Why can people not understand the Price disparity north/south re: debenhams

juuge

Jaysoose wrote: »

Yay....another poster that cant be bothered to read the thread past the title then slag off the OP (me)!!! Im gonna shout the next bit then leave the thread altogether as its pissing me off.
QUOTE] Ahh!:) don't go !!

Blue-sky

Beg to differ, there are approximately 350,000 whingers in this country of varying degrees, collectively known as 'public Servants'

Lplated

rubadub wrote: »

No, simplifying it the way that study does not hold up. Has anybody a link to the actual study,

Here's a link to the study - http://www.forfas.ie/publications/2008/title,2623,en.php

Heres a comment from the Irish times (http://www.irishtimes.com/newspaper/breaking/2008/1222/breaking50.htm
) which puts it much better than I could -

"Forfás’s study, which was published today, shows that while operating costs for retailers in Dublin were on average 25 per cent higher than in Belfast, such costs accounted for only 20 to 25 per cent of the total cost of a retail good, meaning that the price differential between goods should only be 5 to 6 per cent higher in the capital."

Hope that helps.

rubadub

Lplated wrote: »

Here's a link to the study - http://www.forfas.ie/publications/2008/title,2623,en.php

Heres a comment from the Irish times (http://www.irishtimes.com/newspaper/breaking/2008/1222/breaking50.htm
) which puts it much better than I could -

"Forfás’s study, which was published today, shows that while operating costs for retailers in Dublin were on average 25 per cent higher than in Belfast, such costs accounted for only 20 to 25 per cent of the total cost of a retail good, meaning that the price differential between goods should only be 5 to 6 per cent higher in the capital."

Hope that helps.

Yep cheers. I saw you post it in the other thread too.
The study said

The purpose of this study was to examine the composition of retail business costs in Ireland and to determine how their cost base compares with retailers in other countries. While operating costs are on average 25 percent higher in Dublin than in Belfast, they account for a relatively small share of
total costs (circa 20-25%).Our analysis highlights that higher operating costs in Ireland add approximately 5-6 percent to the total cost base of retailers in Dublin versus those operating in Belfast

I am not familiar enough with economic terms, but I presume "cost base" does not mean "price the consumer has to pay", which is what the irish times bit inferred. I saw nowhere in the study where it mentioned actual prices customers must pay, though I did just skim through it.

It would seem to me the study could be legit, but the irish times people picked it up wrong.

Lplated

rubadub wrote: »

I am not familiar enough with economic terms, but I presume "cost base" does not mean "price the consumer has to pay", which is what the irish times bit inferred. I saw nowhere in the study where it mentioned actual prices customers must pay, though I did just skim through it.

It would seem to me the study could be legit, but the irish times people picked it up wrong.

I assume you're being sarcastic? How many possible ways could you interpret the line

"Our analysis highlights that higher operating costs in Ireland add approximately 5-6 percent to the total cost base of retailers in Dublin versus those operating in Belfast"

It would seem to suggest to me that the higher costs here add 5 to 6% to the overall costs of products being sold in Dublin as against in Belfast.

As an aside, I was surprised at the lack of retailers or their representative groups down here coming out to either rubbish the Forfas report or to 'defend' their obvious profiteering. But perhaps they haven't managed to figure out the difficulty in the report the same way you seem to have.

seamus

Just to deal with the VAT issue, don't take "Ireland has a higher VAT rate" as an excuse for a product being 30%+ more expensive in euro.

The VAT rate difference is only €6 in every €100. So if something is priced at STG£20 and €30, then VAT only makes up €1.20 of that €10 difference. If we take today's exchange rate of 90p/€1, then that's another €2.20 difference in the exchange rate.

Which leaves €6.60 price difference after you take econmic factors. And this is a simple example. There is no way that > 20% of the price of an item is down to staff and shipping costs.

Shops claiming that they bought their stock "months and months" ago is

1. Bollox - Many shops get new stock in on a weekly basis and because clothing is seasonal, it would be very rare for any particular item to be in stock for more than 3 months
2. Irrelevant - Changes in exchange rate are a problem from the retailer, not the consumer. It's a form of hedging - you can buy your stock now at the current rate or wait until you need it in 3 months and buy it at the rate then. Either way, what you paid for it is irrelevant to the consumer.

rubadub

Lplated wrote: »

I assume you're being sarcastic?

No

Lplated wrote: »

I assume you're being sarcastic? How many possible ways could you interpret the line

"Our analysis highlights that higher operating costs in Ireland add approximately 5-6 percent to the total cost base of retailers in Dublin versus those operating in Belfast"

It would seem to suggest to me that the higher costs here add 5 to 6% to the overall costs of products being sold in Dublin as against in Belfast.

Yes, and as I was saying in the other thread, I would interpret it being 5-6% more presuming the cost of the product was the same to the retailer north or south. But we have higher RRP here, so the retailer pays more to the wholesaler. Then the retailer has to pass on the higher VAT too, of which he sees none. So the customer foots these 3 extra prices.

Lplated wrote: »

As an aside, I was surprised at the lack of retailers or their representative groups down here coming out to either rubbish the Forfas report or to 'defend' their obvious profiteering. But perhaps they haven't managed to figure out the difficulty in the report the same way you seem to have.

Perhaps they picked it up the same way I did, and fully agree with it, and see no reason to defend themselves..... (not that they have to defend anything BTW, its a free market)

Lplated

rubadub wrote: »

No
But we have higher RRP here, so the retailer pays more to the wholesaler. Then the retailer has to pass on the higher VAT too, of which he sees none. So the customer foots these 3 extra prices.



Perhaps they picked it up the same way I did, and fully agree with it, and see no reason to defend themselves..... (not that they have to defend anything BTW, its a free market)

On the price retailers are paying - would you not think that those retailers who have presence on both sides of the border, or both sides of the Irish sea (e.g. Dunnes, PC World, Debenhams, Lidl etc...), are sourcing product for both markets, North and South, at the same price? Agreed there is a vat differential.

On the defence - I agree that they don't have to defend anything, it is a free market, HOWEVER, this report was ordered by the Minister who ran into difficulty while she was castigating us for going elsewhere, and using the retailers arguments to bolster her position, when reporters put figures to her that didn't tally with the argument she was making. She called for an independent agency report (one supposes to bolster her position), only to discover that the report casts severe doubt (regardless of the exact figures involved), on the retailers arguments.

Its about 'optics' - if the report justified the price differntial between North and South, then politicans would be able to continue to shout about patriotism and retailers would have a standard defence everytime the issue arose. Indeed, there are probably people who would willingly pay the higher prices once there was some sensible justification for it.

Unfortunately for those vested interests, it didn't turn out like that. Now retailers will be forced to make harsh desisions, possibly as extreme as charging us a fair price down here. Politicans too will have to make harsh decisions to shore up the budget position caused by fall in vat, crt etc... Democracy in action, eh?

Hookey

There's a very telling line in that report:

Forf&#225 wrote: »

"While retail operations in Northern Ireland face these same physical challenges, interviews with retailers suggest that UK retailers equalise transport and distribution costs across all of their Great Britain and Northern Ireland stores, effectively subsidising stores in Northern Ireland."

This doesn't tell the whole story, as it implies UK retailers don't subsidise stores in the Republic, which is not true. Ireland is almost always run from within the UK Head office of these retailers (unlike other non-English speaking territories), and sits on the UK P&L. The whole argument about Dublin being more expensive to operate in than Belfast is irrelevant; London is also way more expensive than Belfast, but retailers don't differentiate their prices (for non-food anyway) between London and Belfast. UK retailers have to factor in slightly higher marketing and merchandising costs for Ireland (localised POS etc.) but its factored in from the start and absorbed in to the general marketing/VM budgets (in every retailer I've worked in anyway). Transport is the same for NI as Ireland, which just leaves rent and staff (ignoring VAT). Rent can be more in central Dublin than central London, but its less in the out of town retail parks. Staff wages in Dublin are slightly higher than in London, but staff costs are about the same because UK employers pay higher national insurance contributions etc.

The only reason prices are higher in Dublin from UK companies is because they can. Currency fluctuations are seized upon at every opportunity to take extra profit. The biggest irony is that this profiteering plays into the hands of Irish-only businesses, because if the UK businesses didn't profiteer then the Irish ones would be forced to work at lower net margins (as the UK businesses have the advantage of economies of scale). Unfortunately for them, the recent currency changes have gone so far and so fast, its left their cozy little arrangement totally exposed.

the groutch

I wonder if ever shop in morthern ireland increased their prices by about 25% to narrow the disparity, would everyone be happy then?

Jaysoose

the groutch wrote: »

I wonder if ever shop in morthern ireland increased their prices by about 25% to narrow the disparity, would everyone be happy then?

You obviously wouldnt.

mcwhirter

Jaysoose wrote: »

The gf's mum works in debenhams blanch and was telling me today that nearly every customer is whinging on about the sterling prices on the goods, people trying to pay in sterling then getting stroppy when they cant etc.

Why cant people educate themselves on this whole thing? she actually had someone walk away from the till without paying in a strop today over this, the customer obviously thought they were right etc but jesus christ is it so hard to understand the higher vat rate, higher wages, higher costs and the fact that the stock was bought months ago at a worse sterling rate??

Im not defending debenhams as they oviously stick a bit on for themselves but walking out of a shop in a huff because they wouldnt give you an exchange rate you liked is ridculous.

Just thought i would vent.

So how can the majority of the British shops use an exchange rate of approx 1.7 euros to the pound, as I have found in debenhams,laura ashley and the like. The exchange rate for sterling when the euro was first introduced was between 1.6 and 1.7 for the year 2000 but since 2003 it has been between 1.4-1.45. And now 1.1 euros to the pound

Its got nothing to do with the different overheads here in Ireland, they are basing the rate on what it was originally 9 years ago.

That is why we feel we are being ripped off.

Jaysoose

mcwhirter wrote: »

So how can the majority of the British shops use an exchange rate of approx 1.7 euros to the pound, as I have found in debenhams,laura ashley and the like. The exchange rate for sterling when the euro was first introduced was between 1.6 and 1.7 for the year 2000 but since 2003 it has been between 1.4-1.45. And now 1.1 euros to the pound

Its got nothing to do with the different overheads here in Ireland, they are basing the rate on what it was originally 9 years ago.

That is why we feel we are being ripped off.

The only people who get ripped off by debenhams are the muppets that pay the price, customers walk in under their own steam, they take the money out of their own wallets and hand it over. This is not a rip-off its gross stupidity by the consumer simple as. Giving out to a part time members of staff that have ABSOLUTELY NO INFLUENCE OVER THE PRICE further compounds the fact that people are thick as pig-**** and think throwing a wobbler gets them anything apart from stares from people who think they look like a tit.

mcwhirter

Jaysoose wrote: »

The only people who get ripped off by debenhams are the muppets that pay the price, customers walk in under their own steam, they take the money out of their own wallets and hand it over. This is not a rip-off its gross stupidity by the consumer simple as. Giving out to a part time members of staff that have ABSOLUTELY NO INFLUENCE OVER THE PRICE further compounds the fact that people are thick as pig-**** and think throwing a wobbler gets them anything apart from stares from people who think they look like a tit.

Erm, it was only a few clothes, not that serious really.

rubadub

Lplated wrote: »

On the price retailers are paying - would you not think that those retailers who have presence on both sides of the border, or both sides of the Irish sea (e.g. Dunnes, PC World, Debenhams, Lidl etc...), are sourcing product for both markets, North and South, at the same price? Agreed there is a vat differential.

There is transport & admin etc to get it here. Where I work we get containers of machines from China direct to the UK. If a machine is needed here it is overnight delivered from the UK, costs a fortune. Another major company we supply charges the same for a machine to the mainland UK as NI, even though it costs them a fortune to send to NI.

They might get stuff for the same price, and even if VAT was the same I would expect very different prices for the majority of goods. Also they would be idiots not to match what local companies are charging. Would shareholders be impressed with companies not trying to maximise profits?

Lplated wrote: »

Its about 'optics' - if the report justified the price differntial between North and South, then politicans would be able to continue to shout about patriotism and retailers would have a standard defence everytime the issue arose.

It didn't mention much about prices to the actual customer, I would have like to see "typical shopping basket" style stuff. It was only the Times that came up with bit inferring we should be handing over 5-6% more at the till, either they misread it or wanted to flog papers.

Jaysoose wrote: »

The only people who get ripped off by debenhams are the muppets that pay the price, customers walk in under their own steam, they take the money out of their own wallets and hand it over. This is not a rip-off its gross stupidity by the consumer simple as.

Stupidity is also going in to debenhams, seeing a dual priced product, storming out in a huff, going elsewhere and paying the exact same price for a similar product without the dual label. Actually you might end up paying more, since dual labelling allows for more economies of scale.

Now retailers will be forced to make harsh desisions, possibly as extreme as charging us a fair price down here.

It appears many can't charge what some consider a "fair price", otherwise they would not be closing down.

the groutch

"Stupidity is also going in to debenhams, seeing a dual priced product, storming out in a huff, going elsewhere and paying the exact same price for a similar product without the dual label."


best relply EVER!!!

whizkid1

Nobody would mind a bit extra but uk chains are charging us double. If you cross the border everything is half price. Because the Paddys up till now have been stupid enough to pay these prices

If you even look at online retailers they are charging up to 1/3 more because we are prepared to pay it.

And the bottom line is that the staff in Debenhams are getting stick because nobody in management has the basic cop on to get a priceing gun, remove the uk price and price it in the currency of the country they are doing business in

They are insulting our intellegence

rubadub

whizkid1 wrote: »

And the bottom line is that the staff in Debenhams are getting stick because nobody in management has the basic cop on to get a priceing gun, remove the uk price and price it in the currency of the country they are doing business in

I am very glad they do not pay somebody to do this, the cost of employing a person to do this would be passed onto the customer resulting in an even higher priced product, just to appease the moaners who have probably been buying mulitcurrency labelled books & magazines for decades.

ven0m

just throwing my 2 cents in here, but:

http://www.rte.ie/business/2008/1222/retail.html

rubadub

ven0m wrote: »

just throwing my 2 cents in here, but:

http://www.rte.ie/business/2008/1222/retail.html

You should read the real report, they interpret it wrongly. They are inferring that the customer should only hand over 5-6% more at the till. I did not see that spelt out anywhere in the actual report.

Think about it, ipods, consoles, coke etc have their wholesale prices controlled by the manufacturers in different regions. So the 5% extra should be on the wholesale cost, AND the vat. So it should cost a hell of a lot more.

ven0m

rubadub wrote: »

You should read the real report, they interpret it wrongly. They are inferring that the customer should only hand over 5-6% more at the till. I did not see that spelt out anywhere in the actual report.

Think about it, ipods, consoles, coke etc have their wholesale prices controlled by the manufacturers in different regions. So the 5% extra should be on the wholesale cost, AND the vat. So it should cost a hell of a lot more.

iPods that come in from Cork & have to be shipped to the UK should cost less ....... I think not .... methinks someone is sucking hard at the teats of RipOff Ireland.

Also, I know for a fact as a friend is a manager of one of the Game stores here in Ireland & has told me the price difference is PURELY cos 'The irish will generally pay more without complaint'.

Absolam

ven0m wrote: »

Also, I know for a fact as a friend is a manager of one of the Game stores here in Ireland & has told me the price difference is PURELY cos 'The irish will generally pay more without complaint'.

Take a look at prices in GAME/GameStop/HMV over Christmas vs Christmas 07. The price of a new release game dropped by about 33%... from €74.99/€69.99 in 07 to €49.99/€39.99 in 08. Prices change.. and not always for the worse.

ven0m

Absolam wrote: »

Take a look at prices in GAME/GameStop/HMV over Christmas vs Christmas 07. The price of a new release game dropped by about 33%... from €74.99/€69.99 in 07 to €49.99/€39.99 in 08. Prices change.. and not always for the worse.

All I know is my 80GB PS3 with the new Grand Theft Auto Game, FIFA 07 & some other poxy title I shagged in a corner somewhere cost me less than €340 in total in Newry, while had I bought the same said items down here I'd have ben taken for alot more than that.

I would also point to a guitar I RANG a music store in Glasgow to ship to me, which was no bigger than Musician Inc in Dublin. Musician Inc wanted just shy of 700 euros for it, the guitar including shipping on Thomann was 500 euros, & the store in Glasgow I rang out of the blue just from the fact I bought from the store last time I took a visit there, sold it to me inc. shipping for approx. 428 euros.

The time has come for people to stop making excused for Irish retailers & British retailers here who have been taking the piss for too long cos 'the paddies will pay without complaint'.

Cash is king, & money talks ......

gurramok

rubadub wrote: »

I am very glad they do not pay somebody to do this, the cost of employing a person to do this would be passed onto the customer resulting in an even higher priced product, just to appease the moaners who have probably been buying mulitcurrency labelled books & magazines for decades.

I just hope your very thankful of the hundreds of euro's per head that is flowing out of the economy via the North.

As you say prices here have nothing to do with Sterling and more to do with costs, i'm glad to inform you that Tesco Ireland and Dunnes have miraculously reduced their prices across a range of grocery items which have to be consumed within a month (rules out fuel prices excuses) for now 2 weeks running.
A certain tesco manager who i know in D4 who has his hands tied regarding prices agrees with the above.

A little bit of shopping around by tens of thousands of consumers is hurting the multiples and the stay at home shoppers should be thankful of its result.

rubadub

ven0m wrote: »

iPods that come in from Cork & have to be shipped to the UK should cost less .

yes it might cost less for apple to get it there. This is like the forfas report, people confusing costs and the actual prices paid by customers. People are screaming at 16 year old girls in shops when it is Steve Jobs they should be moaning to.

ven0m wrote: »

All I know is my 80GB PS3 with the new Grand Theft Auto Game, FIFA 07 & some other poxy title I shagged in a corner somewhere cost me less than €340 in total in Newry, while had I bought the same said items down here I'd have ben taken for alot more than that.

Yep, Sony have higher RRP, another fine example of a fixed price item, if the retailer here sold it at wholesale prices and made no profit it still might cost more than in the UK.

gurramok wrote: »

i'm glad to inform you that Tesco Ireland and Dunnes have miraculously reduced their prices across a range of grocery items which have to be consumed within a month (rules out fuel prices excuses) for now 2 weeks running.

This happens every year after christmas. I have a press loaded with stuff with christmas branding on it that was sold off for next to nothing, most places usually well overstock before christmas and charge over the odds for it.

I am not sure why you quoted my bit about multi currency pricing, which results in less cost to the retailers.

ven0m

rubadub wrote: »

yes it might cost less for apple to get it there. This is like the forfas report, people confusing costs and the actual prices paid by customers. People are screaming at 16 year old girls in shops when it is Steve Jobs they should be moaning to.


Yep, Sony have higher RRP, another fine example of a fixed price item, if the retailer here sold it at wholesale prices and made no profit it still might cost more than in the UK.


This happens every year after christmas. I have a press loaded with stuff with christmas branding on it that was sold off for next to nothing, most places usually well overstock before christmas and charge over the odds for it.

I am not sure why you quoted my bit about multi currency pricing, which results in less cost to the retailers.

Jesus, you're great with the excuses - you a politician by any chance? Keep on keepin on there mate ...... it's people like me who shop with their feet that will benefit people like you, but you lot will never acknowledge it, but I will sit smug knowing the real truth.

manafana

The same people who give out about irelands prices compared to the north are same people who still think they dont get paid enough lol, we are all victims of inflations due to us all wanting more money grand in boom times terrible now as we are so expensive.,

ven0m

manafana wrote: »

The same people who give out about irelands prices compared to the north are same people who still think they dont get paid enough lol, we are all victims of inflations due to us all wanting more money grand in boom times terrible now as we are so expensive.,

Actually, I could care less about what I am paid (otherwise I wouldn't be doing the job I have now still), but I do believe in a fair price for a product, & a fair days wages for a fair days work.

So when prices drop, I assume you will be complaining & want to pay the old prices then will you

gurramok

I just cannot believe it. Tesco have hiked some of their prices at 25% a pop on some of their grocery range to back where they were around xmas time. (last time was NOT a special offer)

Now, has the Min wage + misc costs skyrocketed since then?

Can anyone explain the price hikes? Is this the reason?

rubadub wrote:

This happens every year after christmas. I have a press loaded with stuff with christmas branding on it that was sold off for next to nothing, most places usually well overstock before christmas and charge over the odds for it.

They have a 25% beer discount this weekend. They can reduce prices temporarily on some goods at their discretion.

I had hope to shop there regarding my previous post but now i'll go back up north yet again to save loads. Give with one hand and take with the other.:mad:

rubadub

ven0m wrote: »

Jesus, you're great with the excuses - you a politician by any chance? Keep on keepin on there mate ...... it's people like me who shop with their feet that will benefit people like you, but you lot will never acknowledge it, but I will sit smug knowing the real truth.

I also shop with my feet. I am just telling you the reasons (that you call excuses) are not as simple as you seem to think. Perhaps you are ignorant about multinational pricing policies, which are very common and nothing new by any means. This seemed the case when you said..

iPods that come in from Cork & have to be shipped to the UK should cost less .

A very naive assumption, who do you "blame" or have a problem with, Steve Jobs and/or the Irish retailer? and if both who do you have more of a problem with.