Well, I finally decided to take the plunge and purchase Komplete 4 + Kore 2 from the UK, after much humming and harring about UK prices v US prices, etc, etc (see recent posts) and when I went to give Digital Village my Amex card number, they don't accept this card!!! FFS.

This is the only place I can get Komplete at an acceptable price, everywhere else (except the US) is extortionate, which I really don't understand.

Back to square 1



P

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

AmEx is massively more expensive for retailers to accept than anything else, which is the reason a lot of them don't do it.

Quote Sam York:

---

AmEx is massively more expensive for retailers to accept than anything else, which is the reason a lot of them don't do it.

---

Why are AmEx more expensive, out of curiousity? Surely it can't be THAT much more expenisve for a retailer, such as DV, to use AmEx!?!?!

The annoying this is, all the other stores that supply the same product I want DO accept AmEx, but they won't / can't do the deal for the same price.

P

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

If you use a credit card, the retailer is charged a fee. With Visa, Mastercard this can be 1% or 1.5% of the transaction value. With Amex it's 5%.

I don't understand why anybody takes it, to be honest. Certainly if you are going to offer goods at the cheapest price, you can't afford to.

If you want the extra service, it costs.

--------------------
Dynamite with a laser beam...


Edited by Steve Hill (06/12/07 09:23 AM)

5% is quite a hike from 1% - 1.5%. Yikes! I would normally use my Visa / Mastercard, but these are maxed out at the moment

I suppose I'll just wait until I've saved the cash, but hope the offer is still valid. That's the risk I take, unfortunately

... or go back to my original plan and buy from the US.

Cheers,
Peter

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

Quote Steve Hill:

---

If you use a credit card, the retailer is charged a fee. With Visa, Mastercard this can be 1% or 1.5% of the transaction value. With Amex it's 5%.

I don't understand why anybody takes it, to be honest. Certainly if you are going to offer goods at the cheapest price, you can't afford to.

If you want the extra service, it costs.

---

I think it 'cos Tiger Woods says it's good.


--------------------
Samplecraze
Stretch That Note

Hi Conz - you know the SRP for Komplete 5 is now £699, down from £999 for Komplete 4? I don't think this is so far from the US price, when you add in duty & VAT etc.

We do try and make sure that the prices UK retailers sell for are similar to everywhere else.

I don't think that DV have many of the Kore 1 + Komp 4 deal left (with the free software updates to K2 and Komp5).

I thought the Amex rate was 4%, but it's still way above the other cards and our website doesn't take it for this reason too.

Cheers

Steve Parker
Music Technology Manager
Arbiter Group Ltd
(UK distributor for NI)

I'd hurry to get one of those.

With the new Kore 2 software the package is just amazing. Every time I play with it I find new things that don't cease to amaze me. Last one has been the Tape echo thing in Guitar Rig 3 (a emulation of the roland space delay I believe). I mapped all the knobs in the Kore controller to every parameter of the echo and use that a send in Cubase and it's simply Dub heaven. You have knobs to increase the tape fluter, drop outs, acceleration, I can tap the tempo in the Kore controller buttons, etc...

I could go on for days about Komplete and Kore.

Of course I did have some issues with it too, one of them almost made me trash the whole thing, but so far all have been solved.

NI emailed the other day with some offers direct from their site, but I'm not sure if the package you are looking for is covered in the offers they had. Might be worth a look.

--------------------
http://soundcloud.com/richie-royale
http://www.mixcrate.com/richieroyale

Quote Stephen Parker:

---

I thought the Amex rate was 4%, but it's still way above the other cards and our website doesn't take it for this reason too.

---

Steve, I think it varies according to the size of your operation. We looked at taking Amex at this modest studio... suffice to say it doesn't do nicely round here!

Arbiter is probably a bit bigger than us though

--------------------
Dynamite with a laser beam...

Quote Stephen Parker:

---

Hi Conz - you know the SRP for Komplete 5 is now £699, down from £999 for Komplete 4? I don't think this is so far from the US price, when you add in duty & VAT etc.

We do try and make sure that the prices UK retailers sell for are similar to everywhere else.

I don't think that DV have many of the Kore 1 + Komp 4 deal left (with the free software updates to K2 and Komp5).

I thought the Amex rate was 4%, but it's still way above the other cards and our website doesn't take it for this reason too.

Cheers

Steve Parker
Music Technology Manager
Arbiter Group Ltd
(UK distributor for NI)

---

Hi Stephen,

Yeah, I did a bit searching today and can get K5 + K2 for £699 in the UK. Best I can get K5 alone is £569.99 which is actually quite a good deal, definitely closing in on US prices, but still £141 different. Check out this eBay item>>> Item #250193852174 - £443 + £35 shipping + £80 Duty & Tax = £558 TOTAL. I can get it a tad cheaper as I was told they could do me a better deal on shipping.

I'm closing in on the fact that I "may" end up purchasing in the UK, but not quite there yet. £141 for the same bit of kit still seems a tad extreme. If I could get K5 + K2 for <£650 + Free Delivery, I would be more tempted.

Sorry, my tight northern roots are properly shining lately!!!! lol.

Cheers,
Peter

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

If you trust the dealer, buy in the US. UPS, Fed-Ex or whoever will sort out all the formalities for a small fee (£10-15 -ish).

It's time manufacturers, distributors, dealers etc woke up to the fact that we're all in a post-google world!

--------------------
Dynamite with a laser beam...

i thought many retailers had a 'we will compete' type thing.

cant you call dolphin or someone and say you've seen the same product at DV but you want to buy from dolphin.?

Quote Steve Hill:

---

If you trust the dealer, buy in the US. UPS, Fed-Ex or whoever will sort out all the formalities for a small fee (£10-15 -ish).

It's time manufacturers, distributors, dealers etc woke up to the fact that we're all in a post-google world!

---

Yep, but before you buy direct, i.e. without a UK distributor, make sure you have all necessary figures at hand, customs etc...

--------------------
Samplecraze
Stretch That Note

Quote Steve Hill:

---

It's time manufacturers, distributors, dealers etc woke up to the fact that we're all in a post-google world!

---

Agreed!

I still don't understand "why" the prices are so much more expensive, here in the UK. Several other purchases I made recently were same price in UK, US & Europe, e.g. East West QLSO. I really am baffled to why one distributer can and one can't. At the end of the day, it's the same goods from the same manufacturer.

Cheers,
Peter

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

Quote:

---

With Visa, Mastercard this can be 1% or 1.5% of the transaction value. With Amex it's 5%.

---

My understanding is AMEX charges the retailer much more because their business model is that of a "Charge Card" as opposed to a "Credit Card". Visa and Mastercard generate a huge percentage of their revenue as a result of interest charges levied against card holders. Amex works on a model that expects the card holders balance to be paid in full every month which elimates a revenue stream that the other card companies enjoy .

In my own retail operations we advise clients that we will take their Amex card if they are willing to pay the additional charge associated with it. We do not promote Amex, display any decals or stickers, nor encourage its use as Amex shows no respect for the retailer [either in rates offered or in the time it takes to transfer funds]. We make it very clear that Amex is not a preferred choice but if it is all they have we will try to be accomodating.

In my experience, once a client understands the expense associated with Amex, they are more than happy to offer a different form of payment. We will even offer to extend a discount in the amount of the credit card charges against the purchase if they opt for Interac, Cash or Cheque.

It is always refreshing when a consumer is sensitive to these issues. When it happens, I believe its motivation for the dealer to offer additonal services or discounts. Afterall, business is always a two-way street.

--------------------
www.gpsystems.ca

It's not quite that easy. Yamaha for example won't allow any US retailer to ship goods to the UK (and probably loads of other countries). The goods, not made in the US, are obviously cheaper. It can't cost Yamaha appeciably more to ship them from the factory: there is simply no excuse.

Personally I just end up feeling I want nothing to do with a company which is so determinedly intent on mugging me, and buy a competing product instead.

One other thing to watch when buying abroad: mains voltages (and also the plug on the end of the mains lead!). But there's lots of info on importing gear in this thread.

--------------------
Dynamite with a laser beam...

Quote CdnBcn:

---

My understanding is AMEX charges the retailer much more because their business model is that of a "Charge Card" as opposed to a "Credit Card". Visa and Mastercard generate a huge percentage of their revenue as a result of interest charges levied against card holders. Amex works on a model that expects the card holders balance to be paid in full every month which elimates a revenue stream that the other card companies enjoy .

---

OK, so american excess don't charge their customers interest. But I imagine they do charge fees ?

And how does the AMEX card relate to for example switch/maestro, which doesn't involve interest ? When I pay with maestro is the retailer charged 5% ? (if so I shall avoid in future).

Quote Steve Hill:

---

It can't cost Yamaha appeciably more to ship them from the factory: there is simply no excuse.

---

There is an excuse, and personally, I think Yamaha are right to enforce this policy. What they are doing is protecting their dealerships outside the US -- Yamaha clearly value the service offered by their dealers around the world and are protecting them from the vagaries of exchange rates and different sales models that exist in the US and Europe. Yamaha is not alone in this policy either.

This topic came up recently on another forum I'm involved in and Chris Woolf explaiend the situation from a distributor's point of vierw: Ideally every manufacturer would probably prefer to keep each market compartmentalised because the exchange rates, tax regimes etc are different in every region and that is the only way to be fair to their distributors and customers while still making enough profit to stay in business.

But every customer would probably prefer total and utter market freedom to allow the cheapest possible purchases at any one moment -- especially now they can see different prices in different parts of the world on google.

But ... if 2 exists then half the distributors in the world would go out of business immediately since the ~temporary~ conditions of trade would prevent any useful competition. And as soon as the exchange rates etc see-sawed the positions would be reversed.

Sooner or later, 99% of all the dealers around the world would give up and walk away. Customers would have nowhere to see and try the products, no one local to offer support and service and the whole shebang would collapse.

In practice most customers -- especially those running a business that relies on these products -- want an impossible balance: a free-market price allied to a protectionist, compartmentalised local service and support
system. Such a business model doesn't exist.

It's also worth remembering that manufacturers are having to predict a good 6 months or more ahead of the game what exchange rates will be and what the import/export
duty situation will be too. With the US economy in the mess it is currently that is not an easy set of predictions.

Quote:

---

Personally I just end up feeling I want nothing to do with a company which is so determinedly intent on mugging me, and buy a competing product instead.

---

Like all accountants you are only seeing the figure on the bottom line, Steve. The dealership network has a value both to the customer and the manufacturer, and it doesn't seem unreasonable that Yamaha should try to protect that in this simple way. They aren't mugging you, they are protecting the ability of the dealers to make a living and thus serve both the manufacturer and the customer.

hugh

--------------------
Technical Editor, Sound On Sound

Quote Chris Edwards:

---

OK, so american excess don't charge their customers interest. But I imagine they do charge fees ?

---

Amex certainly will charge interest if you don't pay it off every month, but most people do treat it as a charge card rather than a credit card. Yes, they charge annual fees too, but these don't generate anything like the same levels of interest income that millions of maxed out credit cards do!

Quote:

---

When I pay with maestro is the retailer charged 5% ? (if so I shall avoid in future).

---

I don't think it is as high as 5% -- but the retailer will obviously be charged something (1.5 - 3% or similar) because the Maestro/Switch companies are providing the retailer with a service in handling the financial transaction.

hugh

--------------------
Technical Editor, Sound On Sound

Quote:

---

OK, so american excess don't charge their customers interest. But I imagine they do charge fees ?

---

Most charge card companies do levy an annual fee on their users which represents a significant portion of their revenue stream. Thay also generate copious amounts of money as a result of creative cash flow management techniques via their banking activities.

Quote:

---

And how does the AMEX card relate to for example switch/maestro, which doesn't involve interest ? When I pay with maestro is the retailer charged 5% ? (if so I shall avoid in future).

---

I cannot speak for the other cards you mentioned as I am not familiar with them [being in Canada] but I do believe Amex has established the model by which all "Charge Cards" [not Credit Cards] operates. Because the alternative charge card companies are much smaller I would assume their rates are more aggressive so as to establish an install base. Without a critical mass of users there is no incentive for organizations to accept their product.

--------------------
www.gpsystems.ca

Quote Hugh Robjohns:

---

Like all accountants you are only seeing the figure on the bottom line, Steve. The dealership network has a value both to the customer and the manufacturer, and it doesn't seem unreasonable that Yamaha should try to protect that in this simple way. They aren't mugging you, they are protecting the ability of the dealers to make a living and thus serve both the manufacturer and the customer.

hugh

---

I'm with Steve on this one - I don't buy into the protectionist theorem. Compartmentalised markets are there to serve the manufacturers - they wil (and do)charge what the market will bear. Their costs to manufacture are fixed. Transport costs from (say) China to mainland UK or US are roughly comparable, and the real varaibles come in the form of import duties. How, then, can it be that to buy something from the US, pay another set of shipping and import duties, plus VAT and a handling charge can still work out substantially cheaper than buying from a UK based supplier?

I have experience of companies being told that their advertised prices will cause them to find their supply being cut off - this is in the UK - yet they're actually competing with international pricing, from companies who have the buying power to tell manufacturers who are able enforce (illegal) price fixing in the UK to go stuff themselves if they make a similar threat to them.

The bottom line is this: If company A can sell product X at £10 ($20) in the US and make a profit, then to have a price fixed at £20 in the UK looks like (and is) mugging the punter. It's even more galling when product X is British and this happens (and it does)

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[url=http://www.facebook.com/pages/hifi-studios/117322741632389[/url]

Quote Steve Hill:

---

If you use a credit card, the retailer is charged a fee. With Visa, Mastercard this can be 1% or 1.5% of the transaction value. With Amex it's 5%.

---

This is a bit of a myth... the difference is normally nominal, but differs based on contract.

Quote Hugh Robjohns:

---

Quote:

---

When I pay with maestro is the retailer charged 5% ? (if so I shall avoid in future).

---

I don't think it is as high as 5% -- but the retailer will obviously be charged something (1.5 - 3% or similar) because the Maestro/Switch companies are providing the retailer with a service in handling the financial transaction.

---

I was sitting in an Indian restaurant waiting for a take away a few months ago and happened to be leafing through one of their restaurant trade mags. There was an advert in there from a card handling company offering rates of 1.5% for credit cards and a fixed fee (something like 30p) for debit cards. As I understand it, Maestro is Mastercard's name for a debit card so the fee for a Maestro transaction should be fixed.

Cheers

James.

--------------------
JRP Music - Audio Mastering and Restoration.
http://www.jrpmusic.net

Quote Hugh Robjohns:

---

There is an excuse, and personally, I think Yamaha are right to enforce this policy. What they are doing is protecting their dealerships outside the US -- Yamaha clearly value the service offered by their dealers around the world and are protecting them from the vagaries of exchange rates and different sales models that exist in the US and Europe. Yamaha is not alone in this policy either.

---

Hugh, I see this very clearly indeed. Protectionism in all its forms is always wrong, the consumer always picks up the tab, and the victim is usually someone in a developing country who has no organisation to lobby on his behalf - probably in the instant case Chinese workers. It's against everything the WTO was established to counteract (and which the US ignores at the slightest opportunity when there's some pork-barrel senator lobbying on behalf of six local jobs).

I can't support it. We have a global economy, and the cheapest available global price should be the price everybody pays.

Nothing else will drag the third world into anything resembling a decent standard of living.

And what exactly is it about "different sales models" that determines why Yamaha will let an impoverished US citizen buy say an O2R96 mixer for $9,200 (at Sweetwater), whilst a massively wealthy Brit has to pay $15,509 (at KMR, at today's exchange rate)?

I know a scam when I see one. And I'm not playing.

There's quite an interesting bit of campaigning journalism for SOS to get behind if you're in the mood.

--------------------
Dynamite with a laser beam...

Quote snipsnip:

---

Quote Steve Hill:

---

If you use a credit card, the retailer is charged a fee. With Visa, Mastercard this can be 1% or 1.5% of the transaction value. With Amex it's 5%.

---

This is a bit of a myth... the difference is normally nominal, but differs based on contract.

---

Well we've already had a senior manager from Arbiter say that they were asked to pay 4% so decline Amex cards... what exactly is mythical?

--------------------
Dynamite with a laser beam...

... and to continue. Musik Store in Cologne have in the last year advertised a €112,000 Bosendorfer grand piano at €44,000. They also offer Yamaha pianos - the prices are not listed on their website, but I am invited to ring for a quote. Do you want to place any bets that they are cheaper than UK prices?
(Obviously Yamaha can't ban one EU citizen selling to another however much they might wish to).

If the sole justification for the shameless price fixing which is going on is, as you suggest, to protect dealer networks against bankruptcy, then I go back to my earlier statement: we live in a post-google world. Bye-bye dealers, it's been nice knowing you. The future belongs to Musik Store, Thomann and so on. And fair play to some UK players like Digital Village and Dolphin who are trying to compete on those terms, and are not stuck in some time warp.

Yes, it's mail order box shifting on a massive scale (although they will welcome you with open arms if you want to visit them). But that works for most people most of the time. I am happy to buy most stuff for the studio without visiting a shop or trying it out. I rely on recommendations, forums, discussions with clients and visiting engineers/producers, reviews in SOS to decide what I want - far moreso than trying to "test" (ahem...) a Neumann mic in a crowded store in the West End on a busy Saturday full of kids trying out guitars and synths.

This is the world as it is, not as Yamaha want it to be. You can't buck the market. You deliver what your customers want or you go bankrupt.

That's my kind of capitalism.

--------------------
Dynamite with a laser beam...

Quote:

---

This is a bit of a myth... the difference is normally nominal, but differs based on contract.

---

I disagree with this comment to the nth degree. The best Amex contract available [which very few get] will charge the retailer 3.5% of the total charge [taxes et al : so approx 4% + of price]] wheras the better VISA, and MasterCard contract will offer 1.70% and 1.40%, respectively.

There is nothing nominal about a 2% premium to be paid by the dealer for no added benifit. 2% is a very significant amount of money when you consider the high percentage of purchases that are completed by Credit/Charge cards in this industry.

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www.gpsystems.ca

fair enough.. i work for them.. but not in merchant so maybe im wrong.

Quote Steve Hill:

---

We have a global economy, and the cheapest available global price should be the price everybody pays.

---

How can that possibly work? Even on the most simplistic level, shipping a full container of product from, say JApan to the US (because the market is larger and can sustain more sales) will inherently provide a lower cost-per-unit than shipping a half full container to the UK.

I'm no economist, and I realise I may be showing my ignorance here, but I can't see how the lowest possible price can be offered to everyone on the planet. I can't even see how you can have a single unified global price while we still trade in a wide variety of currencies in which their relative values float. Over the last four months a dollar has been worth roughly between 125 and 107 yen (17% variation), while the pound has bought between about 252 and 220 (14% variation). So if each country buys the product in Yen, the equivalent retail price will vary anyway...

Quote:

---

And what exactly is it about "different sales models" that determines why Yamaha will let an impoverished US citizen buy say an O2R96 mixer for $9,200 (at Sweetwater), whilst a massively wealthy Brit has to pay $15,509 (at KMR, at today's exchange rate)?

---

I dare say Sweetwater sells a good deal more to start with, because its market is obviously far bigger than KMRs. It may well be that the warehousing costs to store the product are also vastly different. The cost of staff to support and sell the product may alwo be very different.

Quote:

---

I know a scam when I see one. And I'm not playing.

---

Fair enough. My only real concern over this 'the grass is greener in the US' mentality is the immense and rapid damage it could potentially do to the UK industry. If it becomes commonplace to buy from the US because it's cheaper, then the UK dealers go bust. It's not as if they are all swanning around in luxury cars -- most of those I know well don't make that much of a living at it.

And then there is the whole global warming issue. It can't possibly make sense on that level to ignore products already in the UK, and instead have the same thing shipped half way around the world, just to save a few quid! It's just bonkers.

Quote:

---

There's quite an interesting bit of campaigning journalism for SOS to get behind if you're in the mood.

---

There is -- but not for me. I clearly know nothing about the subject matter But I'll certainly mention it at the next planning meeting as a possible feature for someone.

Hugh

--------------------
Technical Editor, Sound On Sound

My Considered opinion, as a former retailer, and former employee of a distributor , in this industry, is that Hugh is bang on the money.

sadly though Steve's position is far from unique, even though IMHO misguided and unrealistic, and much of the damage Hugh fears, has frankly already been done.


the next time ANY of you moan about not being able to easily go and audition equipment of any shape size or description, even remotely locally ,or indeed anywhere outside London, pat yourselves on the back and congratulate yourselves on googling the supply sector of our industry to an early grave.

Don't get me wrong,
I'm not keen on paying over the odds for anything.... but to expect te lowest global common denominator to be applicable is simply denying the realities of life and business.

oh, and BTW, the Uk is a LOT further than the US is from China by sea , no matter which way you go...




even Via Suez, it's roughly 10K nautical miles (9677) via Suez , nearer to 14K if you go by way of the cape...

china to US mainland is only 5K nautical miles. (and I mean mainland, Not Alaska, which is a mere 3400 )

so overall, how can it NOT cumulatively cost more to get here?? especially given the differential in market size and unit-volume costs.

and local market factors, like salaries and taxes...

--------------------
if you don't know who i am, i aint gonna tell you.

Well I can certainly agree that avoidable carbon miles is a problem. But it should not be.

I don't want to buy from the US. I want to buy Yamaha products from my friendly local box-shifter of choice at the same price as a US customer .

I don't buy the argument about half full containers. I can (but for Yamaha's ban) get the 02R96 from Sweetwater shipped to my door by Fed-Ex or UPS or whatever and still pay far less than any UK price. UPS etc are in the business of filling up containers efficiently. That's what they do.

I'm asking Yamaha to send stuff from (probably) China on the same terms. And let's not pick on Yamaha only: why are Sennheiser mics made in Germany cheaper in the US than in the UK? The e914 is $313 in the US and $474 at Digital Village, a 51% mark-up.

Shipping costs are a red herring. And you might also pause to think about the costs of getting the shipped goods from the coast to (say) Phoenix once they have landed in the USA. [Canada has the unworthy distinction of the average item on your plate travelling 5,000 food miles to get there, a world record].

Yes, exchange rates vary. Importers and exporters have learned to deal with that stuff during the last couple of millennia (and, now, can hedge quite effectively). It's not an obstacle to free trade. Regardless of how the yen moves against the dollar, the price of Japanese goods in the UK is governed by how the yen moves against the pound. The existing dealer network offers the consumer no protection against that (nor should it).

Let's be clear, that 02R96 is 69% more expensive in the UK. I agree our starving retailers aren't getting much out of it. But someone is, and it's wrong.

Max, welcome. I can't stop the tide. I won't even try. I said in my previous post I no longer even want to audition stuff... it's just not necessary, and nobody's got proper facilities for doing so anyway, in any meaningful way. I love cheap box-shifters. The world is going to vote with its feet, if it has not already done so. And some people will have to find new careers.

It was ever thus. A piece of me is nostalgic for old style High Streets before the supermarkets killed them all, but I would never defend naked protectionism and artificially supporting high prices at the consumer's expense in order to preserve the status quo. Efficient markets respond to consumers, they do not dictate to them. That's economics 101, and the businesses which don't learn that learn bankruptcy 101 instead.

--------------------
Dynamite with a laser beam...


Edited by Steve Hill (07/12/07 05:26 PM)

Quote Steve Hill:

---

I no longer even want to audition stuff... it's just not necessary, and nobody's got proper facilities for doing so anyway, in any meaningful way.

---

These days we rely on the SOS reviews

I guess the price paid will be what the local market will stand.

Sennheiser mics are that price here because they can sell at that price. If nobody bought them at that price the price would have to go down.

There are items that sustain a world market value. Not that I will actually probably ever buy one, but I often check out the price of Rolex submariners and Omega Semasters whenever I pass through a country (maybe I'll treat myself when I retire! ) I have noticed that there really isn't much difference in the price offered between Hong Kong*, Zurich, Nice, Chicago, Seattle, or Beijing.

*OK I have been offered much cheaper 'rolexes' in Hong Kong, but somehow I suspect they might not work very well!

--------------------
New album 'Fantasy Bridge' available now!
Making of Fantasy Bridge Diary

Quote MarkOne:

---

I guess the price paid will be what the local market will stand.

---

That's what we're supposed to believe. But there's only one, global market now. The emperor's got no clothes any more.

--------------------
Dynamite with a laser beam...

Hi Steve - I think it could be a worse case scenario that the product you're quoting is 69% more expensive in the UK, but I suppose it is still worth mentioning..

On a general retailing level, anyone visiting the US gets quite used to prices in $ being the same or similar to prices in £ - not an excuse, but a fact.

The only country that I know of where price fixing is the norm is the US where they have MAP (Min Advertised Pricing) set by manufacturers - basically a lower SRP that all dealers sell at.

We have to all embrace competition to survive - it's what makes manufacturers come up with better value packages for example, and within reason I think you'll find that the internet will lead to closer pricing between currencies - the really weak dollar does make other countries look un-competitive, but this is not unique to our industry.

Cheers

Steve Parker
Music Technology Manager
Arbiter Group

Quote:

---

Steve Hill:
A piece of me is nostalgic for old style High Streets before the supermarkets killed them all, but I would never defend naked protectionism and artificially supporting high prices at the consumer's expense in order to preserve the status quo. Efficient markets respond to consumers, they do not dictate to them.

---

(My emboldening)

BBC News Link: Supermarket firms Sainsbury's and Asda have admitted that they were part of a dairy price-fixing group that earned about £270m extra from shoppers. Now that's an efficient market!

Competition in a fairly matched market with many well matched players is good for consumers - competition in a market where some elements are able disproportionately to employ positions of economic strength generally is not (whether local or global). Monopolistic abuse of market position is rarely a route to best consumer service. Without getting into the complex economics of a global market / international supply chain / local conditions / profiteering gits / protectionist market arguments, the box shifter, lowest common denominator, retailer is fine for consumers with lowest common denominator needs/expectations; for those who value the expertise and service of a good specialist service, it's depressing, if slightly inevitable, now that music technology and the businesses which depend upon it and upon which it depends are just part of the 'consumer electronics' and retail commodity markets rather than professional/specialist areas making a product regarded as a bit of a luxury item that has to be paid for. To the majority of consumers music now is more or less valueless so I suppose it's no surprise that the tools, facilities, services and skills to make it are going the same way.

Quote:

---

I am happy to buy most stuff for the studio without visiting a shop or trying it out. I rely on recommendations, forums, discussions with clients and visiting engineers/producers, reviews in SOS to decide what I want - far moreso than trying to "test" (ahem...) a Neumann mic in a crowded store in the West End on a busy Saturday full of kids trying out guitars and synths.

This is the world as it is, not as Yamaha want it to be. You can't buck the market. You deliver what your customers want or you go bankrupt.

---

So where does that leave people like me? It's far from the world I, as a customer, want. You may not consider it important to try equipment or have a local(ish) source of backup and after sales service on expensive items of equipment upon which your livelihood (as opposed to a hobby) depends but I do.

Apart from which, I like being able to talk to a distributor or retailer whom I know personally and with whom I've established a good working relationship; who knows me and my needs/likes/dislikes; who's able to tip me the wink if something new that might interest me comes along or is about to appear, or drop a discrete warning if something I'm planning to buy is about to be superseded by a far better model; who can snag me the occasional 'special' from the factory, etc.. I like being able to call them and have them ship new bits of gear to me so I can try them out to assess their suitability for my needs and how they fit into my working methods and equipment setup rather than those of a reviewer or some people I don't know on an internet forum.

Don't get me wrong, I use forums and reviews all the time as references and starting points for further investigation but I'm not about to blow a few thousand quid or more on mics/outboard/whatever on the basis of something I've read, or some dodgy MP3 samples on a forum somewhere. I need to hear/touch/examine equipment before I buy. I'm far less inclined even to consider it if the only source of the item in question is a box shifter in a foreign country who's going to flog me x quantity of catalogue no. xxx at whatever knockdown price they're doing that week but who doesn't know anything about the stuff they're selling beyond what it says in the brochure or what they were told on the half day sales course and isn't going to know me from Adam when I call up a fortnight later because it's stopped working and I'm in urgent need of a repair/replacement and/or a loan item to cover impending work.

The Euro/US/wherever box shifter is all very well for saving a few quid on an initial purchase but they're not interested in my problems as I'm just one of millions of faceless customers all over the world/can't help even if they want to because they don't know my local market or situation so can't refer me to someone locally who might be in a position to get me out of a hole (assuming that there still is anyone left locally with the ability to help, who hasn't had to find another career after seeing their service based business wiped out by the box shifters!). The inital saving could be completely blown if, due to equipment failure and non-existent/consumer level support, I have to spend a load of cash shipping a faulty item away for repair/hire a replacement item/waste time phoning all over the place to sort a problem/in the worst case lose a recording because of it.

I guess that I like it when people offer me the level of professional service that I try to offer my clients and in the same way that I don't expect/no longer respond to my clients/potential clients trying to beat me down on price below the point at which it's commercially viable for me to work, I don't mind paying a reasonable premium to a dealer who offers the service I need.

Sadly, in a world of nothing but box shifters, in the eyes of the consumer, everything is devalued, from the product sold, to the services which employ it to the things they create. Prices at all stages are driven ever lower, expectations are lowered and quality is sacrificed to lowest common denominator consumerism.

Obviously this is a worst case and there's a balance to be struck but only so long as it's possible to choose alternatives. When these alternatives have been lost to the 'consumer choice' of 'free market capitalism', and all that's left is a global market offering a globally standardised McDonalds' level of mush, is the world a better place for so may people getting what they asked for?

Bravo Mon Capitane

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if you don't know who i am, i aint gonna tell you.

Blimey.

Quote Steve Hill:

---

Let's be clear, that 02R96 is 69% more expensive in the UK. I agree our starving retailers aren't getting much out of it. But someone is, and it's wrong.

---

That example is a bit distorted because the sweetwater price excludes sales taxes and because KMR are about £500 more expensive than the cheaper UK shops. If you use the DV ex-vat price the difference is more like 36%.

This still seems like quite a big difference though. It might be something to do with the volume of products sold and prices of competing products, as the difference for the 01V96 is more like 13%.

Can anyone be bothered to comparison shop a whole studio?

... to keep this simple, and I do understand import / export 'theories' to a certain extent, but WHY does software from Germany (closer to the UK than the US) cost more? Surely an order could be placed direct from NI and they will ship it, at cost, to wherever the destination need be. Wouldn't that be simpler, fairer and better for the customer, cutting out the middle man who seems to be causing the 'price war' problems?

NI seem extremely firm with their prices online, yet distributers, suppliers and stores of NI products vary their prices depending location. I don't understand the economics of this.

If this shipping lark, $ v £ v Yen stuff, etc is all true, how come I can purchase EWQLSO for the same price, wherever my location and delivered to my door? After all, it's just like Komplete, i.e. software bundled in a box.

Cheers,
Peter

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

Quote markhodges:

---

That example is a bit distorted because the sweetwater price excludes sales taxes .....

---

One also has to factor in the stranglehold that the major US franchises have over manufacturers and their ability to dictate US prices and negotiate bulk discounts due to the sheer size of the market and their ordering power. Basically, the buyers at these big franchises deliver an ultimatum along the lines of "We like the product but don't want to sell it at that price. If we can sell it at $xxx, we'll order x00 pieces otherwise forget it"! What's a manufacturer to do? These franchises own the market and if a manufacturer can't get product placement at them, they may as well forget it and kiss that product goodbye even on the global stage. And if the likes of GC are seen not be carrying a particular product, sure as hell the others won't touch it either (and there's no money to be made from the smaller 'mom and pop' stores there either). And that has knock-on effects into other market areas as well. So the manufacturers' hands are tied! Sometimes, other market areas benefit if the manufacturer decides to apply that new pricing to the world market but not always.

And if the manufacturer does apply that new price point worldwide, this can affect - say - UK dealers because the margins are so low, it's hardly worth handling the thing ... getting staff trained, holding and storing stock, advertising, occupying shop floor space (as well as dealing with faults, repairs, returns, enquiries) and so on for a small %% markup.

It really isn't as simple as "It's $xxx in the US therefore it should be the same price everywhere" and whilst it's possible to Google the best price and order from anywhere (notwithstanding shipping, p&p, duties, taxes, mains voltages and plugs, documentation, etc.), what's to be done if there's a fault or some other problem? And what if a product needs an approved dealer to fit some accessory - should your local dealer do that when you ordered it from Idaho or Taipei (assuming your local dealer still exists)? Or do you do it yourself? If so, what happens if you screw it? Who sorts that out?

There is so much about this 'globalised' business model that just doesn't work on a practical level.

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Website / Music Lab Machines / Blog

I agree with everyone. Especially OVU. And I guess if you're in the market for say a Cadac desk you're going to get service, one way or another.

I'm simply pointing out that what a lot of people see as the ideal - namely continuing with the status quo model - is unsustainable. The "dumbing down" of so-called pro audio started with its democratisation into something anyone could do in their bedrooms (and hooray for that).

Professionals learn to live with the fact that "boxes" may just need to be swapped out. If say the studio computer goes down I've got another ready to slot in. If my AD converters go, I've got another 24 channnels on the shelf. And so on. Even if my mixer goes down, I can record 18 or 20 mics direct into the computer through decent pre-amps. And I could do a mixdown in the box with help from a Mackie Universal Control. Everything I do is built on the possibility that I might have to live without something - anything - in a real life crisis, and still get the job done. And I'm sure a true professional like OVU does exactly the same.

If I really want to try something out before I buy (and I do, sometimes) I'll go to a mate's studio where that "box" exists - not a shop. Or a client engineer/producer has brought something into the studio and impressed me. Or I'll listen to Max, who's heard pretty much everything, and who supports my studio on a professional level, and often tips me off about something I might like to consider. (Yes, I pay Max for advice - and that may be the way we have to go if you want advice as well as cheap boxes).

And I venture the modest thought that such advice is worth a tad more than anything I'm going to get from some functionally illiterate 17 year old at Turdkey, assuming he can take his iPod buds out of his ears for long enough to notice I might actually be a customer looking for some service.

Some of those box shifters can be life-savers too - let's hear it for the likes of Canford, Studiospares and CPC who have got stuff to my door on guaranteed next day delivery in the past to dig me out of a hole. How many retail outlets are you going to trust to have something in stock when you need it in a hurry?

There's a precedent for what's happening in the UK. Look at the motor industry 10 years ago. Entirely based around a network of authorised dealers artificially inflating prices and sustaining "rip off Britain" tabloid headlines. So consumers got smart and starting buying their cars in Germany. For a few years there was a bit of a backlash with people like Rover trying to defy gravity and refusing to supply RH drive cars to Germany (silly asses, wonder what happened to them?), but the consumer prevailed, and the old order was, essentially decimated.

OVU, on a point of order, the fine on supermarkets for "overpricing" today still did not stop them decimating the High Street. All that fine means is they failed to decimate the High Street sooner, and with more brutality. The regulator has punished them for not delivering the coup de grace to more grocers quickly enough! (And rightly so).

The consumers are going to win this one - be under no illusions. It's only a matter of timing.

--------------------
Dynamite with a laser beam...


Edited by Steve Hill (07/12/07 11:02 PM)

Quote Steve Hill:

---

Professionals learn to live with the fact that "boxes" may just need to be swapped out. If say the studio computer goes down I've got another ready to slot in. If my AD converters go, I've got another 24 channnels on the shelf. And so on.

---

Er... so where is the advantage of saving $50 buy buying something from the US at a bargain price, when you apparently now have to buy two of them (one as a reduandant spare) in order to protect your business?

You seem to be saying that it is right, or at least inevitable, that the lowest common international prices should prevail, and that the demise of the local distributor/retailer is just collateral damage. And then you happily accept the inherent side effect that you then need to double up on the equipment inventory because you no longer have any local support.

That doesn't seem to make any kind of long term business or financial sense; there really is only the immediate short term gain of, 'Yippee, I just saved myself $50' As I said earlier, this is the kind of widespread management accountant mentality that has overseen the complete destruction of pretty much everything I once held dear! And it can not work in the long term without destroying eveything craft-based in its path. Worse still, by the time people realise the damage has been done, it will be way to late to repair any of it.

Quote:

---

(Yes, I pay Max for advice - and that may be the way we have to go if you want advice as well as cheap boxes).

---

Again, this is another hidden cost of your saving. You save $50 on the purchase price, but you spend the same, or more, on expert advice and support which you would previously have got for free from your professional dealer (and I'm not talking national bedroom box shops here). I'm still at a loss as to where the real saving and advantages are in this brave new world you are championing.

Quote:

---

Some of those box shifters can be life-savers too - let's hear it for the likes of Canford, Studiospares and CPC who have got stuff to my door on guaranteed next day delivery in the past to dig me out of a hole.

---

These aren't really box shifters though, are they -- not in the same league as Sweetwater or Thomann. They can't be because they'd never survive. Their only stength is that they supply the more specialist, fiddly odds and sods that people are still preprared to pay a decent margin on. And yet even these are already being squeezed and will eventually be destroyed by cheaper overseas international box shifters.

Quote:

---

The consumers are going to win this one - be under no illusions. It's only a matter of timing.

---

I don't doubt it. The bedroom hobbyists will think it's great. The professionals will gradually die out, and another craft-based industry will have been destroyed. We always get what we deserve in the end...

Hugh


--------------------
Technical Editor, Sound On Sound

Quote Steve Hill:

---

Professionals learn to live with the fact that "boxes" may just need to be swapped out. If say the studio computer goes down I've got another ready to slot in. If my AD converters go, I've got another 24 channnels on the shelf. And so on. Even if my mixer goes down, I can record 18 or 20 mics direct into the computer through decent pre-amps. And I could do a mixdown in the box with help from a Mackie Universal Control. Everything I do is built on the possibility that I might have to live without something - anything - in a real life crisis, and still get the job done. And I'm sure a true professional like OVU does exactly the same.

---

Good for you and good for every pro out there in that privileged position. You are extremely lucky. Most others aren't in that position, however....

The semi-pros who rely on the extra income generated by gigging or doing little recording sessions, whatever, don't have those options. If something goes down, they can be f'cked because they don't have alternatives to wheel out as a replacement ... but their semi-pro status can be damaged if they have to cancel gigs/sessions especially if they are trying build a reputation with a goal of being a professional.

You appear to speak from a very privileged position Steve. By your own admission, your place is built upon the earnings you received as a well paid city lawyer and good luck to you. I have no problem with that. But you also have some fairly high profile contacts to bounce off and inroads to places to assess gear. In view of that, you can afford to order on-line with impunity - you have Max to advise you, you have people into your place bringing gear you can try out, you maybe even have a relationship with some manufacturers such that you can get gear in to assess and soak test to see whether you like/want/need it. Whatever.

Most people don't have that luxury. They need a shop to go and try things out (even if the environment is less than ideal). They also need a shop to fall back on if something goes wrong. And the purchase they make can represent a major part of their income either by way of saving or by way of finance and they can't afford a backup. You speak nonchalantly of being able to handle 18 or 20 mics through decent pre-amps if your mixer went down. Christ! For most people, that's the stuff of dreams!

Sorry but there's a smug hint of ivory towers and 'let them eat cake' in your proposition.

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Website / Music Lab Machines / Blog

Quote Stephen Parker:

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The only country that I know of where price fixing is the norm is the US where they have MAP (Min Advertised Pricing) set by manufacturers - basically a lower SRP that all dealers sell at.

Steve Parker
Music Technology Manager
Arbiter Group

---

Steve, you must be walking around with your eyes shut and ears blocked - point me at a UK dealer offering, say, the competitive upgrade to Cubase 4.1 at anything other than £379.00 - you know, the same one that Thomann can flog at £306.00.

And then tell me that reps don't have "conversations" with errant dealers who advertise kit at prices that don't fit with "premium" brand expectations.

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[url=http://www.facebook.com/pages/hifi-studios/117322741632389[/url]

Quote Steve Hill:

---

Quote snipsnip:

---

Quote Steve Hill:

---

If you use a credit card, the retailer is charged a fee. With Visa, Mastercard this can be 1% or 1.5% of the transaction value. With Amex it's 5%.

---

This is a bit of a myth... the difference is normally nominal, but differs based on contract.

---

Well we've already had a senior manager from Arbiter say that they were asked to pay 4% so decline Amex cards... what exactly is mythical?

---

The mythical part is that a senior manager from Arbiter
and a lawyer/accountant previously employed by a
multinational accounting firm don’t know that when you are
quoted 4% fee by American Express it means that you will
be charged 4% in fees. And if you were quoted 1.5% for
Visa/Mastercard transactions you will be charged something
like 3.0-3.5% in fees. The reason for this is that
Visa/Mastercard will have all sorts of surcharges, etc.,
but AmEx will charge you 4% and that’s it. I don’t expect
you to believe me. But please do yourself a favor and ask
somebody dealing with Visa/Mastercard and American Express
to show you their monthly statements. I’m sure being an
accountant it will be a trivial exercise for you to figure
out what really is going on.

--------------------
Resistance - Liberty - Death to the oppressor

Quote Steve Hill:

---

the fine on supermarkets for "overpricing" today still did not stop them decimating the High Street. All that fine means is they failed to decimate the High Street sooner, and with more brutality. The regulator has punished them for not delivering the coup de grace to more grocers quickly enough! (And rightly so).

---

I am glad to see that you are in favour of monopolies decimating long-standing high street businesses (and reducing customer choice) and all that that implies to the employees of those enterprises (i.e. potential long term unemployment ... unless they toe the line and seek minimum wage shelf stacking or till duties at the emporia that forced them into this ignominious situation). Yay! Long live Sainsbury's, Tescos, et al and their exploitation of farmers and workers worldwide for selling their sub-standard, bland, chlorinated shite to a price point (not to mention the COLOSSAL wastage of perfectly good food that is rejected and thrown into landfills because it doesn't meet their 'shelf appearance' criteria ... or thrown out if the sell-by date is exceeded ... assuming, that is, they don't use immigrants living on the edge of legality to re-sticker the sell-by dates) not to mention the air miles their produce generates - unless you prefer battery chicken flown in from Vietnam to local produce?.

I am surprised you favour such a business model - I know you don't give a fig about the British workforce (given your disdain for the sacked workers at Cadbury's in a previous OT thread as Cadbury's moved production to Poland) but the environmental aspects about which you are so passionate?

Or do you have a special eco-friendly source for your Christmas beef wellington that we plebs are not aware of?

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Website / Music Lab Machines / Blog

Quote hollowsun:

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Most people don't have that luxury. They need a shop to go and try things out (even if the environment is less than ideal).

---

Why don’t just buy whatever you like from a box-shifter and return it for a refund if it doesn’t work for you?

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Resistance - Liberty - Death to the oppressor

Quote Hugh Robjohns:

---

Again, this is another hidden cost of your saving. You save $50 on the purchase price, but you spend the same, or more, on expert advice and support which you would previously have got for free from your professional dealer (and I'm not talking national bedroom box shops here). I'm still at a loss as to where the real saving and advantages are in this brave new world you are championing.

---

It's the way of the world. I am just reporting it - not condoning or condemning. The cost of service used to be included in the goods, which were higher priced. The craft industry whose passing you lament was fine: as long as you had a million quid to equip a studio.

That massive structural change to the industry, driven by cheap IT, is the reason most members of this forum are here, and it's why SOS exists (and why say Studio Sound no longer exists). And overall, this change is a good thing: it's made high quality recording accessible to literally millions of people who otherwise would have had to pay for studios or go without. That's a good thing. For hobbyists, professionals, music, and indeed manufacturers and distributors and dealers who hav ehappily sold into this vastly expanded market.

I'd suggest it's you who wants to have your cake and eat it, not me, and not the liberated millions.

The consumers voted long ago for cheap prices. And the rational response by suppliers to that is that service is no longer included in the price - whether you want to use Amex at DV, or whether you want genuinely expert advice on what to buy, or whether you want any support - any support at all - from Apple and a growing number of other suppliers, the deal now is that you pay for it.

Yes, there is redundancy in the systems in my studio. How many threads have we had about say live recording advising that you record to at least two machines, possibly three? Dozens! I'm not talking from a position of extreme privilege or bloated plutocracy. I'm running a business with real life clients who might - in one case this year - have flown in from Virginia for three weeks, committed expense to pre-booked session musicians, and expect things to work. Otherwise they could quite properly look to me to reimburse the thousands of pounds they have wasted, as well as refuse to pay me.

A hobby/project studio can close for a few days if something critical blows up. I can't. And I'd expect no less from any professional studio. (It's also one of the reasons why I get mildly irritated when people assert that you can have a "professional" studio and get change out of £5,000. It can't be done).

Edited by Steve Hill (08/12/07 08:32 AM)

... by the way, my AmEx is a Credit Card, used and paid juts like a regular Visa / Mastercard / etc, NOT a Charge Card.

Funnily enough, when I was in LA last year, several stores would not accept my AmEx card, which was hilarious.

P

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Composer, Producer, Sound Designer
www.universal-sound-design.com

I think that as the box shifters target the price conscious consumers there will still be room for a few places that compete on quality of service or cater to the 'pro' market.

It's happened with supermarkets vs butchers & greengrocers. My local butcher is apparently thriving, with a queue out of the door every saturday, because they sell high-quality organic meat along with a range of sauces, condiments, pies and home made sausages. We also have a nice deli / greengrocer, and there are dozens of small pie & sausage producers springing up.

Just to put in my 2 pence.

Steve mentions about lots of hobbyists being on here, and I am one of those.

I bought my first synth and sequencer 15 years ago, and haven't really had the money to expand since.I bought the synth from X-music, and didn't get much help from them, and have had similar experiences from Turdkey and GAK.

I have never thought these outlets offered particular support for hobbyists, so don't think much has chaned over the last 15 years.
I had a very good experience at DV, but there was more about the person who served me than the ethos, I had a very bad experience at a different store.

I view "box-shifters" as a bit like sellers of OEM stuff. You either buy it because you know what you are doing, or you buy it because it is cheap. I buy OEM stuff because I know what I am doing, I buy stuff from "box-shifters" because I can't afford more, I read reviews, and ask questions on here, then, as my dad would say "I pays my money and takes my choice".

Would I pay an extra 10-20% on the price of my kit for more professional support - no, because I can't afford it.

I also accept that you have to protect the market. How much does it cost to have a 100,000 sq ft warehouse in India, fully staffed, along with people mannning the phones compared with the same set-up in London?

If you want/need a presence in your country, you have to pay the going rate for the staff.

Not sure what my point is

--------------------
Is thinking about starting a new project

Quote Steve Hill:

---

The consumers are going to win this one - be under no illusions. It's only a matter of timing.

---

Actually they will lose - because lowest price destroys everything else.

I'm with 0VU and Hugh on this.

--------------------
John - Sound-Link ProAudio
President - Federation Internationale des Chasseurs de Sons

John, it's unfair to put you personally on the spot, but assuming Sennheiser are happy with the margins they get selling to US customers, why are they not happy to sell to me at the same (lower) price?

Are they afraid the management will be subjected to extraordinary rendition and end up in Guatanamo Bay unless they are especially nice to Americans or something?

I like Sennheiser. I've got 14 mics with the name on, lots of headphones, and a similar number of mics by Neumann (same company). I am wholly sold on buying quality products.

Quality and fair comparative pricing between different markets - especially when any fool can google the comparison in 10 seconds - are not mutually exclusive. And if the googler feels he's being ripped off having got that information, he's going to draw conclusions about which supplier companies he likes.

I have heard nothing, ever, from any supplier justifying these differential prices, other than frankly incredible tosh about "different market conditions" which would not stand up to scrutiny by a first year audit student.

And I think we have a right to know.

--------------------
Dynamite with a laser beam...

Why can't suppliers think of the UK (or anywhere else) as an extension of US sales?!?! If the US is their main source of orders / income then surely the UK sales, at the same price, would simply be extra revenue? Yes, we're a LOT smaller, but this doesn't justify us having to pay more (often double) to compensate for this.

I've yet to read anything viable or something to convince me otherwise that UK prices are fair.

Cheers,
P

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

Well, I've just made a decision and bought Komplete 5 + Kore 2 from the US, literally minutes ago, from a store I've used in the past. It came to £475, which includes international shipping and this is £225 cheaper than the BEST UK price. I'm anticipating import tax and duty to be < £75. Fantastic

Cheers,
Peter

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

VAT will be 17.5%. Import duty is 0% according to this:

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.porta l?_nfpb=true&_pageLabel=pageTravel_ShowContent&id=HMCE_PROD_009989&propertyTyp e=document

I've just been checking the prices on a few things. Some made in the e.u. stuff i.e RME cards & converters, is actually cheaper to buy in the UK by as much as 18%. So it works both ways.

Edited by Hugh Robjohns (08/12/07 09:36 PM)

Quote Steve Hill:

---

why are they not happy to sell to me at the same (lower) price?

---

because it is a lower price?

Companies get what they can. Some attempt to get a higher price by claiming they give better service (and therfore appeal to a small section of the market). Some might actually give a better service - but I haven't found one yet.

J

For me it's really just the some of the greedier US and big Japanese manufacturers...
I just haven't bought their goods in the UK because it just *feels* like I'm being shafted. That's after comparing pre-tax prices and seeing 20-40 percent being creamed off, and yet some products (of the same type) are directly comparable.
I will buy Euro gear here instead of US or Jap stuff quite often though unless unavoidable.
This country's too expensive to begin with - Too many dumb, fat, bone-idle exec's poncing around riding the mug-punters. I do however fully support those who are pulling their weight.
If someone's losing my custom, they aren't doing their job or they're paying the *longterm* price of allowing our economy to become what it is. Harsh, but that's business. Boohoo, they wouldn't give a s*** about us - their rules.

Seems to me that the practise Steve reports of having a broad set of fallback options is pretty much what every professional has done for ever. It also seems to me that such people have never bought big ticket items on the high street, ever (Hell, even I don't).

If you build a relationship with a real pro audio dealer (NOT a highstreet store, these people live on industrial estates not shopping streets) you will probably be getting well below list price on reasonable size orders. On serious PA gear, I normally figure that if I am buying a few grands worth it will be at around 30% off list. The other side is that they also get my orders for cable and connectors (and while I don't expect to be ripped off), I don't quibble over the price of the small stuff. This also makes for someone you can ask advice of (And who is even sometimes good for some work).

Now, in the MI market (which has recently been very much highstreet based), the mail order box shifters are having a devastating effect, but it is really a continuation of what the advent of the sound controls/turnkeys/digital villages of this world did to the single area specialists a few years previously (You try to find a specialist guitar shop (as in has someone who really knows how to set one up) these days, they exist but not on the high street). The fact that these places will be pushed into moving to industrial estates and into becoming somewhat specialist is IMHO no bad thing (The saleschildren they employ are seldom good sources of advice).

As to the cost of having the fallbacks, a lot of those can be replaced by some creative engineering and a fairly small spares inventory. For example last time I suffered a major desk power supply fault (it happens, in this case to both main and backup within 2 minutes (Different faults when I had them apart, how unlikely is that?)), the temporary fix involved two car batteries and 5 PP9 9V batteries, +-12V, +45V (close enough) and I was back in the game in under 20 minutes from when the blue smoke appeared.
This does of course require the appropriate amount of engineering smarts, but it is a trade off, you can afford to run with less support from your dealer if you know more stuff and have a well equipped 'tronics workshop (and have better contacts), but if you don't then you better have that relationship that costs the extra 10% (And it is IMHO worthwhile anyway).

Now none of this directly relates to the 'interesting' international pricing (or at least to differences in ADVERTISED price - often not the same as you pay), I bet the differences are much smaller in many cases if you go to a real pro audio place.
In point of fact the canonical German box shifter actually prices out as rather steep on some of the more expensive stuff when compared to what a local dealer will sell it for (by over a grand on ~14Ks worth of mixer), so it is not always a case that the box shifters are cheap.

Regards, Dan.

--------------------
Audiophiles use phono leads because they are unbalanced people!

FWIW I just got the bill from DHL for VAT on some stuff I got in from Malaysia earlier this year - 17.5% vat nad no import tax.

Again this was on a relatively inexpensive shipment of small electronic parts, but it does make it evident that typically we are NOT going to get shafted on VAT or improt duty provided we play the game with C&E and VAT chaps.

Bear in mind that you would be paying the VAT anyway & so if what you are buying still works out cheaper, howe can it NOT be a good deal?

I have a good friend who is involved with DV and several others who are employed there and they all claim to be making very little in the way of profit on most of the "everyone wants one" lines.
Typically around 5% gross.
So who IS making "all that money"?
I suspect that a lot of the differences between USA and UK are down to scale - 123 Musicians Friend and the other BIG players have monumental buying power even compared to the likes of DV/Turkey/&c.
And lets not forget how many US major players have gone to the wall or been swallowed up by the biggies lately.
Its all about the same business model as the Tescos of this world.
And of course up to a point the average consumer wins in terms of price, but not necessarily in the lkong term, as the pressure on manufacturers to reduce costs and therefore street prices will eventually lead to either them going out of business or reducing the quality of their manufacturing and of course their future R&D.
We cant have our cake and eat it.

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Me? But I`m such a loveable old bugger!

Quote dmills:

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Seems to me that the practise Steve reports of having a broad set of fallback options is pretty much what every professional has done for ever. It also seems to me that such people have never bought big ticket items on the high street, ever (Hell, even I don't).

---

Well, quite. If you're running a business, you absolutely have to factor redundancy into what you're doing. If my main DAW machine dies, I've got a backup - it's not as powerful, but it'll let me track and get a rough while clients are in. If that fails, I've still got standalone kit that will get us through.

A pro (attitude, not necessarily financial status) will always have spares of everything, just in case, whether it's live or in the studio.

These days, though, even studios that are making money need to be very careful with the money - if you can make a purchase for £100 less than you might have budgeted, it makes sense so to do. It's all about keeping the overheads down - and because successive governments have seen fit to continue to pile onerus taxes and stupid rules upon the small business, we're all being forced into bean-counting more than we used to.

That means looking for good prices every time you make a purchase - it means haggling, googling for the bargains, maybe buying stuff that's just been discontinued and so on.

All of which makes it galling to see the kit you'd like being sold in thUS or elsewhere at a fraction of the price being fixed in the UK. And it makes a mockery when it's more cost effective for me to buy abroad than it is to buy at trade prices...

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[url=http://www.facebook.com/pages/hifi-studios/117322741632389[/url]

It's kind of ironic, is it not, that the title of this thread happens to be "Digital Village"? (Think about it...)

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Dynamite with a laser beam...

Quote IvanSC:

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I suspect that a lot of the differences between USA and UK are down to scale - 123 Musicians Friend and the other BIG players have monumental buying power even compared to the likes of DV/Turkey/&c.

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Precisely! Go to the top of the class Ivan

I repeat - you must not underestimate the power the buyers at these franchises have over manufacturers ... it is colossal. They can dictate (not negotiate!) the price, when the manufacturer will get paid, sometimes even the specs by way of software updates. And the manufacturer will inevitably bend over and take it because they know that unless they concede, they will not sell product in the world's largest market. They know as well that if they meet their demands, said stores will buy boatloads of their stuff. And sometimes the manufacturer makes bugger all (if any sometimes) profit on the deal! Why do they do it? Because selling 10,000 units or more with a $10 profit is better than selling none with a $100 profit. And why don't they adopt a similar strategy here in the UK? Because selling 500 units with a $10 profit hardly covers administration costs let alone sales staff salaries, funding tech support personnel, warehouse floorspace rental, etc..

Quote IvanSC:

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Its all about the same business model as the Tescos of this world.

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Yep. And in much the same way the übermarkets treat their farmers/suppliers, so the large US stores treat the manufacturers - squeeze the lowest price possible out of them. And like farmers, if you voice an objection, you can just be struck off their list and you may as well pack up, turn the lights out and go home.

Quote IvanSC:

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And of course up to a point the average consumer wins in terms of price, but not necessarily in the lkong term, as the pressure on manufacturers to reduce costs and therefore street prices will eventually lead to either them going out of business or reducing the quality of their manufacturing and of course their future R&D.

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Which is exactly what has happened and is happening!

Quote IvanSC:

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We cant have our cake and eat it.

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I do find it ironic that people want stuff dirt cheap (and are getting it) and then complain that there's no service/support

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Website / Music Lab Machines / Blog

Thanks to Hollowsun, and Ivan for continuing to try and educate people about the realities of this business.

and the kinds of numbers Steve (Hollowsun) is throwing around are not atypical , or unrealistic either....

the North American continent market is by far still the largest sales area for our kind of toys.... and is essentially run by just a couple of retail chains.... who, in some areas, have more buying power EACH, than the entire European market.... never mind the UK.

and the UK market is , although perhaps with a higher average sale value per capita, actually one of the smallest regions , in terms of sales and yet highest cost in terms of marketing and rep mileage.... (per unit sales)


The only reasons many bother, is that

A) The Uk has always somewhat led the way in terms of music and media production, having far more impact than it's size or population would suggest. Thus it's sales , while not of the same magnitude as some other regions, still carry useful positive marketing weight....

B) many of the premier league quality audio development teams and brands are UK based , as a result of our historical engineering excellence.... (something recent governments have successively largely wasted and/or destroyed)


were it not for those factors, frankly, you'd be lucky to be able to buy much more "off the shelf" than an average 3rd world market supports.

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if you don't know who i am, i aint gonna tell you.

if you would like some serious figures to read up on, and have the requisite fee for the report....

http://www.researchandmarkets.com/reports/338782/musical_instruments_strin g_guitars_violins.htm


and 3496 euros , you'd have to REALLY want to know....

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if you don't know who i am, i aint gonna tell you.

I repeat my open question to Yamaha, Sennheiser et al... why will they not sell to me at US retail prices?

And why in a "free" market do they seek to stop me buying by mail order from US outlets and sorting out my own shipping, VAT, duty etc? (It's not as if Sweetwater has a passport control booth if I turn up in person, is it?)

Sure, I understand the power of US retailers. But the manufacturers manifestly do NOT understand the power of the internet, and the lasting, probably terminal damage to their reputations which flows from a deliberate policy to continue mugging me while I can find out in 5 seconds the extent to which they choose not to mug other people.

If they want to treat me as a second class citizen, I am more than happy to treat them as third rate suppliers and ignore them.

There's an old marketing maxim... it costs ten times more to get a new customer than it does to keep an existing one. And they are losing me. I'm already fed up to the back teeth with e.g. paying £40 (to Thomann, in Germany) for a mic clip for a Sennheiser 421, or £250 for a U87 shockmount. There are very serious competitors out there. (My U87s and KM84s/KM184s sit in very nice Peluso "clone" shockmounts, shipped from America at a fifth of the price...).

Some mornings I wake up feeling genuine animosity to these companies for this sort of exploitation. And when I buy new mics these days, they tend to come from interesting new "boutique" suppliers.

You can make the best product in the world, but you won't sell it if you treat your customers like idiots, or worse, with contempt and disdain.

Why (apart from naked greed) is it so hard for them to see that?

Edited by Steve Hill (09/12/07 09:58 PM)

Quote hollowsun:

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Because selling 10,000 units or more with a $10 profit is better than selling none with a $100 profit. And why don't they adopt a similar strategy here in the UK? Because selling 500 units with a $10 profit hardly covers administration costs let alone sales staff salaries, funding tech support personnel, warehouse floorspace rental, etc..

---

Until, of course, you add that 500 to the sales elsewhere in the world. No matter how much anyone might think that the big US chains are screwing prices down, outfits like Sennheiser and Yamaha have beancounters working things out to make sure that there's enough markup when the kit leaves the factory - else it doesn't.

And if it can leave the factory at that price to get to the US, then it can leave for the UK at the same price. More to the point, I don't honestly think that Yammy or Senn actually give a flying fork whether Sweetwater or wherever flogs some kit to an English bloke - but I dare bet that the UK disties and UK branches give rather more than a flying fork - it'll have come from the UK, not Japan, all this price fixing bollox.

Like I've said before, I'm firmly with Steve on this one - I'm sick to the back teeth of being ripped off by price fixing and dollar=pound crap.

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[url=http://www.facebook.com/pages/hifi-studios/117322741632389[/url]

Quote Steve Hill:

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I repeat my open question to Yamaha, Sennheiser et al... why will they not sell to me at US retail prices?

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Errmmm... because they can't afford to given the small UK turnover?

Quote Steve Hill:

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And why in a "free" market do they seek to stop me buying by mail order from US outlets and sorting out my own shipping, VAT, duty etc?

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Do they actively stop you? I think not. But they'd probably prefer it if you didn't.

Quote Steve Hill:

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(It's not as if Sweetwater has a passport control booth if I turn up in person, is it?)

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True - but US Customs & Excise do!

Quote Steve Hill:

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Sure, I understand the power of US retailers. But the manufacturers manifestly do NOT understand the power of the internet, and the lasting, probably terminal damage to their reputations which flows from a deliberate policy to continue mugging me while I can find out in 5 seconds the extent to which they choose not to mug other people.

---

And I suggest that you do not understand the lasting, probably terminal damage to their R+D departments if they can't get a meaningful ROI by continually dumping stuff out at bargain basement prices.

Besides which, it's not always the manufacturer that is the bogey man here. Often, dealers take a hit on their margins to sell some quantity and they'd rather get 5% of something than 15% of nothing.

Quote Steve Hill:

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If they want to treat me as a second class citizen

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How on earth are they treating you like a second class citizen? If you want a taste of that, try being a woman in certain middle eastern or third world countries! Being charged a little more for a mic in the UK is hardly comparable especially when you have the option to buy elsewhere.

Quote Steve Hill:

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There's an old marketing maxim... it costs ten times more to get a new customer than it does to keep an existing one. And they are losing me. I'm already fed up to the back teeth with e.g. paying £40 (to Thomann, in Germany) for a mic clip for a Sennheiser 421, or £250 for a U87 shockmount. There are very serious competitors out there. (My U87s and KM84s/KM184s sit in very nice Peluso "clone" shockmounts, shipped from America at a fifth of the price...).

---

So you have found a cost effective solution. Excellent. What is the problem?

Quote Steve Hill:

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Why (apart from naked greed) is it so hard for them to see that?

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Naked greed? Just like yourself, they are trying to run a profitable business not a charity to support impoverished musos or tight wads ... they want an ROI on their product. Without that, the bean counting accountants move in, halt development, sack engineers, cut back (or stop) support and then dumb down their product line to sure fire, cheapo, numpty, 'kwiksell' boxes that will satisfy share holders ... or close down/sell off the company completely. And it won't matter that the 'kwiksell' boxes don't work (at the price they're going out for, there were insufficient dev funds required to test it properly and the bargain basement profit margin doesn't afford any tech support), the box has shifted, generated a sale so the shareholders are happy - f'ck the customer.

Is this the world you want? Because it's the world you're gonna get!

Rant and puff against Sennheiser (whoever) all you like but will you be happy when their shareholders decide that $25 shite is where the mass market/profitability is at and they have their bean counters disband their engineering power (or re-assign it to producing $25 shite). Or perhaps you'd be happy if Yamaha's shareholding board decide that making Motifs or studio monitors or digital desks is too much trouble and no longer profitable so chuck that line in favour of cheap home keyboards and digital pianos for the Chinese market which is.

Your choice.

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Website / Music Lab Machines / Blog

Quote hifistud2:

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And if it can leave the factory at that price to get to the US, then it can leave for the UK at the same price.

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Theoretically yes; practically no.

Quote hifistud2:

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More to the point, I don't honestly think that Yammy or Senn actually give a flying fork whether Sweetwater or wherever flogs some kit to an English bloke

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True - which is why I don't understand the hissy fit!

Quote hifistud2:

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but I dare bet that the UK disties and UK branches give rather more than a flying fork - it'll have come from the UK, not Japan, all this price fixing bollox.

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Not sure I understand your point there.

What the UK "disties" will give a flying fork over is that a UK citizen has not given them the business and bought from abroad (effectively smuggling!) and they will have lost out thereby paving the way, perhaps, to their ultimate demise. There's a good business model - everyone shopping abroad with no local support

Quote hifistud2:

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I'm sick to the back teeth of being ripped off by price fixing and dollar=pound crap.

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Price fixing, dollar=pound crap?

I was in LA week before last. I bought a six pack of beers for $6 (that's roughly £3 here). Here, the same would cost me at least $12/£6 or more. Smokes are half the price they are here. Petrol is almost free there (I jest, of course, but it's a f'ck sight lower than here). A whoppa-burger there is 99¢ (50p), my lunch worked out at around £1 for a help-yourself-to-what-you-like salad and 30p for a coffee. A Coke was half the price of the UK. I could buy a litre of milk for a fraction of the cost here. The cost of living in the world's biggest Western market is considerably less than it is here in the UK and much of it due to taxes and stuff our government impose.

Strikes me that what people want here are products whose price is dictated by another country's economics. Short term, that will get you a bargain. Long term....? You may get royally f'cked when the shareholders decide it's no longer profitable to invest in a lame duck that generates little or no profit. Which is the bottom line, like it or not!

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Website / Music Lab Machines / Blog

Quote hollowsun:

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Theoretically yes; practically no.

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Practically? Hmmm... lemme see - it costs me £20 to make a doobreyfirkinwotnot, and I flog it out the door at £40 - £39 if you buy a thousand. Some big company comes along and says "we want fifty thousand a month, and we'll pay you £31 for each one." I'm re-tooling, re-sourcing and my buy price oes down to £15... still got the same percentage markup, and I flog to everybody at £31. It's not rocket science.

Quote hifistud2:

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More to the point, I don't honestly think that Yammy or Senn actually give a flying fork whether Sweetwater or wherever flogs some kit to an English bloke

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Quote:

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True - which is why I don't understand the hissy fit!

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Simply because they'll sanction protectionist price-fixing tactics generated in the UK market - just because it wasn't their idea doesn't mke them any less guilty of conspiracy.

Quote hifistud2:

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but I dare bet that the UK disties and UK branches give rather more than a flying fork - it'll have come from the UK, not Japan, all this price fixing bollox.

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Quote:

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Not sure I understand your point there.

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The point is as I've just made - if Yam etc can afford to have its it sold at $XX in the US, it can afford to have 'em sold at the exact same price over here.

Quote:

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What the UK "disties" will give a flying fork over is that a UK citizen has not given them the business and bought from abroad (effectively smuggling!) and they will have lost out thereby paving the way, perhaps, to their ultimate demise. There's a good business model - everyone shopping abroad with no local support

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1. It's not smuggling - you pay the VAT and duty. And tough on the disties - if they got as tough with the manufacturers as these mythical huge stateside companies and weren't complicit in price fixing (of which I have first hand experience, by the way), then they might get some sense out of the manufacturers.

2. Local support? I give the local support round here, because the majority of outlets aren't bloody capable of so doing! But I think you'll find sites like this very one are taking over that very task - and, like here, are often much more useful, quick and knowledgeable than many retail outlets.

Quote hifistud2:

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I'm sick to the back teeth of being ripped off by price fixing and dollar=pound crap.

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Quote:

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Price fixing, dollar=pound crap?

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Price fixing... I take it you know what that is? Disties/makers imposing artificially high prices on retaillers by threatening to stop their supply if they don't play ball. I have first hand experience of this. I don't like it.

And charging in pounds what US dealers charge in dollars - go price a U87 in the states...

Quote:

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I was in LA week before last. I bought a six pack of beers for $6 (that's roughly £3 here). Here, the same would cost me at least $12/£6 or more. Smokes are half the price they are here. Petrol is almost free there (I jest, of course, but it's a f'ck sight lower than here). A whoppa-burger there is 99¢ (50p), my lunch worked out at around £1 for a help-yourself-to-what-you-like salad and 30p for a coffee. A Coke was half the price of the UK. I could buy a litre of milk for a fraction of the cost here. The cost of living in the world's biggest Western market is considerably less than it is here in the UK and much of it due to taxes and stuff our government impose.

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You're shopping in the wrong plce, mate - six quid for a six pack? Never heard of ASDA?? :-) And your food prices - yes, the US is very cheap to eat in - it's even free in Vegas. So what? I'll repeat, US retail prices are less than our trade prices - again, first hand experience. Ergo, we should be able to buy (at trade) much more cheaply.

Quote:

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Strikes me that what people want here are products whose price is dictated by another country's economics. Short term, that will get you a bargain. Long term....? You may get royally f'cked when the shareholders decide it's no longer profitable to invest in a lame duck that generates little or no profit. Which is the bottom line, like it or not!

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The price to manufacture is based on another country's economics - it's the price to retaillers and the price fixing that goes on that causes the problems. It's patently not protecting UK businesses, because more people are buying from abroad (yes, even from Thomann) to get best prices, given the paucity of support you get here anyway. And there's the school of thought that says if Yamaha and others dump the UK, then UK based manufacturers of kit will do better.

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[url=http://www.facebook.com/pages/hifi-studios/117322741632389[/url]

Quote hifistud2:

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The point is as I've just made - if Yam etc can afford to have its it sold at $XX in the US, it can afford to have 'em sold at the exact same price over here.

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No - it can't. The economics and the scale just cannot be compared.

"Yam etc" can afford to have it sold at $XX in the US because they shift sh'tloads over there - thousands, tens of thousands of units compared with maybe - if you're lucky and it's a 'must-have' item - hundreds here. THAT'S the difference.

The US chain suppliers have colossal bargaining power; UK dealers do not. Neither can UK dealers survive by matching US margins ... which is clear to see by the fact that a lot of local high street music shops have gone to the wall because they are unable to compete pricewise with the internet. That may not bother you or the net savvy in search of the cheapest deal but I wonder where kids will go in future to try out the latest guitar, bass, amp, keyboard - whatever - when all these places are replaced by Starbucks, MuckDonalds or charity shops. Oh! F'ck 'em - use the 30 day returns policy and let the buggers sort it out.

Oh brave new world.

Short term thinking; long term ramifications....

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Website / Music Lab Machines / Blog

Just a little story. About fifteen years ago I decided to set up my studio in a high street location. I wanted to separate work from home, and it was a novelty to get up in the morning and leave the house. I thought that, given the location, I could start selling gear as a sideline, so I got the Yamaha rep round for a chat. It transpired that, on my projected sales, Yamaha's trade prices to me would actually be more expensive than Turnkey's retail prices! Not a huge surprise in retrospect, but an eye opener when it comes to the realities of music retail in this country.

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"Over fifteen years without a slogan"

This is like a pantomime - oh yes they can, oh no they can't...

On the narrow question, the reason I can't buy Yamaha from a US retailer is because Yamaha makes it a term of supply that they do not supply mail order customers overseas, protecting (that odious word again) their dealers in those countries. That stinks.

I got the Peluso stuff through their UK distributor at a bit more than US prices (fair enough with shiping, VAT etc) but far far less than the equivalent Neumann bits.

R&D? We're talking about elastic bands on a wire frame here. And with the possible exception of digital technology and some specialist applications like surround sound and binaural experiments, mic technology was pretty much settled in the 1930s and has not evolved since. Thereafter it's about engineering quality, reliability etc... and a small handful of "traditional" excellent companies no longer have a monopoly there.

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Dynamite with a laser beam...

When I came to buy my new studio desk (Omnirax so not cheap anyway) I checked the UK dealer for a price and it was more than double the US price in dollars. They had taken the dollar price, doubled it and then turned it in to £s. Therefore, a $750 desk became a £1500 desk. Needless to say I imported from the US and even with shipping and VAT etc I saved £300.

Steve and others are claiming that companies can afford to sell at US prices across the world and as he says this has degenerated into a oh yes they can - oh no they can't.

At the risk of bringing real data in and spoiling this entertaining comic turn, is there any evidence from the profits of these companies that they could afford to reduce their margins?

I have to add that I don't think it's fair to claim that companies are treating me as 'second class' for charging the price they can. They don't owe me anything. That's not to say I like it...

J

Quote Setter:

---

Steve and others are claiming that companies can afford to sell at US prices across the world and as he says this has degenerated into a oh yes they can - oh no they can't.

At the risk of bringing real data in and spoiling this entertaining comic turn, is there any evidence from the profits of these companies that they could afford to reduce their margins?

I have to add that I don't think it's fair to claim that companies are treating me as 'second class' for charging the price they can. They don't owe me anything. That's not to say I like it...

J

---

They certainly didn't like me importing the desk from the US.

Quote hollowsun:

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I do find it ironic that people want stuff dirt cheap (and are getting it) and then complain that there's no service/support

---

This is not the case with me, I simply want a price that is fair, not neccessarily dirt cheap. I rarely use customer support, all my help usually comes from forums or my own doing.

There really is no excuse for a distributor to say, "we're charging you another £xxx.xx, in the UK, for support", when we could've got that same support for £xxx.xx LESS elsewhere. If this is the case, why don't they sell the products for same price and give the customer the option to purchase support? Sony do this, but they still give you online and direct support, which is quite quick and efficient.

This brings me onto another question... I may move aborad within the next 12 months, possibly Canada / US. What happens to my customer support then, for products I purchased outside of these territories, i.e. Cubase SX?

Cheers,
Peter

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Composer, Producer, Sound Designer
www.universal-sound-design.com

Quote hollowsun:

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"Yam etc" can afford to have it sold at $XX in the US because they shift sh'tloads over there -

---

That still doesn't make sense. They're shifting loads of units in the US... GREAT... They're shifting even more within the UK / Europe so how come we're paying more?!?! It's still the same product shipped from the same production line. Like I said before, why can't manufacturers treat our tiny UK as an extension of US sales, gaining extra 'fair' revenue rather than adding a dollop of extra and unjustified cash on top just becasue we're smaller. The word discrimintaion springs to mind!!!

It simply DOESN'T cost any more to ship to the UK than it does the US. The days when people actually believed that are long behind us!

P

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Composer, Producer, Sound Designer
www.universal-sound-design.com

Hi - i've only had a small chance to scan through so answering the last question first - if you move abroad and want to get support (using Cubase as the example), you'll find that the distributor will ask you for a small fee to register an item bought outside it's territory - in the UK its £25.

Back to the pricing issue - a short while ago some of our manufacturers would issue SRP's with the same € & $ price, as the dollar has slipped, we're now seeing a differential and I would imagine that it's taking time for this to shake through - it takes a long time for prices to rise, if they ever do.

Anyway - back to work..

Stephen Parker
Music Technology Manager
Arbiter Group

Quote James Perrett:

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There was an advert in there from a card handling company offering rates of 1.5% for credit cards and a fixed fee (something like 30p) for debit cards. As I understand it, Maestro is Mastercard's name for a debit card so the fee for a Maestro transaction should be fixed.

---

It still comes down to the volumes and the contract - I bought a bottle of water at Liverpool "John Lennon" Airport on Friday for about a quid and they happily took Maestro. Other places impose a minimum spend of ten quid.

I requested information and quotes from a couple of companies' Merchant Card Service divisions a few years back (and compared to PayPal). I don't remember the detail now, but there were sliding scales according to the transaction amount, and bandings which favoured high volume retailers. Debit cards invariably worked out cheaper than credit cards.

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TAKEN.BALL.GONE.HOME

Quote Stephen Parker:

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Hi - i've only had a small chance to scan through so answering the last question first - if you move abroad and want to get support (using Cubase as the example), you'll find that the distributor will ask you for a small fee to register an item bought outside it's territory - in the UK its £25.

---

Sorry to be pedantic, but what if I was working abroad for a short time, i.e. 6 months at a time and needed to come back and forth?

In general, £25 aint a lot of cash but it seems a lot for something you technically 'should' already have, regardless of location. Saying that though, the last time I contacted Steinberg for Tech Support was... Never!

It's nice to know it's not mandatory and if you REALLY do need it, it's not overly expensive.

Cheers,
Peter

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

Hi Peter - if i were you then i'd leave it unless I needed to get the support/service (i.e. transferring licences from a broken dongle etc).

Cheers

Stephen Parker
Music Technology Manager
Arbiter Group

I'll just bring a couple of other points to the table as I'm too tired to actually get into the whole debate here...

The idea of treating the whole world (or whole 'developed' world, say) as one market has limited application. The EU is a big trade bloc, sure. It imposes its own import tariffs on most products. It imposes VAT on most products. It is not quite the same homogeneous trading area as the US. For example, there are a whole range of currencies, languages, legislations, shipping companies for starters. Products need to be CE marked. Distributors have to observe minimum wage and working time limits for staff, and provide for decent holiday, sickness and pension entitlements - and cover the local income and corporation tax, and social security costs. In short, it is more expensive to trade in Europe - whether that's a good or bad thing, net.

The notion of an ideal market always finding the right price requires that we are comparing like for like - that we are talking identical, commodity goods essentially. And this surely only holds water when talking about things which sell in sufficient volumes to escape the 'noise' of small numbers.

Sorry, I'm only a humble engineer, not an economist. But what applies to generic computer peripherals doesn't necessarily hold for say DAW control surfaces or ribbon microphones...

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TAKEN.BALL.GONE.HOME

Quote Stephen Parker:

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Hi - i've only had a small chance to scan through so answering the last question first - if you move abroad and want to get support (using Cubase as the example), you'll find that the distributor will ask you for a small fee to register an item bought outside it's territory - in the UK its £25.[/qiote]

Possibly becasue Steinberg has never heard of International Warranties - like Sony's kit carries, for example.

Quote:

---

Back to the pricing issue - a short while ago some of our manufacturers would issue SRP's with the same € & $ price, as the dollar has slipped, we're now seeing a differential and I would imagine that it's taking time for this to shake through - it takes a long time for prices to rise, if they ever do.

---

When IBM made its PCs in the US and shipped 'em over here, there was, perhaps, some justification in making the figures the same and the currency sign different ($xx=£xx). But when product comes from Japan, China, Taiwan or Germany, there's no justification. And the prices in the US won't rise - their consumers won't wear it, and neither will the retaillers.

However, the way you word it is interesting... are we saying here that the price is set in pounds and then translated to dollars? Or is it in Yen, translated to dollars and then a sign change for pounds? Or - nd I suspect this is the true one - is it just what the market will bear?

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[url=http://www.facebook.com/pages/hifi-studios/117322741632389[/url]

Quote Steve Hill:

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mic technology was pretty much settled in the 1930s and has not evolved since.

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Er... A lot of Americans seem to believe that, and perhaps it's not surprising that you do too -- but it is complete and utter nonsense.

Just a few significant developments of the top of my head that have happened since the 1930s:

Neumann's extremely high dynamic range digital microphones

The phenomenal development of electret designs by the likes of DPA and AKG

Sennheiser's ultralow distortion symmetrical capsule designs

Audio Technica's development of highly directional mics through the use of multiple capsules and digital delays.

Royer's electronically buffered ribbons (now copied by several others)

The Soundfield concept and it's recent tranfer into the digital domain

Crowley and Tripp's new ribbon materials that allow safe placement in kick drums!

Sanken's multicapsule array short gun microphones

The huge development in compact microphone designs by the likes of Schoeps, Neumann, Sennhesier and others.

Massive new advances in time domain controlled arrays for stereo and surround application from the likes of Trinnov (and others)

And other developments yet to see practical audio mics, but already in use in industrial applications including optical and hot-wire systems.

Without the mic manufacturers investing in R&D to develop this stuff, we'd still be struggling with stupidly noisy capacitor mics and feeble dynamics with no top end -- which is all that was around in the 1930s!

You'll note that the majority of the developmetns I've listed above have come from the 'traditional' manufacturers you dismiss so quickly!

Hugh

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Technical Editor, Sound On Sound

Quote JimiQ:

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The idea of treating the whole world (or whole 'developed' world, say) as one market has limited application. The EU is a big trade bloc, sure. It imposes its own import tariffs on most products. It imposes VAT on most products. It is not quite the same homogeneous trading area as the US.

Sorry, I'm only a humble engineer, not an economist. But what applies to generic computer peripherals doesn't necessarily hold for say DAW control surfaces or ribbon microphones...

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It holds true for every manufactured product:

Cost of raw materials = X
Cost to manufacture = Y
Cost to ship = Z
Duties,taxes, levies = W

For any given market the base cost, then, is X+Y+Z+W, where X,Y and Z are costants, and the variable is W.

Judging by some prices, W can exceed the total of X,Y and Z - but only where the country is the UK. In truth, we know what the duties and taxes here are - and they are not that far removed from those in the US.

All of which means that prices are being loaded for the UK - it really is that simple.

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[url=http://www.facebook.com/pages/hifi-studios/117322741632389[/url]

Quote Conz:

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It simply DOESN'T cost any more to ship to the UK than it does the US. The days when people actually believed that are long behind us!

---

I'm told that's really not the case -- it does cost more to ship in quantity to some places than others, depending on relative lcoations.

But the point is that the selling price is not just about the cost ex-factory. Every business has overheads which have to be factored in before you can arrive at the price a business can afford to sell to its local customers.

There's internal transport from the arrival port to the retailers. We know that transport costs in the US are a fraction of those in the UK/Europe. The there's warehousing and retail outlet ground rates -- both of which are considerably higher in the UK than in the US because this is a tiny overcrowded country and the US isn't.

It's just not as simple as you are making out.

I know a lot of UK retailers and distributors in this business, and none of them own mansions and drive about in rollers. Most struggle with cash flow on a regular basis. So it really isn't the case in general that people are being ripped off in the UK by the existing supply chain.

I think I'd point the finger more towards those who control the taxes in this country, personally.

hugh

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Technical Editor, Sound On Sound

Quote hifistud2:

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Cost of raw materials = X
Cost to manufacture = Y
Cost to ship = Z
Duties,taxes, levies = W

For any given market the base cost, then, is X+Y+Z+W, where X,Y and Z are costants, and the variable is W.

---

You have left out the cost to run a business, and taht is a variable which is definitely higher in the UK and Europe than in the US.

Hugh

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Technical Editor, Sound On Sound

Quote Paul Johnson Rogers:

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Just a little story. About fifteen years ago I decided to set up my studio in a high street location. I wanted to separate work from home, and it was a novelty to get up in the morning and leave the house. I thought that, given the location, I could start selling gear as a sideline, so I got the Yamaha rep round for a chat. It transpired that, on my projected sales, Yamaha's trade prices to me would actually be more expensive than Turnkey's retail prices! Not a huge surprise in retrospect, but an eye opener when it comes to the realities of music retail in this country.

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I once watched the manager of a shop phone a supplier (UK arm of a big japanese firm) and rant at them when I asked if he could price match something. Turned out I could get it for less than him!

Quote hifistud2:

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The point is as I've just made - if Yam etc can afford to have its it sold at $XX in the US, it can afford to have 'em sold at the exact same price over here.

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Total rubbish!

Assuming a US and UK distributor buy at the same price........

The distributor needs to pay staff, have a competent service dept., have office and warehousing premeses, pay the UKs exorbitant business tax, pay, pay, pay - as well as making a profit.

From what I have seen there is nothing at all about "profiteering" or keeping prices high in the UK - just that a business needs a certain profit margin to survive and the dealer price is worked out on the cost of goods + cost of running the business - nothing else.

Yes, the "retail" price includes a dealer margin and the dealer can sell for what he wants.

The difference between the US and UK price for European manufactured goods is purely down to the lower cost of running a business in the US - don't forget there is no National Health there and everyone has to buy insurance (so no employers contribution. etc.).

Some manufacturers also manufacture in the USA for the US market (Sennheiser certainly do, for some products) which would also affect the price.

And checking the price of a stereo set of MKH 8040 at $2,500 street price and £1,395 UK list price (I don't know the UK street price) it's not very far apart.

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John - Sound-Link ProAudio
President - Federation Internationale des Chasseurs de Sons

Quote Hugh Robjohns:

---

Quote Conz:

---

It simply DOESN'T cost any more to ship to the UK than it does the US. The days when people actually believed that are long behind us!

---

I'm told that's really not the case -- it does cost more to ship in quantity to some places than others, depending on relative lcoations.

But the point is that the selling price is not just about the cost ex-factory. Every business has overheads which have to be factored in before you can arrive at the price a business can afford to sell to its local customers.

There's internal transport from the arrival port to the retailers. We know that transport costs in the US are a fraction of those in the UK/Europe. The there's warehousing and retail outlet ground rates -- both of which are considerably higher in the UK than in the US because this is a tiny overcrowded country and the US isn't.

It's just not as simple as you are making out.

I know a lot of UK retailers and distributors in this business, and none of them own mansions and drive about in rollers. Most struggle with cash flow on a regular basis. So it really isn't the case in general that people are being ripped off in the UK by the existing supply chain.

I think I'd point the finger more towards those who control the taxes in this country, personally.

hugh

---

This isn't true for the desk I imported from the US. The UK dealer basically did the same as me. Bought the desk direct from Omnirax (for cost/dealer price)and then shipped it into the UK. They then doubled the price in dollars and then converted into £s. They have overheads sure, however, I don't see it justifying doubling the price. A $750 dollar desk became a £1500 desk.

Quote Hugh Robjohns:

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I think I'd point the finger more towards those who control the taxes in this country, personally.

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Nail - head - knocked.

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John - Sound-Link ProAudio
President - Federation Internationale des Chasseurs de Sons

Quote Hugh Robjohns:

---

Quote Conz:

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It simply DOESN'T cost any more to ship to the UK than it does the US. The days when people actually believed that are long behind us!

---

I'm told that's really not the case -- it does cost more to ship in quantity to some places than others, depending on relative lcoations.

But the point is that the selling price is not just about the cost ex-factory. Every business has overheads which have to be factored in before you can arrive at the price a business can afford to sell to its local customers.

There's internal transport from the arrival port to the retailers. We know that transport costs in the US are a fraction of those in the UK/Europe. The there's warehousing and retail outlet ground rates -- both of which are considerably higher in the UK than in the US because this is a tiny overcrowded country and the US isn't.

It's just not as simple as you are making out.

I know a lot of UK retailers and distributors in this business, and none of them own mansions and drive about in rollers. Most struggle with cash flow on a regular basis. So it really isn't the case in general that people are being ripped off in the UK by the existing supply chain.

hugh

---

Hi Hugh,

This is why I'm sure it is beneficial for companies (and their customers), such as NI, to sell direct just as Sounds Online US and Sounds Online Europe do. Their prices are the same, regardless. Obviously this isn't good for the retailers, but if a UK supplier, at the end of the chain, has to up their price, just to keep their business above water, then, unfortunately, I really can't see them surviving much longer.

More and more people, "post google world", are looking for cheaper and alternative means of making a purchase.

Maybe if some masterplan was devised to equal the economy then everyone will benefit in the long run. It sounds like, under the current circumstances, it's a complete struggle which, to me, spells out something really needs to be done other than charge more! People just aren't buying this (pardon the pun) anymore.

I'm not, for one minute, pretending to know anything about economics... as I don't... what I do know is I strongly disagree with how thing are and sure there is an alternative & more appealing way of dealing with this.

Cheers,
Peter

--------------------
Composer, Producer, Sound Designer
www.universal-sound-design.com

Quote thenaturallevel:

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This isn't true for the desk I imported from the US. The UK dealer basically did the same as me. Bought the desk direct from Omnirax (for cost/dealer price)and then shipped it into the UK. They then doubled the price in dollars and then converted into £s. They have overheads sure, however, I don't see it justifying doubling the price. A $750 dollar desk became a £1500 desk.

---

You said yourself in an earlier post you saved £300 after taxes and shipping. Lets assume it costs the importer the same amount to get it here, less the VAT which they can reclaim (about £65 on $750). From that £365 deduct the cost of office space, telephone calls to the US, heating, warehousing, office computers & machines and so on.

Lets say there is £300 left after expenses. To turn that into someones wage you need to pay around 12% employers NI, 12% employees NI and either 22% or 40% income tax.
Alternatively if it's treated as profit and taken as a dividend by shareholders they'll pay 19% corporation tax and 32.5% income tax. Either way, the take-home benefit to someone somewhere of importing your desk for you is going to be around £150, for maybe a days work spent dealing with the supplier, customs, shipping and potentially supporting you in the future. It's a reasonable living, sure, but it's hardly bare-faced greed.

This is where volume wins. If you are importing 10 or 100 or a thousand, you *might* get a 5% lower price to start with, but the per-unit costs will be much lower, maybe even only 5% of a single unit. Even so, the saving, if passed on, is only in the region of 10%.

Edited by markhodges (10/12/07 12:54 PM)

Quote Conz:

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This is why I'm sure it is beneficial for companies (and their customers), such as NI, to sell direct.

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It's a decision for the manufacturer. Many manufacturers don't want to get involved selling to the end user. They don't want all the hassle that comes with individual sales to people, they prefer dealing with a few distributors.

Quote:

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More and more people, "post google world", are looking for cheaper and alternative means of making a purchase.

---

Yes, they are, and it is quite understandable. The question is whether it is realistic in the long term, and how such a change in behaviour will affect the market and the supply chain. Things will obviously be forced to change. That is inevitable. But do the short term price savings warrant the potential long term damage? Many of us fear not, but who knows.

hugh

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Technical Editor, Sound On Sound

Quote markhodges:

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Either way, the take-home benefit to someone somewhere of importing your desk for you is going to be around £150, for maybe a days work spent dealing with the supplier, customs, shipping and potentially supporting you in the future. It's a reasonable living, sure, but it's hardly bare-faced greed.

---

A very well reasoned argument that just highlights the reality of the situation. As you say, hardly bare faced greed.

hugh

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Technical Editor, Sound On Sound

Quote Hugh Robjohns:

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The question is whether it is realistic in the long term, and how such a change in behaviour will affect the market and the supply chain. Things will obviously be forced to change. That is inevitable. But do the short term price savings warrant the potential long term damage?

---

Edward de Bono on "Ludecy":
Ludecy (i)
Ludecy (ii)

It's his own made-up word, but would seem to be appropriate here...

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TAKEN.BALL.GONE.HOME

Quote markhodges:

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Quote thenaturallevel:

---

This isn't true for the desk I imported from the US. The UK dealer basically did the same as me. Bought the desk direct from Omnirax (for cost/dealer price)and then shipped it into the UK. They then doubled the price in dollars and then converted into £s. They have overheads sure, however, I don't see it justifying doubling the price. A $750 dollar desk became a £1500 desk.

---

You said yourself in an earlier post you saved £300 after taxes and shipping. Lets assume it costs the importer the same amount to get it here, less the VAT which they can reclaim (about £65 on $750). From that £365 deduct the cost of office space, telephone calls to the US, heating, warehousing, office computers & machines and so on.

Lets say there is £300 left after expenses. To turn that into someones wage you need to pay around 12% employers NI, 12% employees NI and either 22% or 40% income tax.
Alternatively if it's treated as profit and taken as a dividend by shareholders they'll pay 19% corporation tax and 32.5% income tax. Either way, the take-home benefit to someone somewhere of importing your desk for you is going to be around £150, for maybe a days work spent dealing with the supplier, customs, shipping and potentially supporting you in the future. It's a reasonable living, sure, but it's hardly bare-faced greed.

This is another place where volume wins. If you are importing 10 or 100 or a thousand, you *might* get a lower price to start with, but the real benefit is that per-unit costs will be much lower.

---

I doubt the paid the same price I did in the first place. I agree that volume pays in this case. However, I don't see doubling the price in £s showing any great thought as to how much the desk costs in real terms i.e wages; floor space rent; heating etc. The way I looked at it is they were charging £1500, or effectively $3000 dollars, for a desk that cost $300 - $350 n the US. Ok the exchange was in my favour but it was in the UK dealers favour as well.

Great thread - something I've thought about for some considerable years.

I stand on both sides of this fence - I've extensive experience in a manufacturing/distribution company in Europe which shall remain nameless, and I also buy stuff for my small home studio occasionally.

To oversimplify - there are really two ways to do international distribution.

1 - Take all your costs globally including cost of manufacturing the product and shipping it everywhere, and divide them into every product sold, and then make the cost approximately equal worldwide. This means markets where product *could* have been sold cheaper, will end up more expensive to subsidise the markets that are harder to get to.

2 - Take your unit costs and add on the local cost of landing the product and supporting your supply chain in each territory. This means you will get potentially large differences between some countries.

In an ideal world, everyone would be following model '1'. There are a good few reasons why not everyone does. Primarily, it's insanely complicated, nearly impossibly so. In some countries you have manufacturer 'direct' to customer. In some countries you may go manufacturer-dealer-customer. In some countries you may go manufacturer-distributor-dealer-customer. You have to manage every one of these possibilities, in every single country worldwide, make sure that everyone along the way gets a viable margin (otherwise everything stops) - and ensure that every customer pays roughly the same.

On top of the multiple different steps you may have in many countries, you then have to cope with exchange rates which may be sliding in different directions all at once, duty which is different all over the world, and taxes which are both different and occasionally variable. Steve - your assertion that distributors should simply 'hedge' against moving exchange rates is very much wide of the mark, to put it mildly!! To take the almighty dollar as an example - it has now been significantly on the slide for an extended period of time. This means that if you manufacture outside dollars, but sell in them - your revenue from the US market is decreasing all the time, and it's absolutely out of your control. Imagine if every week your customers paid you 1% less, and you didn't know how long it was going to continue to drop! You can guess things may slide a little bit, but there are limits - there is no effective hedge against a protracted movement of this type. On the other hand, if you are a US company with European facilities, your European operations are currently getting more and more expensive (without you doing anything to cause it!) as everything is accounted for in dollars. Lower budgets, lower advertising, fewer special offers, etc etc.

Plus, 'hedging' as you refer to would basically entail making the prices artifically high in the first place, to protect the manfucturer against unseen fluctuations - and high prices are exactly what you are asking manufacturers to *not* do!

Quote:

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I repeat my open question to Yamaha, Sennheiser et al... why will they not sell to me at US retail prices?

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I'm sure you can find a way to purchase at US retail prices - just get a mailing address in the US - it can be done.

The most common misunderstanding that customers have, is seeing US$ prices on websites, and directly equating that via conversion rates with £ or € prices here. As has been pointed out many, many times, Sterling and Euro prices (even on websites) typically include shipping, duty, and VAT - the cost of getting that product to where it is, and where it is going. US prices typically do not include duty (which you will pay), do not include VAT (which you will pay) and so on.

I'm *not* saying there aren't differentials, even after you take all that in to account. Some companies are better, some companies are not as even. But the fact that it's a horrifically complicated and difficult issue does not mean that companies are out to rip off the consumer.

Quote:

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The consumers are going to win this one - be under no illusions. It's only a matter of timing.

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Well I'd dispute that, and your assertion that the consumers 'won' with the victory of supermarkets over small shops. The intangible social costs of the destruction of the traditional high street have yet to be fully realised. And enjoy your edge-of-town supermarket when peak oil hits (sorry - that's for another thread!)

As for my small micro-studio - I do buy occasionally on price, but I try to balance it with service. More and more, I want to purchase from a shop that will look after me if I need help, plus I want to support them before their knowledge and support is lost forever.

So, I understand what you mean Steve, but I'm with Hugh on this - the dealers have provided a fantastic service to customers and manufacturers for a long time, and doing globally uniform pricing is not as simple a matter as you paint it.

Each to their own - just rememember that every time you purchase studio equipment, you make a small choice about what the industry will look like in the future.

cheers,

d

The question I have agonized over, these many years, is one that I've never read about in any philosophical treatise, and yet I have found it has applied to countless situations and conversations overheard in bars, repair shops, sporting events, political debates, forums, etc.

The question: Do two people who don't know what they are talking about know more or less than one person who doesn't know what he's talking about?

We have been discussing this HERE at our off-topic forum.

This thread has brilliantly answered that question, once and for all!