Nintendo Wii pricing explained

The answer is in the article even before the explanation is provided

"We immediately got in touch with the Wii’s local distributor Core Group for an explanation."
 
the wii was a great investment for me. bought one at R2700 (actually i bought it with the vouchers i received from game when i got a cell contract from there) and sold it six months later for R3400 :D
 
This means that in South Africa the Wii is fixed to European prices. When we consider that in Europe the Wii sells for €250.00 (R3250.00), our price of around R3400.00 does not look too bad, especially when we take shipping costs and import taxes into account. At this rate, it would seem that Core’s profit margin on the console is quite slight.
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I am pretty sure that they don't pay the full retail price for the consoles they import...

We were going to buy a Wii but ended up giving it a miss. At that price I don't think that it is good value for money. Isn't the XBox arcade a lot cheaper in South Africa and pretty much does what the Wii can do with better graphics and more "real" games?
 
I just want a wii for mario kart :(

But at that price I will just have to say.... NO
 
So basically, as long as the Wii continues to be the top selling console in the world, there is no need for Nintendo to cut its price.
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Not if MS has their way. I really can't believe how 'nice' MS are being about this. But then I guess we get skinned when it comes time to buy games. I do love my 360. I love it even more with my new 40" Bravia. :D

If Nintendo can make $6 in the US then whats the problem with implimenting the same policy in the rest of the world. I'm puzzled. o_0 Oh well, its their problem.

I'd like a PS3 mostly for bluray, but its so damn expensive and the controller is very uncomfortable in my hands. Not to mention PS3 games are even more expensive than 360 games. For me its almost a waste of money.
 
6 $ may sound minimal, but you have to keep in mind that they ship millions of units....it's about volume, not margins...like most things in business...
 
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According to Core Group, South African Nintendo distribution works alongside Nintendo in Europe. This is largely due to the fact that we share the same time-zone which makes business interactions far more convenient than working alongside Nintendo in North America for example.
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That can't be true, its just can't be. If i had a supplier that sold me something for 250 euros, and another supplier willing to sell me the same product for 250 dollars as long as I worked different hours.... I'm sure core can hire some poor bastards to work grave yard shifts and communicate with the states to buy stuff cheap??
 
High Prices => Core Group

All I can say is that the furthest you have to look for the high prices IS the Core group, look at the prices of Apple products locally, and look what happened with tomtom, they couldn't get high enough margins so they made some excuse to not distribute it anymore.

If Microsoft can organize an efficient distribution channel why can't Nintendo (or is it just because of the Core group).
 
incaseofire said:
6 $ may sound minimal, but you have to keep in mind that they ship millions of units....it's about volume, not margins...like most things in business...
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True, but they not in it to make money off the consoles... hence PS3 selling below cost (apparently). The money's in the games, with some Wii games selling for a ridiculous R700 locally! Case in point.
 
Im calling Bull**** on this one... it's the same story with Apple. *The Rotten Core. If this were the case, then Xbox, PS3, PSP, HP, GARMIN and every other imported brand would be in the same boat and no one would complain? I'm so tired of the Core Group. Would be interesting to see how the DS compares to overseas pricing?
 
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Funny how this only applies to stuff that Core imports and has a monopoly on.
 
..well what do you expect him to say?

"We rip you off because we can."

No. So of course it's all scapegoating and lies.
 
That's complete bull. The wii launched at $200.

This actually poor reporting. if the 360pro 60gig is more expensive than the wii in europe, why is the wii more expensive than the 360pro 60gig here?

RPM, what gives?
 
This means that in South Africa the Wii is fixed to European prices. When we consider that in Europe the Wii sells for €250.00 (R3250.00), our price of around R3400.00 does not look too bad, especially when we take shipping costs and import taxes into account. At this rate, it would seem that Core’s profit margin on the console is quite slight.
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The wii is manufactured in China. Thus, it needs to be shipped to europe as well as the us as well as to sa. Do not blame shipping.

In most cases the taxes in europe and the us is higher than in sa on things like the wii. Do not blame taxes.

The distributors in europe will also make money. Just a LOT less than the core group. Blame the core group!
 
Qwikslver said:
That's complete bull. The wii launched at $200.

This actually poor reporting. if the 360pro 60gig is more expensive than the wii in europe, why is the wii more expensive than the 360pro 60gig here?

RPM, what gives?
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Before you accuse me of "poor reporting" you should check your facts mate.

The Wii launched in the USA in late 2006 at $250. Fact.

http://www.msnbc.msn.com/id/15802977/

The Wii costs $250 and includes one game
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http://wii.kombo.com/article.php?artid=7696

September 14, 2006 - On the price, I think they're overshooting, to put it politely. With only one controller/nunchuck in the box, and the removal of DVD-playback, $250 is asking a bit much
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I could go on, but since you feel its acceptable to blatantly discredit a journalist based on a whim, without providing any evidence or substantiation for your claim, my two official citations should suffice.

Furthermore, I explained why the Xbox is cheaper here than it is in the USA in this article http://mybroadband.co.za/news/Gaming/6208.html

Microsoft operates in SA as a subsidiary of Microsoft USA. In theory this means that they are able to control pricing in specific locations in order to remain competitive relative to different world markets. In terms of unit costs, Microsoft just about breaks even on every Xbox 360 sold in America.
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zamicro said:
The wii is manufactured in China. Thus, it needs to be shipped to europe as well as the us as well as to sa. Do not blame shipping.

In most cases the taxes in europe and the us is higher than in sa on things like the wii. Do not blame taxes.

The distributors in europe will also make money. Just a LOT less than the core group. Blame the core group!
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Looks like Core in the company we all love to hate :D

Here is their pricing break down for the Nintendo Wii, courtesy of an industry insider. My explanation was intentionally simplistic for the purposes of the article.

RRP Wii Sports SA: R3499
RRP Wii Sports EU: €249

Deduct VAT:

SA (14%): R3069.30
EU (19%): €209.24

Same currency:

Spot rate EUR/ZAR 12.78, but an industry insider revealed that Core use a forward cover rate of €13.35, and thus:

SA: €229.91
EU: €209.24

So, the product is 9.88% more expensive in South Africa.

When you take into account the fact that Core pay 8.05% Ad Valorem tax on imports, the net difference comes down to less than 2%.

I know its fun to get angry, but sometimes you jsut have to look at the facts
 
Well who cares about the reason, give Core the middle finger and buy a Xbox.
 
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