[tdw]

Traditionally Oz has been high cost because of import costs and low population. LP means low turnover so gross profit margins have tended to be higher than in more competitive markets.

As we slide further into the 21st century we are seeing a somewhat uncomfortable transition from old marketing techniques to new but as population grows, costs (mainly transport) come down , competition increases and prices will gradually follow.

Two things also need to be considered .... a business marks up its costs based on landed not ex factory. In Australia, said business also needs to add GST (Sales Tax/VAT). When you buy on line the business itself is not marking up freight costs and you are not paying GST. While this will not account for all of the differences in price it does account for some. The rest of it is presumably explained by the size of Craig Whitworth's bank balance.

In future I expect Australian businesses to discount freight costs when it comes to base for mark up.

 

[tdw]

"In future I expect Australian businesses to discount freight costs when it comes to base for mark up."

Does Toll Holdings still have everybody by the short and curlys?

To a certain extent but in recent times we've found a few alternatives. The UPS/DHL/Fedex mob have interesting, to say the least, prices down here as well.

In our business we invariably have our overseas suppliers ship small orders on their accounts cos they are so much cheaper than if we use our DHL account. Of course it has to do with volume but it is not helpful.

 

[tdw]

Not much anti-trust oversight downunder is there?

I may be misunderstaning you as to the meaning of "anti-trust oversight" but if by that you are talking collusion that's not what I meant. Of course it may well be that DHL/UPS/Fedex act as a cartel but I wasn't claiming that, merely that whenever we have had one of them quote us pricing our price is invariably higher than the price we get from our supplier in Europe.