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keychange

Postage Costs

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I can't believe the variation in postage cost quoted for products from UK to Australia. I just purchased some trials pants and paid 14 pounds postage where as other suppliers were quoting higher purchase price and up to 28 pounds for postage... I mean they are just pants they are not fragile, or heavy.

Then there are the guys who still charge VAT ... buyer beware .. none the less I got a great deal $115 AUD delivered while our Oz suppliers are quoting $220 plus postage for the same product. I do try and support local business but there is a limit to my loyalty.

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depends who you are buying from maybe you just have to accept that aus is a long way from anywhere theres got to be some disadvantages for living in paradise?

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Just a point from my perspective. Re the vat. If you are not vat registered you have to pay the vat when you purchase the goods plus any carriage charges which also have to be anotised into the actual cost price so after applying an on cost margin to achieve a price that you are happy to sell the item at then that is your selling price. To me doesnt matter where in the world you sell it to if you had to give a 20% discount then your margin in some cases has vanished so why sell it other than in the UK. Secondly postage. This is a pet hate of mine. When sellers say postage and PACKING buyers only hear or see postage when they inspect the label on the goods and seem to assume that all packaging is supplied free of charge to sellers by the packaging fairy not that it has a cost. In the same way that going to the post office and wasting an hour of my time while i am not working has a cost too. I bet the buyer expects to get paid £10 + an hour but they never see why the seller should. Finally unless you are putting a LOT of business through a carrier you dont get preferential rates so will NEVER be able to compete with people who do therefore your quoted "postage" costs will be higher.

I know this counts for jack 5hit with everybody but it is the facts of trading in this cut throat world. It's a business not a charity.

Not having a go at you Keychange just that i keep getting the same gripe about postage when it's actually postage and packing and sometimes i think people dont think it through. At the end of the day if you buy something look at the total package price and decide. For instance if you bought a bike for £1000 but it was in Scotland say and it would cost you £200 to fetch it plus a days wages would you have been better buying a similar bike for £1100 in the next village that cost you £10 to fetch it and no lost wages?

Edited by Old trials fanatic
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What you fail to understand Keychange is it's not the Australian dealer and importers ripping you off, but our government draconian tariff and GST system! Your "loyalty" is needed badly.

You bought those pants into the country GST and Duty free. You also only paid Royal Mail post charges which are quite cheap. (try sending something in the reverse direction, or importing on a large scale and paying DHL or UPS rates). Yet we importers pay exorbitant freight charges, then we pay import duty and then GST on top of those charges, before we even think about any mark up.

If an item costs me $100:

Then it could have on clothing 12% duty, that's $112.00 (some things have an even higher dutiable rate).

it can be 40% on top for airfreight (because no one is willing to wait these days - they want it tomorrow - and that's fair enough), so say that's $152.00

Then add 10% GST, that's $167.20 cost price for that $100 item to us.

I have to add something on top of that to pay rent, wages, etc etc and try and be there at trials events supporting riders that are increasingly not supporting us by shopping locally.

How is that fair and equitable when Joe Bloggs just pays for the padded bag, and a few pound postage fee.

If we could make our prices match what the UK dealer is charging we would.We dont want to go out of business either. But our Australian laws are putting us out of business, please dont blame us but have a look at the big picture.

Either we all should pay import duties and GST, or none of us should. But at the moment you dont, and we do.

Many retail goods importers in Australia are going out the door backwards, - David Jones, Harvey Norman, all our biggest retailers are screaming about it.

I totally understand everyone trying to get the best deal, but our import system is completely unfair and putting Australian retail on a very slippery slope to disaster.

Soon you will not have a choice but to buy from OS, no matter what the postage charges.

Stepping off my soap box right now.....

Whewww!

Edited by arnoux

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My point about the postage is that on exactly the same item from the same country of origin to the same destination there was a 100% variance in the charge - it doesn't cost 14 quid to stuff a pair of pants into a padded bag.

As for your point Arnoux - it is unrealistic to add 40% for airfreight - if you are using airfreight your ordering systems and/or demand management is failing. I can understand that the market size means it is difficult to achieve economies of scale - but that is a different issue and has always existed here. Yes you pay duty and GST but the UK guys pay VAT so it's much the same. Yes they waived the VAT on sale to me but even if they hadn't I would still be $90 in front.

The guy who sold me the pants was making bugger all profit but he is very wisely turning over old stock in order to free up cash and invest in new stock. The internet is the ideal vehicle for this strategy - I don't see it used very often or very well by many retailers and that includes Harvey Norman, David Jones etc. The internet is my business and has been for nearly 20 years and I believe that too many Australian businesses are still lagging behind in their understanding of its effective use and they just blame the poor old government - of which ever flavour is in power on the day.

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If you live out side europe then you should NOT pay VAT (ie) Australia, USA Japan etc.

If you live in europe then you need a VAT number to not pay vat...

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A cut of £14 three ways is'nt alot, would you work for that,

£28 three ways is'nt huge either.

There ain't no money in transport anymore i'll give you one guess why.

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We have been Importing goods from Europe for decades, and the costs can vary quite a lot depending on the the carrier, However as Arnoux points out, there is very little margin left for the dealer, and not much loyalty either by customers. - Fortunately most Trials dealers are in it because of the Passion for the sport, and will still help any rider who is in need of quick parts, and drive 100's of miles to support events. ( We live in a big Country as well) - But at the end of the day, any business has to show a profit.

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Commonly delivery costs should and will be referred to as postage and packaging to enable the pricing of p&p to be at the discretion of the company... This also enables cheaper product pricing with a higher delivery cost to appear at the top of price comparison websites and more recently google product search. Problem with the uk and not really related to the niche trials market is people have become to expect free delivery which is starting to mean website look, feel and performance is becoming increasingly more important, in fact even the trials market is catching up slowly.

Australia is still lagging behind somewhat with the growth of ecommerce mainly due to delivery and the distance that items need to travel, the Australian government have recognised this and are investing heavily behind the scenes... Next day delivery is almost impossible in os but expected for free in the uk.

On the other side with the trials market been new to online trading some companies price themselves out of the "posting abroad" market as it adds confusion and increased levels of hassle!

Loyalty again can easily be higher to an online website in another country if social networks and email marketing are utilised correctly but again this doesn't happen in trials... But it will come I'm sure!

And the morale to my boring story: theres no doubt that the Internet is the way forward but I've paid for my product and I want it now, delivered for free! And if it's not in stock don't let me buy it!

;)

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You can always ask the seller, (in advance), if he can ship the item 2nd class, to the sometimes different costs for freight this can also be related to the insurance of the goods that are shipped too. The costs for packaging are obligatory and have to be paid by the buyer.

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If you want to run a web store in the same way as you run your high street store you are in for disappointment ( I know there are exceptions ) I often advise my clients to think of it as more like one of those 24 hour lease clearance shops that you see pop up and disappear overnight. They are often supplied or run by mainstream shops who simply want to turn over the stock and get their cash back without diluting their image.

When you offer your normal products at normal prices on the internet its like opening a scone and tea shop in a food mall.

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Hey KeyChange

"As for your point Arnoux - it is unrealistic to add 40% for airfreight - if you are using airfreight your ordering systems and/or demand management is failing."

If we order everything by sea-freight then we have a minimum 8 week lead time, and as you could imagine stock levels would have to much higher to allow for holes in inventory. Also when a product is released we want to have it available for our customers now, not in 3 months time. A combination of Sea-freight and Air-freight has to be a part of modern business logistics.

We are constantly searching for cheaper and more efficient shipping options, but we are on the other side of the world from all our suppliers.

As we all know people want their item within a few days max of ordering and that is more than fair. Air-freight is, and has to be, a part of business stock logistics these days. It's a balancing act on stock management, and stock amounts versus freight costs to control stock levels.

If you did everything by sea-freight you can end up with a lot of sullage, or holes in inventory. And hence unhappy customers, or your clearance shop scenario.

Having our government hit us with duties and GST that Joe Public doesn't have to pay is just another slap in the face.

I will continue to blame our governments completely biased import rules. I truely standby our position that Australian retail businesses could compete internationally price and service wise, if the playing field was an even one.

And if you are true to your word and we should all just have websites for run out and clearance items i personally would be bitterly disappointed. I personally love checking out the newest and greatest, just released goodies from my favourite suppliers. That is what the internet is all about, not it being an online $2 shop, but a vehicle to access everything and anything, and get the information and service about those products 24/7.

I also think it is a great way to compare prices and get the best deal, but Australian retailers just cant compete internationally when we are being unfairly and unjustly taxed.

We are in this because we love the sport, we love the business, and we want to supply the best, good and services we can - just give us the same penalties, taxes, conditions as everyone else gets. Seems reasonable.

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Paul - this probably isn't the right forum however when you say "just have websites for run out and clearance items" - I actually said I "often advise my clients" not always however in my opinion one of the main barriers to retail profitability (and I have been a successful retailer) is stock that is not performing well enough. Fifteen years ago I created a web site called oddstock.com as a place for businesses to offload old or excess stock - it didn't take off and now eBay is providing that service very adequately.

Web sites can work very well for upmarket and niche products or bargain products - but it doesn't perform as well for vanilla products - you need a point of difference. I think that if you display online products that by comparison are not competitive with other online (for whatever reason) you run the risk of creating the perception that you are uncompetitive and that is not a good outcome. If you use the web to increase your turnover - albeit at lower profitability it may be able to deliver economies in volume without impacting your high street sales.

I am not canvassing for business as I am fully over- committed well into the foreseeable future (hopefully into retirement) but in the spirit of our mutual interest in trials I would be happy to discuss further with you - if you are interested contact me through http://www.keychange.com.au/

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