in the UK, so why are they so expensive here?

A lot of things here are way over priced.

so,
why dont we source an overseas buyer in the UK? (the aulro buyer- together we should have quite an amount of bargaining power!)

They can shop for best price, obtain and pack & frieght to us for costs and an agreed set fee?

If we all start doing it - it should be cheap.....(and OK for the buyer)

BUT local businesses that arent gouging us will be likely to suffer and maybe close....

where do we find a happy medium?

I buy a lot of stuff locally and from Melbourne and Newcastle and form time to time from the UK depending on the urgency that I need it and who has it available I agree with what you have all said and I understand the cost for dealers to import. but I am left between a rock and a hard place most times becouse to my way of think one must sent locally first, then the rest of Australia comes next then the os comes last but it makes it hard to stick with these principles when the allmighty dollar is involved.

HODGO

I recently priced some bits for the PUMA in Aus. Best price was $4700.00 with out delivery and the supplier was about 600k's away.

I ended up buying from the UK, took 4 days to be delivered to my front door - total cost $2089.00. Same parts - Same spec -Same brand.

Loyalty to local businesses is one thing but only a fool would part with all those extra $$$$

Now I go straight to the UK for any substantial purchase, they are more than happy to help and sending to Aus is not a problem.

As sheerluck suggests there are a number of reasons, some of which apply to any business, some which are peculiar to Landrover parts.

Apply to any business:-
1. Long supply chain. The number of steps rather than the distance or freight cost is the major cost.
2. Australia has far more red tape and restrictive labour practices than most places plus high labour costs.
3. Australia has higher costs than most places for rent and almost anything else - part of this is the high A$.
4. Australia has far higher interest rates than any comparable economy, and this feeds through into higher costs for everything, particularly for holding stock.
5. Distances within Australia mean high delivery costs.

Apply particularly to Landrover parts.

6. Landrovers are in very small numbers compared to UK or many other (mainly European) places.

7. Because of this, major motor supply places generally do not stock Landrover parts and often refuse to get them in.

8. This means most Landrover parts suppliers are relatively small businesses with high overheads relative to their turnover.

9. Landrovers are marketed as luxury vehicles in Australia, and parts prices reflect this. Independent suppliers base their prices on the official prices in Australia.

John

Originally Posted by JDNSW

As sheerluck suggests there are a number of reasons, some of which apply to any business, some which are peculiar to Landrover parts.

Apply to any business:-
1. Long supply chain. The number of steps rather than the distance or freight cost is the major cost.
2. Australia has far more red tape and restrictive labour practices than most places plus high labour costs.
3. Australia has higher costs than most places for rent and almost anything else - part of this is the high A$.
4. Australia has far higher interest rates than any comparable economy, and this feeds through into higher costs for everything, particularly for holding stock.
5. Distances within Australia mean high delivery costs.

Apply particularly to Landrover parts.

6. Landrovers are in very small numbers compared to UK or many other (mainly European) places.

7. Because of this, major motor supply places generally do not stock Landrover parts and often refuse to get them in.

8. This means most Landrover parts suppliers are relatively small businesses with high overheads relative to their turnover.

9. Landrovers are marketed as luxury vehicles in Australia, and parts prices reflect this. Independent suppliers base their prices on the official prices in Australia.

John

I think this maybe were the Australia needs to do something about the problems facing business . The more people start putting dollars offshore the harder it will get for business and this is were the government need to step in.
There is hardly any manufacturing in the UK so most things come from China , it should be as easy for an Australian company to ship from China as it is for the English companies .
The major thing in the UK is competition and I have found since being in Australia places don't seem to compete , they have a take it or leave it attitude .
These problems are not Land Rover exclusive , on talking to a local man yesterday he told me he imported all the hydraulic hoses for a project from the USA at a cost of $330 inc postage( all were cut and fitted to specification ). The local branch of a MAJOR hose retailer quoted $1300 for the same parts .

Would profit have anything to do with it? I started buying parts from UK in 1988. If the cost in UK was 10 pounds, it was $40 to buy it here. The exchange rate was 33p to the $. Now the exchange rate is 65p to the dollar and a part in UK that costs 10 pound still costs $40! But before you buy overseas, do your homework first, sometimes, not always, some parts can be close to the same cost here. A small company in Brisbane that used to supply parts for english cars has recently closed down due to people buying off the internet and overseas. But he was still charging the same markup as in 1988.