UK prices vs USA prices

Discussion in 'Olympus Cameras' started by pertgate01, Jan 29, 2013.

  1. pertgate01

    pertgate01 New to Mu-43

    9
    Jan 31, 2012
    I'm sorry for creating this thread to ask a useless/stupid question. But I am just really really curious.

    Why do cameras like the OM-D cost more in the UK? I just went to the UK Amazon and checked that their OM-D prices were 992 pounds which is equivalent to $1562. That is $562 more than what we pay!

    1. Is it that they are making a higher average salary?

    or is it that

    2. Everything is relative. $999 here in the US is equivalent to $992 pounds for them. So it is just as affordable here as it is there. The only difference is the strength of their economy to ours.

    or

    3. It just straight up costs more for them.

    Sorry for my stupid question. I don't understand economics at all. I haven't taken a single economic class in college and only took a single semester in high school. So if someone could explain it to me in layman's terms, I would really appreciate it. It would be a good lesson in economics.
     
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  2. pertgate01

    pertgate01 New to Mu-43

    9
    Jan 31, 2012
    The reason that I started wondering this was the rebates that are going on in the UK.

    They get a free Olympus 45mm with the purchase of an OMD.

    SOmeone in the thread noted that people in the US are paying a lot less than they are, so the Olympus 45mm rebate is justified.

    I was wondering how accurate that person's statement was. I guess I do want to learn a little economics. Just in layman's terms though.
     
  3. BigTam

    BigTam Mu-43 Top Veteran

    773
    Mar 19, 2012
    Dortmund, Germany
    Ron
    Fairly simple, really: US prices are free of tax. Some states charge sales tax, but the prices you see are the tax-free prices. Whereas, all EU countries, including the UK, must include Value-added Tax, at somewhere between 19 and 25%.

    Also remember that japanese companies need their income in yen. This means that if they estimate that a currency will lose its value against the yen in the year to come, they will charge a little more to cover themselves.
     
  4. AceAceBaby

    AceAceBaby Mu-43 Veteran

    249
    Jan 21, 2013
    Tax accounts for a good amount of the difference, sometimes all of the difference on certain products, but from my experiences when I lived in the UK, I found some items can cost almost double. (AV receivers were particularly bad for mark-ups there).

    Standard VAT rate currently is 20%, which is applied to most items. There are other rates, and exceptions, but generally luxury goods and electronics will be 20%.

    I bought my lenses from the US (during trips) and Hong Kong (mail order).
     
  5. kevinparis

    kevinparis Cantankerous Scotsman

    Feb 12, 2010
    Gent, Belgium
    plus 1 for what big tams says

    sales tax in the US is not generally as high as VAT is in europe. I visit california often.. sales tax there is around 11% and camera stores often have 'tax free' weekends

    add into this exchange rates between currencies (yours, the country your are buying in and the country of the manufacturer), the cost of doing business in a country and it does add up to a difference

    I do tend to buy when I am in the US as the lower tax and a good exchange rate make the sticker price lower ( a thousand euros has bought me anything between 1600 and 1250 dollars over the last 6 or 7 years)

    Ironically it might be more expensive to buy a camera in japan than europe if you are a european


    K
     
  6. BigTam

    BigTam Mu-43 Top Veteran

    773
    Mar 19, 2012
    Dortmund, Germany
    Ron
    One other point: the EU has a minimum guarantee period of 2 years. Most other areas have less, which means lower costs / prices.
     
  7. Mikefellh

    Mikefellh Mu-43 Top Veteran

    939
    Jun 7, 2012
    Toronto, Canada
    That was going to be my point!
     
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  8. wyk

    wyk New to Mu-43

    7
    Oct 16, 2012
    As well as the discrepancies in tax - it also costs more to ship to the UK. Many electronic devices are made in Japan, China, or the pacific rim. These are incredibly busy shipping lanes that can deal in great volume. Speaking of volume, the UK does not import as much electronic equipment, so their costs are more from their suppliers and middle men. Add in the size of the market, and often higher wages, and their retail prices can not sustain as low a percentage for profit as the US market can.
     
  9. harry_s

    harry_s Mu-43 Regular

    180
    Jul 19, 2011
    Wiltshire, UK
    It's always been the same here, right back to the days of the Sega Mega Drive!

    If you want a real shock unleaded petrol costs £1.34 a litre here at the moment (which is cheaper than it has been), which is £5 ($7.85) for a US Gallon, as far as I can tell that's more than double the average price in the US.
     
  10. yourguitarhero

    yourguitarhero Mu-43 Regular

    78
    Jul 29, 2011
    Yes, electronics and other sort of luxury things (guitars for example) are more expensive here. We have higher sales tax and it's a more expensive country to do business in.

    However, our groceries are cheaper. I was in staying with family near Buffalo at Christmas and things like toiletries, bread, fruit/veg, soda and beer were more expenisve at the supermarkets, and that was before your sales tax. Stuff for asian cooking was way way more expensive.

    On the flip side again, eating out in the USA is much cheaper - with the higher price of groceries I can see why you eat out way more than we do - costs less and is easier.