Aussie Dollar Strong. Aussie sellers weak.

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Aussie Dollar Strong. Aussie sellers weak.

Postby Mickstape » Tue Nov 30, 2010 4:27 pm

Hi T'Rockers.

I wanted to ask you all what you think about Australian Pro Audio suppliers not wanting to match the Yank dollar. :((

I've been forced into importing gear from the states due to local shops and suppliers not wanting to even match the prices that O/S sellers are offering let alone beat them. I have even been offering to throw the cost of the postage i would have to have paid on top and they still won't play ball.

Now i'm all for keeping my money in country, doing the locals a favour yada yada, but if they are not even going to try, then my money is going elsewhere.

Obviously this is one of those contentious bones that has been picked dry.

The only reason i can see for not wanting to make the sale is because of the ridiculous profit margins they are enjoying by importing for cheap and selling for sometimes up to 300% more than what they paid.

Anyone else having this problem or is it just me?
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby wez » Tue Nov 30, 2010 5:53 pm

retailers are basically fucked. we have a situation where times are tough, but the dollar is good. in other words... none of us have any money so price has become the number one concern.

we no longer sympathise with the hardships of being an importer or retailer in this tiny backwater market. we just want it cheap. we have the internet. we have credit cards. we don't give a shit anymore.

a year or two ago i would've happily waved a placard in defence of the local retailer. and i still hate the thought of mannys or allans or billy hydes or whoever going under. but we have businesses to run and times are tough. the retailers and importers complain about slim margins but F@#$ing hell have you seen the margin on a studio-type business?

the game has changed. it's probably for the worse, but this is the modern international free-trade world we have now. there's no going back.

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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby waitup » Tue Nov 30, 2010 5:54 pm

viewtopic.php?f=1&t=4521

Here's a couple of opinions
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Mickstape » Tue Nov 30, 2010 7:06 pm

Thanks Nick.

I see i'm a little late.

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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby waitup » Tue Nov 30, 2010 7:13 pm

:) Better late than never!
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby musikwerks » Tue Nov 30, 2010 9:31 pm

I know I'm usually all for the grey market but something that should be taken into consideration is the possibility that a lot of retailers purchased stock when the dollar was less than favourable. It's not necessarily a simple matter of matching prices. If they price match at today's exchange rate of, say, .96 cents in the dollar but purchased the stock at .70 cents on the dollar.... they're screwed. Not their fault either.

Just something to consider.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Kurt » Wed Dec 01, 2010 12:36 am

Buying something for the sole purpose of on-selling at a profit is always a gamble, it's the risk you take. Having said that, like was mentioned in the other thread, exchange rate doesn't account for the massive price disparities we see in our corner of the world. I had it from a reliable source a few years ago that a Marshall that retailed at $2400 wholesales for around $800. That's a rort in anyone's books I'm afraid. With a 300% mark-up no-one's losing money when the dollar climbs 20 cents!

I don't expect dollar for dollar price matching but at least being in the same ball park is, I think, a reasonable request.

musikwerks wrote:I know I'm usually all for the grey market but something that should be taken into consideration is the possibility that a lot of retailers purchased stock when the dollar was less than favourable. It's not necessarily a simple matter of matching prices. If they price match at today's exchange rate of, say, .96 cents in the dollar but purchased the stock at .70 cents on the dollar.... they're screwed. Not their fault either.

Just something to consider.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Mickstape » Wed Dec 01, 2010 9:08 am

Kris, thats a backflip on how you were talking in that other thread dude.

Anyway, when retailers accept that they will have to lose out on money coming in, regardless of profit margins, i think we will see a turnaround. But then again, i think that people chasing pro audio only make up 15% of the market share of consumers who purchase from their businesses so maybe things will never change.... I guess if i was a business selling pro audio and the other shit they call pro audio i would be rubbing my hands together at this time of the year, teenagers wanting that Mesa/Roland/Korg/Nord etc, oh yeah watch the bucks roll in they are saying.

And without naming names, well i'll call 2 out, MACRON MUSIC and Muso's Corner you may go to the fiery pit of consumer death, there are certain business' who are continuing to reap the profits.

I bought a deluxe plus roominator kit from the states about three weeks ago, the closest i could get anyone in Australia to the price i paid, which was $849 + 149 postage in yank dollars which was just about equal to ours at the time, was a price drop of 250 bucks, which took their price down from 1899 to 1649. Now what would you do? Exactly. Tell them to stick it. I bought other goodies for the wife n kids with the 600 i saved from not having to spend over here.

Now i appreciate the fact that particular business probably did pay top dollar for their stock when they originally ordered it but they are not going to sell it any faster if they don't try and keep up with the way the buck is at the moment. I went to the same website a few minutes ago and they have in fact dropped the price of the same kit by 300 bucks which means they either took my well meaning but blunt message to heart or they are realising that people are gonna go elsewhere and that stock is just gonna sit and gather dust. And i even found a cheaper aussie website who wants 1200 with free postage, where were you 3 weeks ago?

Either way, until retailers get with it i'm spending my money OS. Sorry but that's the way it is.

That is all.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Thirteen » Wed Dec 01, 2010 9:12 am

Money leaving the Australian economy hurts all of us. Australian businesses closing and leaving their staff jobless means less customers with money to spend, which effects every other business in Australia, including recording studios and whatever jobs you Turtlerockers have. No customers, no business, and it has a domino effect. The guys that lose their jobs at the music/camera/hifi/jewellery/whatever shops stop spending at the local cafe and food shops, stop buying gear or renting studios themselves, and on it goes. Everyone suffers.

Can I also mention that In the US and Canada, they don't have penalty rates, they don't have 4 weeks paid holiday, and they don't have anywhere near the worker entitlements that we do. They also don't have a crippling property bubble with extreme commercial rents like we do, and they have a massive customer base, which we don't. Sounds to me like a lot of you guys have no idea how expensive it is to open a retail store and to employ Australian staff.

There is a bigger picture.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby musikwerks » Wed Dec 01, 2010 9:57 am

Not backflipping.... I will always buy the best deal, regardless of where it comes from. The best deal does is not just the best price. Things like service, warranty etc do factor in my decision. With most items though I am happy to "risk" the o/s purchase.

But re: my previous post, yes some retailers gouge but not all and the fluctuating dollar needs to be taken in to account before crucifying *every* retailer.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Dallas » Wed Dec 01, 2010 10:29 am

Hypothetical scenario......

Cashed up audio entrepeneur builds studio (or two or three) in Bali (something like the Misner resort in Byron) - assume the equipment, sound & expertise is equal to what is available in Australia - then assume that thier pricing will be dramatically lower than what it costs for the same service in Oz (even with airfare & accomodation) - are all you ebay kings gonna work for half a banana because someone in indonesia will do the same job at that price??

Think it can't happen?? How much orchestral stuff is being recorded in Hungary etc because former eastern bloc musos work way cheaper than their western counterparts??
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Kurt » Wed Dec 01, 2010 10:49 am

I'm sure there are already some very good studios in Indonesia but I've never heard of anyone going there to record. On the other hand I know of several Australian bands who've gone to the USA to record, even though it cost more than doing it locally. People are happy to pay top dollar for a service if they perceive value in it. People are seeing less value in the service of importing goods when in this day and age it's quite simple to do it yourself.

Dallas wrote:Hypothetical scenario......

Cashed up audio entrepeneur builds studio (or two or three) in Bali (something like the Misner resort in Byron) - assume the equipment, sound & expertise is equal to what is available in Australia - then assume that thier pricing will be dramatically lower than what it costs for the same service in Oz (even with airfare & accomodation) - are all you ebay kings gonna work for half a banana because someone in indonesia will do the same job at that price??

Think it can't happen?? How much orchestral stuff is being recorded in Hungary etc because former eastern bloc musos work way cheaper than their western counterparts??
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby headman » Wed Dec 01, 2010 11:12 am

Well just about everything I own was NOT bought at a retail shop. None of these business' sell the instruments or studio gear that I use. I troll second hand stores and Ebay (and the Turtlerock Forum) for the gear I want. Having said that I have an account at Muso's Corner in Newcastle for consumables and bits and bobs, and I wouldn't like to be paying their wages and insurance bills at all. It's a money pit, any type of business, these days, and no one makes a quid out of tight arses like us, we are not the bread and butter of the music retail business.

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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby musikwerks » Wed Dec 01, 2010 11:24 am

Dallas... as an example....

I make TV and film type stuff. I am slowly starting to get into 3D/Stereoscopic content.

Now, I could do all my online editing and colour grading in Australia or... I could take it to Wellington, New Zealand and get the same gear and service at almost 40% less.

Dollar for dollar I can "buy" the same service... Aussie prices are pretty much the same as NZ prices... but the NZ dollar is always between 20%-30% down on the Aussie and there is no GST payable so I could save anywhere between 20 to 40%! Extra benefit is that on one day their staff may be working on my job and tomorrow they are working on The Hobbit. When putting that in the context of a $120,000aud per hour long episode program, it makes a HUGE difference.

Offshore everything is a fact of life. We can either embrace it and make it work for us or it will be the end of many. If the mouse gets smart you have to build a better trap.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby rick » Wed Dec 01, 2010 2:01 pm

just as a whatso ...

more then 30 maybe 40 percent of my current work comes from overseas ,
probably right out of the client list of one major US mastering house if we are straight up about it .
the only reasons i can think of is am cheaper and still doing the same level work ( in that order as well i reckon )

the closer we come to pipping the us dollar the more interesting things will get on that front .. but i will live

3 years ago when the dollar was different i use to do a job from china a week
the last year nothing ...

you just have to keep mining for your clients where ever in the world they might be - thats the way it is

yeah i reckon the local retailers are hurting .. oh well the rest of the world is too
no point moaning about it - time to adapt for some of them , dissapear for others.

there will always be somebody ready to pony up and try and do it better then the last guy
more power to THAT guy
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Ausrock » Wed Dec 01, 2010 5:36 pm

Mickstape wrote:And without naming names, well i'll call 2 out, MACRON MUSIC and Muso's Corner you may go to the fiery pit of consumer death, there are certain business' who are continuing to reap the profits.


You mustn't have been trying at Musos. Like Headman said, businesses like that are damned expensive to operate..........the fact that that particular business has survived for decades (including both fire and floods in the past five years) and in the past won Aust., music retailer awards means they've got to be doing something right.

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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby The Tasmanian » Wed Dec 01, 2010 10:17 pm

I think it s really important before we slag off our retailers that we understand the situation may be different than what we perceive - for many reasons: tax,Aussie dollar when the stock was bought, etc etc, we have NO idea.
After running several businesses, I am very careful not to jump to conclusions about their mark up / profit based on my personal observations on ebay etc etc - wherever I get them from!
As Steve Jones informed - these overseas businesses have nowhere near the ongoing employment costs we have here, and the buying power of these Aussie retailers is nowhere near the power of these big US retailers.
In Australia we are all interconnected and we need each other - music retailers/rehearsal studios/ artists/ engineers/producers/mastering engineers/labels.
And on the flip side - if any retailer ignores the real world of online internet pricing/competition then may they be fed to us - the sharks!

When I buy something made overseas I research the price globally - and in Australia, look at the AU$, think about warranty etc etc and make a choice -
BUT I do consider that saving a bit at the expense of supporting a Aussie retailer may mean the retailer may not have enough to pay his employees who may happen to play in a band that may happen to be planning recording at my studio...
Support your good Aussie retailer - and force them to get better!
And i believe there are plenty of good ones that deserve our support to survive.
And if they are not good enough - push them! they will sink or swim just like any other business.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Aearth » Thu Dec 02, 2010 3:51 pm

OK lets start buying Aussie gear, but who and where. The only people I know here in Australia is BeesNeez mics, JLM and Pro-harmonics.
Lets support them for a start never mind the importers.

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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby GlennS » Thu Dec 02, 2010 4:10 pm

Hux is another one. I've been using a Beesneez mic through a Hux preamp a lot lately (with a compressor modified by Proharmonic). Dave Peach has joined forces with Rode & I'm sure we'll be seeing interesting stuff from them in the near future. Are there any Aussie plugins?
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Mickstape » Thu Dec 02, 2010 4:26 pm

Okay, I will just clarify that I'm all for supporting local retailers.

Like a few people have pointed out, they rely on us to keep them afloat.

My issue is that they do not want to even try to get the sale.

When i point out that i can save up to twice the amount of the purchase price by shopping online overseas i would expect them to at least throw me a bone. Especially when i'm waving a wad of cash in their face. Not tell me the best you can do on a 600 dollar item is 50 miserable bucks. While i have three other items that total $1800 as well. And there are 6 of the same item on the shelf waiting for some other sucker.

Look i'm not ready to be outlaying 60k on a console yet, and if i was purchasing something in that price range then i wouldnt be expecting a 50% reduction on the price because i know i can't find that sort of deal anywhere on the planet. But when it's some that is mass produced, and readily available, globally, for that sort of price reduction why shouldn't i ask for the local seller to at least have a go at making the sale?

Having said that I have an account at Muso's Corner in Newcastle for consumables and bits and bobs, and I wouldn't like to be paying their wages and insurance bills at all. It's a money pit, any type of business, these days, and no one makes a quid out of tight arses like us, we are not the bread and butter of the music retail business.


As for operating retail business like these ones, yes i realise there are associated overheads, that if the place you are renting is a money pit then you need those inflated profits from sales but surely there are ways around this. Call me naive but there is always a way isn't there? a fire sale? a end of year tax write off? If you are not going to try then you will end up losing out, and that helps nobody.

You mustn't have been trying at Musos


And yes i did try at Musos Corner, i took three of my mates in there last christmas and collectively we spent over 6k in cash in the one go just on guitars. Plus the other 4 thousand on leads, monitors, mics and accessories etc. Scotty was loving life. Now you can say that 10k cash is a pittance when you talk about gear but for 3 blokes who hadn't ever spent over 500 bucks on gear from anywhere but Macron or those other consumer crap traps it was a lot of coin. I had to persuade them they were getting a good deal, which they did, some of the stuff they got 30% off on due to the amount of coin they were spending. Hard earned sweaty coin. But in reality the saving was just 30% of the profit they <musos corner> were making so really there wasn't a significant saving at all. So this year i've told them to import, and they are doing that.

Money leaving the Australian economy hurts all of us. Australian businesses closing and leaving their staff jobless means less customers with money to spend, which effects every other business in Australia, including recording studios and whatever jobs you Turtlerockers have. No customers, no business, and it has a domino effect. The guys that lose their jobs at the music/camera/hifi/jewellery/whatever shops stop spending at the local cafe and food shops, stop buying gear or renting studios themselves, and on it goes. Everyone suffers.


The way I see it, now that we have parity of the dollar I would expect retailers to want the sales, not turn them away. What kind of businessman/woman would turn away cash sales because the profit margin they will make will only be 1/3rd of what they would have made 6/12/18 months ago? Not me man. I want that old stock out the door so i can buy more at even cheaper prices. It's not my problem Westfield/Joe Bloggs etc is charging you excessive rent. Or that the wholesale mob who has a stranglehold over the imports is not playing ball with the prices of stock. Why punish me? I am a customer who wants to spend my money with your business rather than give it to some yank who i will never be able to have a face to face with to try and get a little bit better of a deal for my dollar.

I don't know about you lot but like i said before, until i have to start spending my money here again my buck is going where it suits me most, and that is in my back pocket or in my bank account. I went so beserk spending money lately overseas my missus has put me on a permanent ban on buying stuff till after christmas, F*ck i'm on a 24/7/365 ban! and she's making me sell stuff i don't use everyday to cover HER expenses :(( In fact the only place in Aus i have spent coin at recently was at Pony today for a Voxguard Screen, and that's for her. I can't convince her that it's gear that i will need one day, to her it's just gear. And thats it.

Thank the heavens for the sneaky TAB and Paypal account eh.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Aearth » Thu Dec 02, 2010 4:39 pm

GlennS wrote:Hux is another one. I've been using a Beesneez mic through a Hux preamp a lot lately (with a compressor modified by Proharmonic). Dave Peach has joined forces with Rode & I'm sure we'll be seeing interesting stuff from them in the near future. Are there any Aussie plugins?

Peach with Rode now that would be interesting.

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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Kurt » Thu Dec 02, 2010 4:51 pm

30% off the price is not a 30% cut in profit.

I don't think any business should be forced into fire sales or tax write offs so I (or you) can save some money. The whole idea behind them is that the prices are so low the business is losing money to cover an unforeseen cost. I sure as shit don't like losing money and can't do it sustainably!

I object to blatant profiteering or gouging, I understand that some expenses may be higher here than elsewhere and this can result in somewhat higher retail prices than overseas. But seriously, if I can buy from a retailer in the USA and land it here substantially cheaper than the local guy can provide it, sorry local guy.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby headman » Fri Dec 03, 2010 9:00 am

"30% off the price is not a 30% cut in profit."

Exactly, sometimes a 30% off the price is a 100% cut in profit. Who would be a retailer these days?

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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Dallas » Fri Dec 03, 2010 11:54 am

Hey - the minimum wage in Australia is $15 per hour!! How dare these recording studios rip off unsuspecting musos by charging more than that!!! :-?
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Dallas » Fri Dec 03, 2010 12:05 pm

headman wrote:"30% off the price is not a 30% cut in profit."

Exactly, sometimes a 30% off the price is a 100% cut in profit. Who would be a retailer these days?

headman


I get customers bitching to me all the time - "why don't you have xxx-brand high end guitar in stock??" - these seems to be the same customers that can also "get them off ebay for half that price".... where I work we carry very few top end guitars because we make more profit from selling a $299 beginner pack than we do selling a US Strat (after matching prices with every other retailer in the world)
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Mickstape » Fri Dec 03, 2010 12:11 pm

Just off hand Mr Head, are you a retailer? I take it that you work in retail, Dallas, by your recent post.

I have no further comment on this issue but the way you put things it seems like you are taking it as a slight against retailers in general.

It's not my intention to piss anyone off with my opinions

So please don't think i'm bitching and moaning about prices, you get what you pay for, sometimes you just save a lot more by shopping for the same item elsewhere.

I'd like to see some sort of progress in the competitive market here is all.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Dallas » Fri Dec 03, 2010 1:01 pm

Mickstape wrote:I'd like to see some sort of progress in the competitive market here is all.


A bit more reasonable than some of your other comments.....

Yes, I work in retail (instruments, small PA & home recording) - I drive a tarago, not a mercedes.... and I can guarantee you there isn't a retailer in Australia that's making more than 30% profit on anything - and the higher the price of an item the less percentage profit they're making. As for having a "Fire Sale" to cover retail rental - it's kinda hard to pay your rent WHEN YOU DON'T MAKE A PROFIT on what you sell.

As for wholesalers, haven't been one, haven't worked for one, so don't know what's going on in their world - I do know however that in general an Aussie importer bringing in US gear is generally buying at the same price as the US retailers (& paying up-front!!) We get people all the time suggesting we should be buying stuff off US retailers to sell - ok, I'll just reach into my moneypot of unlimited credit.... oh, and bring them in one at a time to avoid gst!

So what are your rates Mick??? I know if I'm out either playing or live mixing I'm not leaving home for less than $150.... more if I'm providing PA or loading in & out. I'm sure you're working for similar rates. How do either of us justify making such an exorbitant "profit" over minimum wage when we have no cost outlay (my gear's fully paid for, by the sound of it yours is too) - that's what shits me, the attitude of "I'm allowed to make a profit but f@#$ the retailers, why can't they live on the breadline??"

If retail's a licence to print money, why aren't you doing it???
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Dallas » Fri Dec 03, 2010 1:04 pm

Mickstape wrote:I'd like to see some sort of progress in the competitive market here is all.


Some good news for you on this front - the latest thing is for wholesalers to lower retail prices to bring them inline with overseas pricing!! The sting in the tail is retail margin on this drops to 25% for the examples I've seen so far
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby Mickstape » Fri Dec 03, 2010 1:40 pm

So what are your rates Mick??? I know if I'm out either playing or live mixing I'm not leaving home for less than $150.... more if I'm providing PA or loading in & out. I'm sure you're working for similar rates. How do either of us justify making such an exorbitant "profit" over minimum wage when we have no cost outlay (my gear's fully paid for, by the sound of it yours is too) - that's what shits me, the attitude of "I'm allowed to make a profit but f@#$ the retailers, why can't they live on the breadline??"


Not all of my gear is fully paid up Dallas, and i do not like to even consider the work unless the money is above the figure you quoted. As for justification well the gear was expensive, and apparently i am worth the money i charge. I am yet to make a profit of the audio game man, i will soon i am sure of it but like you i factor in all my expenses for the job and charge accordingly. And i don't have that attitude of "I'm allowed to make a profit but f@#$ the retailers, why can't they live on the breadline??", i just like to know i'm getting my moneys worth.

I wasn't always in Audio dude, i F@#$ing SLAVED as a roof tiler and contractor to be able to get to the point where i could take a decent stab at trying something else while being able to still live off the money i earned over 14 years of horrible horrible work while i changed career. So maybe all those years of being fucked over by retailers like Harvey Norman/JB HiFi/Insert large chain here X( and trying to get the most for my dollar has resulted in me being a little unfair on retailers in the Audio game. And to be honest i still have to get my hands dirty occasionally. Not that i mind having to do it.

I guess not having the experience of being a retail business owner is not serving my argument any good. But i do know what it is like to run a small business.I also realise that the stress of being a retailer in todays market and economy probably is not the best of businesses at the moment, what with customers like myself taking my money overseas and bagging the shit out of local sellers for not being competitive enough i would be a little upset also.

I dunno man, i appreciate what you have to say, don't get me wrong, but i'm still sceptical of what retailers say their profit margins are and what they really are.
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Re: Aussie Dollar Strong. Aussie sellers weak.

Postby heathen » Fri Dec 03, 2010 7:48 pm

Everyone's making valid points, the real problem is everything is over-inflated in Aus, rent, food, power, petrol ......................... everything. Dropping the $1000 limit would benefit local retailers but disadvantage all the savvy shoppers who know they are being ripped blind here by some retailers. It would be almost unenforceable except to bring back tarrifs on everything.

The free trade agreement has destroyed quite a few farmers businesses and forced people from their land who have farmed for generations. All imported produce should have tarrifs brought back, but hell if it is'nt manufactured or grown here we have to import, so that should be duty free up to the $1000 mark as it is now.

I've made deals with local retailers when buying high end gear and some will almost match the USA price and even tell you how much they are making. These guys are worth dealing with, some others are not. As Kris said too there is always a flow on effect from when the dollar was low to where it is now, takes a while for prices to flow on.

Also I'm sick of getting 2nd class food when we pay a premium, China decides to crack down on lobster smuggling and all of a sudden lobster will be cheaper than ever. We get charged top dollar for the crap they can't sell overseas.

Anyway seems there is more to trade agreements than meets the eye.
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