Friday, December 13, 2013

GST is not the problem

There has been quite a bit of talk this year about making a more even playing field for local retailers vs overseas retailers by changing GST laws. The latest article I read this morning in the New Zealand Herald.
The New Zealand Retail Association, who are quoted at the beginning of the article, are an excellent organisation but as a previous retailer and as a retail consumer - the excuse that customers buy from overseas retailers because of GST is just not right.

If local retailers and government want GST collected on overseas online purchasers - go for it. More tax to pay for education and health, (one can hope).

But I don't believe New Zealanders buy from overseas online retailers because of GST. Sure we might buy on price - but the price difference (with shipping), is significantly more than the GST put on items here.

I buy online from overseas places because:

  • I can not buy the product in NZ 
  • The variety is so much better - shoes!
  • It is substantially cheaper - we bought a scanner and printer for our point of sale system, for half the price from the USA rather than a NZ retailer, (who is a big brand Aussie company anyway). It was exactly the same product.

Ask a large chain retailer to order in a particular product from a brand they stock and the assistant looks at you blankly. What is on the shelf is what is deemed appropriate for you the consumer. The model that most fulfils your requirements is widely available worldwide but sorry they will not get it in for you. Then the bosses wonder why so many purchases are made online from overseas.

As retailers we also found the antiquainted NZ system of exclusive product distribution via several suppliers meant for some items there was a NZ exclusive distributor and then a South Island exclusive distributer from whom we had to purchase. Everyone in this chain was clipping the ticket. So by the time it was on our shelves the price was far higher than we wanted.

We came up with a variety of approaches to try and maintain a better price and quality of product for our customers than the big wholesalers. I know they have to pay customs clearance costs and freight but one wonders how greedy they are in the retail system.

On price can someone explain the book prices in NZ to me? I can understand freighting heavy books all the way to our shores could add a lot to the cost of a book. But I have also heard local printers printing locally written books say they can't compete with the price of books coming into NZ because our country is a dumping ground for books to save companies freighting them any further. This should mean books are cheaper but buying books in the USA is much cheaper. Even Amazon UK is often cheaper, with the difference in currency, than little ol' NZ.

So add GST if you want - I don't think it will help Hallenstein Glassons bottom line.

5 Favourite Sights Seen

  • 1996 Watching tropical lightning turn night to day, outside a little wooden church in a small village in Sabah.
  • 2004 Flying down the Rainbow Valley at 8000ft in a cessna on a clear blue day.
  • 2003 Seeing and hearing Michael Schmacher rolling out of the pit garage in his Ferrari in Hungary.
  • 2009 Chancing upon 100 or more dolphins just off the Kaikoura Coast swimming around, jumping out of the water, doing somersaults and generally having fun.
  • 2006 Finding a pool at the bottom of a waterfall in the bush at Kaikoura that was full of playing baby seals.