Indian and International Pricing

[mridulgoel]

Hi Odyssey
The specifics of all the calculations provided earlier are not important to a consumer. He doesn't care really. Nobody wants to dispute 40 to 50% shipping + taxes + duties. The whole issues is (and has been from the start of this thread) 50% on what? International MRP in USA or UK? It should be a manufacturer base price that is way below MRP. Add the 50% and arrive at a consistent price within 10 to 15% of international MRP, then watch the audiophile market boom !! People will simply stop purchasing on their trips abroad.

But it seems like what the dealer fraternity is constantly alluding to is that the Indian taxation system is so unfair no matter what, the burden of tax makes it an imperative to sell the goods at 50 to 100% over international price. In spite of comparatively high taxes in many other countries, India always ends up costing 50 to 100% more!! Nobody's going to buy that argument.

It does not look to me that disties and dealers are serious about market penetration - because this is almost always a "side business" for extra bucks.

I guess what we need is somebody to pioneer this in the A/V distribution industry - someone whose heart and sole and future lies in audio distribution solely. Only such a person will be motivated to really use his MBA degree to bring a pricing revolution and marketing strategy that beats the existing trend.

Nothing against you, just the way I feel ..

Edit: And PS: I do not imply the onus is entirely on you. I speak entirely in a general frame of mind.

Regards

I think in that case...
Armour Home products by us, and Usher and other products by ARN are rated well... Where Armour Products are available @ nearby 10% difference, and Usher is priced same as there US pricing...

 

[Raghav]

Exactly the point.

Sitting here in India it is not possible to order these products cheaper than your/ARN price. I can say the same for Wharfedale, Quad, Polk etc.. The hassle is not worth for 10%. Here I am talking of prime stock and not refurbished/clearance which is much cheaper in both places. Your pricing itself makes it unattractive to buy from outside.

My main grudge is with distributors where markups are close to 30-50% on international prices. If you, ARN and few others can sell within 10-15% why should we entertain others at 30-50%. In fact I had a specific thread calculating markups for around 20 speaker brands based on UK and Indian pricing.

I think in that case...
Armour Home products by us, and Usher and other products by ARN are rated well... Where Armour Products are available @ nearby 10% difference, and Usher is priced same as there US pricing...

 

[odyssey]

Gobble, Raghav
I think in general we are in agreement, it may come across otherwise but thats not the the way it is. Except for audio, remember that I am a consumer for everything else here - from PCs to accessories to TVs, etc

But there is something interesting here that doesnt add up - if you assume that the distributor pricing here is the same as the distributor pricing in the US and if we agree that the market there is much larger and competition much larger where distributors/retailers are forced to figure out creative ways to cut costs and reduce prices and if in India the distributors for the same products are around the same MRP (in that ballpark) while paying huge duty and VAT, etc then the only thing to figure is that the gross margin made by Indian distributors/retailers is lower, much lower. Then, does it mean that the foreign distributors/retailers are over-pricing? or am I missing something here? ...seriously ?

cheers

 

[Sujit]

I think in that case...
Armour Home products by us, and Usher and other products by ARN are rated well... Where Armour Products are available @ nearby 10% difference, and Usher is priced same as there US pricing...

Thank you.. so we both agree on "core" subject!

Exactly the point.

Sitting here in India it is not possible to order these products cheaper than your/ARN price. I can say the same for Wharfedale, Quad, Polk etc.. The hassle is not worth for 10%. Here I am talking of prime stock and not refurbished/clearance which is much cheaper in both places. Your pricing itself makes it unattractive to buy from outside.

My main grudge is with distributors where markups are close to 30-50% on international prices. If you, ARN and few others can sell within 10-15% why should we entertain others at 30-50%. In fact I had a specific thread calculating markups for around 20 speaker brands based on UK and Indian pricing.

An example will the be Monitor Audio prices... I have seen them go into orbit!

The day the industry can get around to giving competetive pricing, is the day you will see sales going north! As an individual customer - my cost of acquisition is of paramount importance to me... the rest of it is hazards of doing business!

 

[mridulgoel]

See, as i have been saying frm beginning, things differ.. and i knw tht me and sridhar gt a good support...
Bt as per all the discussions, when all of the brands like Q, Usher, Polk, etc, when there prices are good, bt earlier even we were costly, but our quantities increased, so our prices improoved, so did the customer gt benifited..

I dont think B&W, or some other sells so good quantities for now, maybe even they can come down, once there quantity increases as well...

 

[Raghav]

Chicken and egg.

When B&W (just an example) reduce mark-ups, they get more customers. Its not good that "when they get customers they will reduce markups". I feel this in some way also shortchanges the initial customers who supported you and made you a success. Just my thoughts.

See, as i have been saying frm beginning, things differ.. and i knw tht me and sridhar gt a good support...
Bt as per all the discussions, when all of the brands like Q, Usher, Polk, etc, when there prices are good, bt earlier even we were costly, but our quantities increased, so our prices improoved, so did the customer gt benifited..

I dont think B&W, or some other sells so good quantities for now, maybe even they can come down, once there quantity increases as well...

 

[venkatcr]

It is also possible that some products are priced at a particular point irrespective of country and other issues to act as an entry barrier. Maybe the manufacturer wants to maintain a certain level of price to highlight the products reputation.

Cheers

 

[gobble]

Gobble, Raghav
I think in general we are in agreement, it may come across otherwise but thats not the the way it is. Except for audio, remember that I am a consumer for everything else here - from PCs to accessories to TVs, etc

But there is something interesting here that doesnt add up - if you assume that the distributor pricing here is the same as the distributor pricing in the US and if we agree that the market there is much larger and competition much larger where distributors/retailers are forced to figure out creative ways to cut costs and reduce prices and if in India the distributors for the same products are around the same MRP (in that ballpark) while paying huge duty and VAT, etc then the only thing to figure is that the gross margin made by Indian distributors/retailers is lower, much lower. Then, does it mean that the foreign distributors/retailers are over-pricing? or am I missing something here? ...seriously ?

cheers

If the taxes are low over there, then the angle you bring in this post say is worth considering, after accounting for higher shipping cost from Far East to US.

Then we never know the real cost of in-country surface transport warehousing and distribution overheads to really pinpoint Aha!!


Regards

 

[murali]

It is also possible that some products are priced at a particular point irrespective of country and other issues to act as an entry barrier. Maybe the manufacturer wants to maintain a certain level of price to highlight the products reputation.

Cheers

That is major point. Some time back, when I bought a few items from Rel's Chennai distributor and they were looking for adding more brands and sought my suggestions, I recommended Ayre to them. Later these guys were in USA and when I enquired, they said they could not strike a deal with Ayre. Since I use Ayre products and have a direct communication channel with them, I came to understand this aspect of the business. Companies like Ayre, Vandy etc stick to certain price levels in line with certain quality, reputation, customer expectations etc and don't let distributors/dealers play around with their prices. You won't find significant differences among their prices from one dealer to another.

Remember what happened to gold business? A few years back with all that protectionism leading to a flourishing grey market, gold was smuggled and fancy for every Indian. Then deregulation came and what happened? Middle East was the haven of gold business and now I find no difference between the price here and back home. What happened to the grey market?

Why this stepmotherly treatment to consumer electronics? To protect who and what? Deregulate the market and let us see the results. Even Europe imposes 17.5% VAT but then it is applied uniformly with no room for corruption and different scales for different people. In this 21st century with all praise and hues about our country, don't you guys realise the stupid insane bureaucracy regulating our market? They loosened all rules when cell phones, computers started flooding the market and I don't believe Indian companies raised objections against such goods for protectionism (may be unlike Chinese, we are incompetent in manufacturing).

My last word. Audio/video consumer electronics too are just a "business" and all economic laws and concepts apply to these. Unless the protectionist mentality and bureaucratic influences are eliminated, we will be still discussing these things in this same forum even after 5 years. Unless...

cheers and bye.
murali

 

[mridulgoel]

Yes Venkat you are right...

Initially if i pick up any new brand, i will not pick a container load or stock worth Lakhs, i will first pick up some demo stock, in second i will get 5pcs of most moving models...then slowly as the demand will increase the supply will increase and with thn i will get a better discount, using which i will be able to reduce the prices....
So, Raghav if you think it from the Distributor point of view, you cannot expect them to start with lots of stock...and lakhs of investment...

And Murali, i understand your point, but, you see, today HiFi is not a essential market, it falls under the luxury category apart from CFLs, Power Cables, Computers, etc...so till the time, its a day to day commodity, its difficult to put any kind of restrictions...

 

[captrajesh]

Now rearding being arrogant, CaptRajesh... i always mind my words, and you dont have any rights to pin point me, so plz be away from this...

My dear sir,

I had never stated that you are arrogant. I wanted to gently prod you on your usage of certain terms listed below. Having interacted with you in one of your threads, I thought we are familiar enough for me to do that rather than report the posts but it seems you still carry the grudge of my posts in your thread regarding sale of some speakers. Hence I now did what I should.

we screw a person more

Earlier there use to be countable members on Forum, now they are increasing like bugs

we are screwed because of all the bloody high taxes

My friendly advise, by using such language in putting forth your argument, you are certainly not endearing your self in the forum who have sizable number of potential clients for you.

 

[mridulgoel]

Thanks for what you did...

Now mind your words...I am not here to fight with people like you, and know my words right...

And one main thing, if you think i am being arrogant to you, because u didnt purchased anythin frm me,
so i hardly care about tht...members enquire daily about one or the other product, but very few actually
buy them...so tht doesnt mean tht i shud be harsh on thm...
But, if you put ur comments, just bcas u wnt to say, without havin any justification, i will be arrogant...
and your reportin my post arrogant doesnt affect, bcas as u said, there are hundreds of people in here,
and i never put anyone of thm in negative, but here u hv taken things personally...so let it be...

Before pin pointing others, its always good to see, if we have nt done the same mistake...

 

[HiFiVision]

There has been enough of a discussion on this topic. This thread is now closed.