Where to cash in on the strong Aussie dollar

TimB says:

08:34am | 18/10/10

That’s a fair point Macca, and one that was raised in response to Zumbo’s article a couple of weeks back. However surely there should be some sort of delayed effect that comes through?

Otherwise it’s simply a case of “we need to keep our prices this high for when the currency is down, but when it’s up we’re just going to gouge you”.
And given the size of the price differences involved, you can’t write it all off to simple hedging on currency rates. Retailers do appear to be taking advantage.

Surely there’s a middle ground solution where every few months they can review prices against some sort of average expected currency rate for the upcoming period.

Macca says:

09:40am | 18/10/10

@TimB, Considering the sales we are seeing in department, home and electronic stores, I don’t think anyone in retail is doing well right now. I bought a top-end Sony 32’’ plasma on June 30 thinking I was getting a bargain on the end of year sales. That same TV is now 20 - 30% cheaper on sale still. I could buy the 42’’ for nearly the same price now and I’d get a PS3 thrown in.

Right now, the Aussie Dollar is bad for retailers because they have all this product which they purchased 6 months ago which is now 25% over valued. Things are looking good for the future, but you still have to shift they inventory to make any money, which if you are domestic, is ok. But if you are an international distributor or manufcaturer, you are in real strife.

Whilst I can see your point, I don’t know that we’ll see many instances where retail growth does really well after a period of the Australian Dollar falling. Still, if this did occur, I would agree with you that the retailers would milk it for all that it is worth.

Jenni says:

11:59am | 18/10/10

@Macca - I would have more empathy for this argument if any of the large retailers waited before *raising* their prices, but they don’t. They might have bought their stock at a cheaper price, but they’re still charge you the markup on whatever the current cost is.

It works both ways, all I’m saying.

Seventh says:

03:33pm | 18/10/10

You see, I understand the companies need to keep their margins up and they bought their current stock at a higher price than it is current, but thing is - I really don’t care.
When the dollar was low, I would buy my games and electronics from JB-HiFi because they were cheaper than say, GAME or EB. Now the dollar is high, I’m going to import my games and electronics from overseas as, once again, it’s cheaper to do so.

Dash says:

08:02am | 18/10/10

Hi actotrel, the only issue is that any additional tax as a cost of doing business, will get passed on to the consumer. Just like a tax on carbon will be passed on to the consumer.

And their mark-up is already taxed. We have a flat tax of 30% on corporate profits. The more profit businesses make, the more tax they pay!

If you want to keep prices under control you need demand and competition. It’s simple Keynesian macro ecomonics. Government intervention and socialist styled wealth redistribution is not the answer.

Jim says:

11:02am | 18/10/10

I thought you were the worlds leading expert on EVERYTHING, Badger.

Most of our petrol comes from refineries in SE Asia…as a result the petrol prices follows the Singapore dollar more than the US dollar.

The Badger says:

12:41pm | 18/10/10

Not everything Jim

If I’m looking for information about animal droppings or the union movement in Australia, I’ll defer to you.
you might also be a useful source of information regarding why flies pop in and out of nostrils with no apparent ill effect on your expression.

As a general rule, for every one cent the Australian dollar improves against the US dollar, the price of petrol should drop 1 cent at the bowser.

This may affect you 1,800 per month electricity bill. Be prepared and expect crackdowns.

Jim says:

01:09pm | 18/10/10

As a general rule, for every one cent the Australian dollar improves against the US dollar, the price of petrol should drop 1 cent at the bowser.” - no.
This is a false correlation and only true when the Singapore dollar trends differently to the AUD vs the USD.
Try looking at http://www.aip.com.au/pricing/facts/Facts_about_Petrol_Prices_and_the_Australian_Fuel_Market.htm esp the bit about wholesale prices.

TimB says:

09:04am | 18/10/10

Unfortunately Macca, yes that is how the Left sees the economy.

“Look there’s someone making money! What additional tax should we hti them with?”

Doesn’t matter if they’re already being taxed. The point is someone, somewhere is becoming wealthy and that’s a big no-no in the eyes of the Left. Everyone should be equally poor.

TimB says:

09:29am | 18/10/10

Doesn’t work for anything with a territory lockout though.

I Import DS games all the time, but I think I’m going to be forced to stop when the 3DS releases. Plus I’ll no doubt be gouged on the hardware itself too. *sigh*

Macca says:

10:03am | 18/10/10

@happygamer, thats me with f1 2010 at the moment, a race weekend takes an hour at least. Needless to say there are not enough hours in a day right now. Lord knows how I’m going to cope when Football Manager 2011 comes out at the end of the month.

Nate says:

02:28pm | 20/10/10

I agree, some of the games I buy are only $29.99 USD in the US and $99.95 AUD here. And this even applies to the ones delivered digitally where they have absolutely no excuse for the increase in prices. I can understand a $29.99 USD game selling for say $39.99 AUD here due to taxes, differences in employee wages etc. But when it costs twice as much or more then it’s clearly a huge rip-off. Especially for new games because there is no way that they bought those games from their source at the old exchange rates.

Dash says:

09:56am | 18/10/10

Dino, the Rudd government promised us “cheaper books for all Australians”. Unfortunately that promise went the same way as “cheaper better childcare” , “more affordable housing” , “root and branch tax reform”, “grocery choice”, “Fuelwatch” and “there will be no carbon tax”.

Aaron says:

10:45am | 18/10/10

How does that work when the GBP and EUR are both valued at around 1 = $AUD1.50? Unless of course you mean that it has gone down from $AUD1.62.

Chewy says:

10:56am | 18/10/10

We get consumers demanding warranty on purchases made from the US online because we are the ‘Australian distributor’. Ditto for people who want technical help. It cracks me up the gall of some people..

PacMan says:

11:18am | 18/10/10

I can buy two of said game for the price of one over here so it still works out cheaper and with the amount you save you can take the product to a repairer and still come out better off.

Dash says:

03:58pm | 18/10/10

MF, the last work trip I did to NYC earlier in the year, I was amazed at the prices in the US. I bought a camera lense $400 cheaper than it would have cost me here. And I bought a pair of shoes for US$35 which are selling for AUS$90 in Sydney. How is that justified when they come out of the same Chinese factory? Levis are almost half the price. And don’t get me started on motor cars! The Pontiac G8 GT which is the Holden Commodore SSV V8, sells for under US$30K compared to A$60K here! So it’s built in Australia and shipped to the US and they still sell it for half the price!!!!!!!!!

nate says:

02:35pm | 20/10/10

While for some items that may be true, for most items, it’s false. All the stuff that I bought from overseas (Asia, US or UK) are at most 75% of the Oz price when shipping is included. Some are as low as 45% when shipping is included. And I’ve bought many different things from clothes to boardgames to books to electronics etc.

Of course you wait longer for it to get here but for that price I don’t really mind.