Okay its time for a rant. Lets being with todays attempted shopping experiance, its a nice sunny day and I still can't find my misplaced Oakleys from last year. So I popped into my optician to buy some new ones he's a nice chap and keeps my eyes working nicely. So just before I purchased a new pair of sunglasses I mentioned that I was worried I'd find them much cheaper online. Being the nice chap that he is he went onto the Oakley USA site where the price was the same in dollars as it is in pounds.
This really gets on my nerve, Oakley's aren't the only people to do this A&F and others also do the same, all my A&F stuff comes from the US via a network of friends, GAP are one of the few US companies that have been caught out in the past and hence aren't too bad its still cheaper in the US.
Why do companies insist on charging us more for things, I can image that its more expensive to move goods from China where lets face it they're all made to the UK also the manufacturing costs don't suddenly double its simple profittering.
My poor optican friend showed me the cost to him of the glasses he's buying them at US retail price clearly someone is making money.
If anyone is popping over to the US http://oakley.com/pd/5539/17893 - can you pick me up a pair of these with a small case $250 is alot cheaper then £250.
Comments
I'm fairly certain Oakleys are manufactured in the States, not China.
This place has those glasses at £144 (including the polarised lenses...)
First result on Google for Oakleys...
I suspect your optician has a really bad deal with the UK distributor...
Yep I found them cheaper the optican offered them to me for £142, so I'll be in to buy them tomorrow. Between my dad and myself we've spent over £1k with them this year alone. Im just fed up with companies charging the same in dollars and pounds. I doubt the Oakleys cost more then £10 to actually make.
There are lots of different reasons why they charge the same in dollars as pounds:
1. It's more expensive to sell things over here because we have VAT and the Americans have a lesser 'sales tax'.
2. It's more expensive to sell things over here because living expenses are higher - shop assistants get paid more because their rent and food is more expensive. In America, they get paid less than we do because their living costs are less.
The most important one...
3. People will pay more. If you have a pair of UV400 sunglasses from ASDA that were identical to your oakleys, you'd still want the Oakleys, you're buying the label. If you want to drive the price down, don't buy them.
This comes down to the fact that the UK is more expensive. We could go into the economics of why that is but the biggies are: overpopulation, socialist culture, service industry.
Dwain's on ropey ground complaining about the price of Oakley's, as he's previously proudly admitted that he will happily pay more for labels.
As Rob said, you don't need them...Boots do a cheap sports brand for about 10% of the cost. Oakleys are higher quality kit, however I doubt you'd notice the optical/strength differences in day-to-day use, so I guess that big "O" on the side costs a lotta money...
Absolutely, Pete. The RAF requires us to wear glasses that are UV400. As long as you ensure that, then there's no difference. Most sunglasses more than £10 are UV400 these days. I got some cheapass ones from Blacks that do the trick. Not as cool as the big O but I destroy things so it's probably wise I didn't.
If the complaint was the difference of prices of bread up north and in the south east, there would be better grounds for complaint.
This isn't a rant about the cost more that companies seem to think they can charge twice as much for a brand in the UK then they do in the US and noone will notice. Yes Rob you can argue ecomies of scale and all that rubbish but in a modern world no one will care about that argument the fact is it can be gotten cheaper in the US all you need is someone to bring it back from the US for you. I do it with clothing. I'd accept a 17.5% mark up on US retail prices but 100% is a bit much.
If I was looking for a cheaper option then Oakleys then thats would be possible, I'm not I'm also not buying a "fashion" brand of glasses such as Prada which are about the same price as Oakleys but nowhere near as good. Boots charge £30.00 for a pair of polarised sunglasses, the advantage of expensive sunglasses is that I won't lose them, the Boots ones I wouldn't care about and hence would be more likely to lose.
I will happily pay more for labels but I tend to buy ones where the quality is better then a "cheap" alternative yes the price isn't neccessarly linear, I can accept to some people it makes no sense.
Rob how does this differ from the price of bread up north and south are you really trying to convince the America is that far away. Infact its just as easy for me to buy something from America as is it from somewhere past Watford perhaps I'm being sensitive to this issue, but my Ipod came from the US only a small saving of about £50 the tshirt I was wearing last nite came from the US it was priced at the same in the UK in pounds as the US in Dollars so thats a 50% saving.
Are we so stupid in the UK that we'll pay 100% more for goods then in the US?
But you're not paying 100% more for them. You're getting them for £145 (at which they were freely available online), against a USA cost of $250, which is about £125. So about £20 (or 16% more), which probably covers shipping from the States, and increased tax over here. In fact, thats actually a little cheaper than I'd expect.
As far as I can work out, the only rant here is that your optician tried to do a big markup on you, and you realised. So if you're ranting that "retail will try and charge you more if they think they can get away with it"...well, yes, yes they will. This is hardly rocket science, its simple profit margins...
And yes you are buying a fashion brand...they are fucking "lets appear in every film under the bloody sun" Oakleys. I'm even worse, I have some Ducati Oakleys...I happily paid £15 extra for a red "O" and a small etching on the lense, all because I liked them. I, the person who hates branding, paid more for a brand name. That makes me a gullable arsehole I agree, however I like them, I think they suit me, and as a result I look after them and get plenty of use out of them.
As a little finale...
Methinks your justification has a fatal flaw... You may be better off admitting that you want a pair of Oakleys for no other reason than that they are Oakleys, and just accept that you are going to pay a premium on owning them...
Erm I don't want to get onto how I lost my old pair I know where they were before someone moved out of my flat and they magically vanished when said person moved out. They were there in the morning and gone in the afternoon.
Imagine I grow apples in England and you grow them in America. The Apples grow in the same way in England as they do in America. At each point we look for the cheapest option to get our product to the consumer.
In England, it costs me 4p per apple to pick them. That's because the minimum wage and the speed of apple picking means that I can't pay the person who picks them any less. The minimum wage is set using a price index, working out how expensive it is to live in England.
In America, it costs you 3c per apple to pick them. That's because the minimum wage is less in America because living costs are less.
In England, it costs me 3p per apple to transport them to sale. Fuel costs are high and the driver of the van's salary is quite a lot because his living costs are high.
In America, it costs you 2c per apple to transport them to sale. Fuel costs are lower and the driver doesn't need a high salary to have a comfortable standard of living.
In England, I add a margin onto the apple. It needs to be high because I get taxed on profit and then I need to pay myself, which also gets income taxed. So, I'm going to add 3p onto the cost. The apple costs 10p now.
In America, you don't need to add as much margin because taxes are lower, there are subsidies and you living costs are less. You add 2c. The apple costs 7c.
In England, the shop that sells the apple pays me 10p per apple. Council Rates need paying (1p) and the cost of the staff (2p). That makes 13p per apple. They need to add a profit margin so they can expand their business, say a small one of 2p. Now add VAT (17.5%, rounds up to 3p) and you get 18p. That's what the consumer pays.
In America, the shop that buys your apple pays you 7c for the apple. Rates are less and there isn't much tax. Altogether, he pays only 2c including staff. That makes 9c per apple. He then adds a margin (say a 30%) 3c, making 12c and then 8% tax (1c), so the consumer pays 13c.
International traveller looks at the exchange rate of 2$ = £1 (it isn't but let's say it is) and see that the English apple actually costs 36c! That seems like a lot but then all of the English people are being paid 8c to pick the apple, rather than 3c. 36c doesn't seem a lot to people in England because everything is more expensive.
The mistake the international traveller is making is directly comparing local markets with global markets. Consumer goods normally operate on local markets, not global ones. England is a local market but even here, there are price differences between north and south purely because of living costs being different.
By using the internet, you have the chance to shop in a completely different market, which is nice. However customs and excise will try and charge me (living in England) the VAT for the product I purchased. Still won't come up to the same high price but it will cost more.
To take it one step further, think of the horror of the Chinese villager who see that apples cost 10 times the amount in the US! They don't have access to another other market than their own and you don't have direct access to the Chinese market. If all markets were to become global then the prices will level out but that's not going to happen in our lifetimes and disparity of prices will still occur.
In the case of your Oakleys, it's part greed on the shop owner (although it will be difficult to set reasonable margins on the shop store no doubt) and just global economics. It's all about what money is worth and thus the cost of living. It's more expensive over here because we live in a socialist state.
If you need any more global economics lessons, I recommend you buy a good book.
Rob its all very well comparing sunglasses to appples and its fine if I was moaning about food prices which I'm not. But the Oakleys are made in the same place by workers paid the same ammount, or I'd assume thats how it works I doubt they have manufacturing in the UK and USA I'd guess they'd be made in China or at least all made in the same place.
I can accept that apples are more expensive due to more expensive production and distribution costs however that arguement doesn't hold true for a product like sunglasses or more importantly for a t-shirt. Some people may remember that Gap had a problem when they tried to price goods at the same price in Euros and they did in Pounds people stopped shopping there. As a consumer I'm voting with my credit card by having people bring back clothes and the like from the US.
Are you saying I'm wrong to be pissed of when I know something is the same price in Dollars and it is in Pounds? Should I just accept its the price I pay for living in the most expensive country in Europe? Are you saying that you think its acceptable?
For example http://www.abercrombie.co.uk/webapp/wcs/stores/servlet/product_12406_109... I got a pair of these from the US for $90.
...sigh...
1) Oakleys are made in the USA. Not China. Not UK, just USA.
2) YOU'RE NOT REALLY PAYING MUCH MORE! (see above, 16%, which is more than covered by tax/shipping costs)
3) Yes. Accept it. You're buying a luxury good, they can charge whatever the hell they want. If its too much then don't get it, or pay for a plane ticket to somewhere where they are cheaper.
Or, go live somewhere else if it rankles you so much that designer items are more expensive, mainly because the designers believe they can get away with it, and your optician thought he could get away with a monster markup, when the same item was available much lower from another source.
I wouldn't compare Oakleys with food produce, simply because one is a requirement (food), and the other is purely for ego (designer goods).
This entire thing reminds me very much of the book "Jurassic Park". Right at the start John Hammond (or Richard Attenborough if you've only ever done the film) explains that if you really want to make money you don't go for stuff people need, like medicine, as then you end up getting regulated/restricted costings by government/law. You go for luxury items (such as in his case theme parks), because then you can charge what the hell you want, and people can't complain as if they can't afford it, then quite simply they don't get the treat. No regulation/price-capping, as there is no actual need for the product.
This is identical. You don't need designer sunglasses. You just want them, and as such Oakley will attempt to milk as much money out of you as possible. Your optician got in on the act as well, and by the sounds of it very nearly got away with it too...
Grief! I was simply demonstrating the compound effects of tax when living in an expensive place. The expense is everywhere, not just your income tax and it means that things do cost more. Everywhere, for every single product. It wasn't about the actual apples, you plum! On top of that, my original comment:
3. People will pay more. If you have a pair of UV400 sunglasses from ASDA that were identical to your oakleys, you'd still want the Oakleys, you're buying the label. If you want to drive the price down, don't buy them.
What is 'acceptable' is subjective. I think it's acceptable to have the choice, which you do. So, yes, it is acceptable. What if the Oakleys were wrong in some way? You'd have to ship them back and wait for them to be returned, rather than going to a shop.
Lastly, stop thinking that £1 = $1 because it just doesn't work like that. Living costs define the value of currency, not the actual number.
[edit] Some evidence: http://www.finfacts.com/costofliving.htm [/edit]
I'm agreeing with Pete at the moment, I'm waiting for a paradigm shift. This doesn't feel right.
As soon as I can engineer a 3rd side to this argument, I'm supporting that instead.
As it is I'm having trouble working out what Dwain's point actually is. It's not "these cost twice as much as in the USA" because they didn't. It may be that "designer good costs more than the manufacturing cost to buy", but the only real answer to that is "yes...well spotted". It could be "my optician tried to rip me off", which again is a "well spotted" sort of thing, hardly anything to be shocked over...
Once I have worked out his side of things, I'll let you know if I'm allowing you to be on my side or not. We'll hold at a confusing and slightly suspicious truce for now :-D
The oakley's were a bad example of of somthing costing the same in dollars as they do in pounds the A&F one is much better. My problem is companies charging £90 for something in the UK and $90 in the US.
Doesn't really make much odds. As soon as you buy designer you waive the right to fair pricing... You pay for the label, not the goods. It's upto the manufacturer and retailer to pick a price that they can get away with. And while people buy for the label, they will...
I'd never buy clothing online, as different companies have different measuring systems, and I need to try stuff on. Also, see Robs well structued "Apple Market Theory" for why £1 != $2.
Ah, his problem is with a global economy and an intrisict lack of understand of money markets and the value of currency. I tried to explain it with apples but failed. Imagine you sell rocks...
Dwain, just pretend that America doesn't exist and you'll be much happier. That how some governments deal with global markets, by completely ignoring them. - Which is really scarey if you happen to live there and find out that your government has put massive tarrifs on imports to stop foreign goods because it complicates everything.
Ah yes the Zimbabwe solution, screw you the rest of the world.
I think you just tried to call me an idiot Rob? Clearly you and Pete understand this far better then I do but that’s okay cos your both superior and I accept that. If only I could mastabate as frequently as you and Pete I could be in your club. :P
Honestly, I thought Rob's example was just because it's traditional for any difference of opinion on lack-of to ultimately end up as an argument about Apples.
LOL! NICE.
*grumble* It wasn't about the fucking apples, ok? *grumble*
OK, you'll have to explain the Zimbabwe thing to me in more detail. How does "some stuff costs more in the UK than the USA" relate to "fixing elections and hyper-inflation"?
Were you watching the news and randomly picking words to type? OK, I'll play along with that...
"Oakley pricing is a lot like running people over with a bulldozer, before being shot by police"
"I hear that the reason A&F clothing is more expensive in the UK is because Prince William recently captured $40 million worth of jeans in a speedboat in the West Indies..."
I was thinking of SE Asia / Some bits of South America, not really Zimbabwe. African economics is a different kettle of fish outside of my knowledge.
If anyone is going to America can they bring me back some of those cheap apples please.
Buy an apple? Never. They are nothing but glossy versions of the real thing. They have a wide variety of colourful skins, but when it comes down to it, they are limited in their sugary goodness. They are all about form over function. If I want a real hit of sugar in a fruit, then an orange is by far the better option.
Yes an orange might be more difficult to get into, but I find that level of technical knowledge required to use a knife properly keeps out all the ponces in their roll neck jumpers that can't eat them. Sure an orange requires a thick skin to repel infection, but then who want's to contaminate an apple in the first place.
Yes oranges FTW, at least you don't have the bitter core to deal with afterwards. With those cyanide pips.... They don't mention that in the adverts do they!
Yeah, thanks a bunch Baron; I just had to explain why I suddenly cracked up laughing in a quiet office.
Rob, why are you try to sell us American Cyanide Fruit of Death?
It's lucky Baron stepped in and thwarted your Machiavellian scheme.
The thing is, I actually agree with Gid about the 1:1 dollar/pound conversion being unfair.
Yeah I get the whole, "The costs are cheaper in the US than in the UK". Especially for things like home grown/produced stuff like food. I also get the "It's a luxury item, get over it" thoughts put forward by Pete, but still Gid has a valid point.
I would mention that although the cost of living is cheaper in the US than the UK. The people buying luxury items in the US tend to be paid more than those in the UK. Before the slide of the dollar, a chemist of comparible level to me could earn more than double the numeric value of my salary. To the extent that even with the slide of the dollar they earn more than me. Now maybe this is not true for all professions, but anecdotal evidence coupled with harsh numbers leads me to think it's representative. So we have the people that buy luxury items able to do so more easily in the US than in the UK.
Luxury designer items only? Electronics of all kinds, both utility and luxury suffer from this price inflation. I'm sure that there are more examples, but I can't be bothered to hunt them down.
It still leaves that fact, that an item sold in the US, made in the same place and indentical to one sold in the UK, will be the same numeric value in $ in the US as it is in £ in the UK.
Differences in costs for retailers and transportation costs in the UK will probably account for some of that disparity, but 100% difference? I think not.
Yeah there is a certain amount of what the retailer can get away with. Supply and demand and all that jazz. Doesn't mean Gid can't have a good old whinge about it though. Nor that a larger and larger proportion of the buying public are getting fed up of it. But then supply and demand may well sort that out as purchasing becomes more and more global.
Individual industries, particularly specialised ones are not representative of an economy as a whole. Interesting that chemists are paid more over there, I'd suggest that it's because there are fewer graduates and more jobs. The average wage in the USA was $36,764. In the Uk it's £22,000.
Everything you mention is still explained with the apples example. Whinge about it all you like, it's global economics and it still stands as the best system so far. If you think it's not fair then you're missing the point. It's not about fair, money markets, and the value of currency are not fair, they destroy economies. They're emergent: they are not controlled by anyone but are the biproduct of hundred of complex economic systems.
Let me try another tack.
You're saying that it's bad that Price $ = Price £
That's because $10 actually equals £5 but we have to pay £10.
However, American gross salary is $36,764. By the same token, that's only £18,382. The UK salary is 22,000 on average.
That's not all! It costs less to live over there too. So the amount of disposable income is greater! So, in the UK, people spend less on 'stuff'. But then Americans spend more on insurance... it goes on and on...
My point is that it is VERY COMPLICATED and they are LOCAL markets. You can't just compare the price of sunglasses in two places and say it's unfair. The manufacturer will say that they are selling to two different markets. They can charge the UK market more because (I'm repeating myself here):
1. We will pay more.
2. It costs them more to sell to our shitty tiny market of only 60 million consumers.
They will decide how many units they want to sell and select a price point that will satisfy that. The cheaper, the more they sell, the more expensive, the less they sell. That's not even going into market perception - if it's expensive, it's exclusive and the brand is made more prestigious.
I'd say the bigger complaint is pharma companies selling drugs to Africa - should they be dirt cheap or should they pay for the research like everyone else? They're third world, so should be third world prices but then people will import them back into Europe to undersell the Europe market...
Which brings me neatly onto the argument of why pure globalisation won't work: because companies CAN charge UK loads and the US less and get away with it. Totally legal. They will then sell in China for much less. Companies will stop you exporting without their permission like they did with DVDs.