The Great South African RIP OFF!!

J

jamieb

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Hi Everyone

It's amazing how prices for electronics (among other things) are so much higher in South Africa than other parts of the world.

I'm in the market for an HP Laserjet 3030 All-In-One Printer.

Best Price in the USA: $345 = R 2,112.50*
Best Price in South Africa: R 4,439.00 (Digital Planet)

*Exchange Rate of 6.12319 ZAR to USD

This amount to a 110.18% markup. Its not like we South Africans have bucket loads of extra cash lying around???

This is just one example of thousands of products that are marked up by ludicrous amounts!!! Something MUST BE DONE ABOUT THIS.

I had an interesting conversation with this guy who runs a printer repair shop (the same guy who quoted me R5328 for the same printer above).

Apparently, the SA government has legislation in effect to prevent companies such as HP from selling direct to the public.

There are like three levels of markup here locally before it hits the consumer. Who pays? THE CONSUMER.

Thoughts on this??
 
I have a similar gripe with electronics, also computer related.

Computer case mods: Buying from xoxide.com directly is a lot cheaper than buying from local companies. Unfortunately xoxide.com refuses to ship to South Africa. How on earth is it possible to charge more than double what the americans charge? Do SA companies import goods with canoos?

Erm, this is just another reason, other than Telkom, why its better to NOT live in SA. Anywhere but here.
 
idea

Its madness!! We are supposed to all live in a Globalised World... and yet we CONTINUE to have to put up with this draconian bullsh*t.
 
To put your HP price into perspective:

Rectron charges R3595 ex vat (R4098.30 inc vat)

IOW Dig Planet makes R340.70 profit. Thats not too bad, being not even 10% markup. So the problem might be the suppliers. How come they charge so much? It seems that all electronic equipment is MUCH cheaper in America, even though America also has most things "Made in JAPAN" or somesuch place.
 
I know, it irritates the hell out of me. For example, if i want to buy something uncommon, like a brand name car audio amplifier, it'll cost almost 3 times more in SA than the US. I feel we are seriously ripped off. Why is it necessary to have "3 levels of markup" as you say? We just need an importer with a web portal and we'd be happy. I think import tax is a HUGE component of this extra cost to "protect the local markets". When did SA start making printers and amps i ask....
 
lol, there was a gfx card on take2.co.za one time, comes with its own leather case and a few other things - cost just under R6,600, in the states - around $500.. and take2 is cheap, so the suppliers musta been creaming it royally.
 
Mac-Mini, low end spec :-

In the US, retail cost = $499
In South Africa retail cost = R4,559.00

Lets take the exchange rate at 5.7, meaning the US retail is R2844

That's a R1754 difference !

You can't tell me shipping per unit is anymore than R100 when you ship in bulk along with other products - cmon, these guys fill up huge containers filled with all sorts of different stuff, plus the ipod mini is small and very light.

Ok, then the distributor passes onto ZA Store - how much do they put on top of that ?
Maybe ZA Store themselves ship the goods over and that's even worse !
 
Not that it makes *much* difference, but remember that there is a 6.5% import duty on computer hardware, plus the obligatory 14% VAT...
 
On the prices I quoted, the VAT is already included.
I thought computer hardware was exempt from import duties ?
If not, then import duty on $499 is $32
 
no doubt, because the volumes are lower in SA, the price is likely to be marked up an extra 15%.

how do we account for the rest of that huge markup?
 
jamieb said:
Apparently, the SA government has legislation in effect to prevent companies such as HP from selling direct to the public.
Click to expand...
No not true, Both HP & Dell sell direct to the public, it's more a case of business model and cost of distribution, warehousing, etc.
http://www.hpshop.co.za/shop/levels.asp?intStockLevelID=14

Yes although you quote dollar prices, remember most of SA retailers do not purchase in large enough quantities (low volume of sales) to be able to negotiate better prices as per their counterparts in USA. This means they start with a higher retail price onto which they add cost from import and taxation and finally their margin... Yes this final price sucks in comparison with USA prices... But hey it is SA... If you want to complain then just look at our car prices, now that's highway robbery compared to USA or Japan...

Hey you can always buy online and ship to SA, it sometime works out quite a bit cheaper...
 
TheCynick said:
Not that it makes *much* difference, but remember that there is a 6.5% import duty on computer hardware, plus the obligatory 14% VAT...
Click to expand...

I thought they got rid of this import duty ?
 
arf9999 said:
Actually they did. Most computer hardware is 0 duty rated.
But you still need to pay VAT.
Click to expand...
Yes of course they got rid of it, but it also still cost's money to import these goods (transport, warehouse, etc.)
 
VAT isnt too bad, unfortunately the best computer hardware sites from America do NOT ship to SA. Great. Buggered again. Lets then go buy from Incredible Infection...
 
eye_suc said:
Buggered again. Lets then go buy from Incredible Infection...
Click to expand...
No way, there are many alternatives to them, look around & negotiate...
 
Yes although you quote dollar prices, remember most of SA retailers do not purchase in large enough quantities (low volume of sales) to be able to negotiate better prices as per their counterparts in USA.
Click to expand...

According your argument, what is stopping an SA Retailer buying from a US Retailer at the reduce price and shipping the goods over here, collecting a 100% markup on the goods? As was pointed out earlier, Digital Planet is only collecting a 10% markup on the HP Laserjet. The 90% - vat - shipping costs is still a significant chunk.
 
Stoke opens up an online Rectum equivalent.

Step 1 = Find offshore people willing to do business with SA. Problem, nobody likes shipping to Africa. Solution = Insurance (Credit insurance) which I must pay. Thats 8 - 15% extra cost.
Step 2 = Import the stuff, and pay outrageous insurance on the shipping costs - all this stuff is easily damaged and "accidentally lost", and it's high risk - once again, cos it's Africa.
Step 3 = Now move the stuff out of the container to a warehouse somewhere - now it's a different kind of insurance.
Step 4 = Store the stuff in the warehouse - includes hiring a security company simply to get a discount on the insurance.
Step 5 = Ship ordered stuff to the end user, finally, the user pays for the shipping insurance.

i.e. Insurance is a big factor in our final price. These other countries either have orders so big that a couple of missing parts will go unniticed, or have much cheaper insurance rates, and that can make all the difference.

Now, you can risk it and skip the insurance thing totally, but then you're dead if something happens.

Make sense ?
 
jamieb said:
According your argument, what is stopping an SA Retailer buying from a US Retailer at the reduce price and shipping the goods over here, collecting a 100% markup on the goods? As was pointed out earlier, Digital Planet is only collecting a 10% markup on the HP Laserjet. The 90% - vat - shipping costs is still a significant chunk.
Click to expand...

Nothing except maybe the same issues that you would be faced with:
1. Don't ship to SA.
2. High shipment / import costs.
3. Like Hifi Corp, warranties issues on goods sourced through a different channel, HP SA won't support something not sourced through one of their channels...

Plus another very important one:
4. Customer's expect immediate gratification/delivery versus the cost of keeping stock (absorbing Rand/$ fluctuations, etc.) How many people do you know of that would be willing to wait 3 to 4 weeks after paying?

stoke thanks for for the additional clarity...
 
Last edited:
arf9999 said:
Actually they did. Most computer hardware is 0 duty rated.

But you still need to pay VAT.
Click to expand...

I stand corrected...my source was rather old, I must admit.
 
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