Alex asks if you can fund international travel by moving goods to places where they cost a lot.
Here's how you get to New Zealand.
Buy a Dell M6800 Workstation in the US for $2000 US. That's $2400 NZD.
That same computer sells for $5000 NZD in New Zealand, including GST. So $4350 without GST.
There aren't any of these up on TradeMe (our version of EBay). And I have no clue what discount "hard to warranty but otherwise brand new" computers sell at here. So there's some risk involved. But a $2000 NZD price difference on a single computer would cover an airfare from LAX to AKL. Bring a couple just to be safe. If customs thinks you're going to sell them here, they might stick you with 15% GST on the US price. Parallel importation is fully legal here though - whatever exclusive dealing arrangements Dell has with its NZ branch, the NZ government doesn't care about. If Dell NZ wants to punish Dell US for selling to somebody planning on on-shipping to NZ, that's up to Dell NZ and Dell US to sort out.
I need to replace my aging work Dell Latitude E6500. I drool over the M6800. It would be in-budget at US prices, but no way on NZ pricing. Instead I'm looking at the E6530. It also costs about twice as much as it would in the States.
I don't know why Dell charges double for a laptop in New Zealand. But they do. If I were buying one for personal use, I'd just buy the American one and get it here via YouShop; I'd be very happy to pay Customs the 15% at the border. If the University were doing it, it wouldn't even attract GST at the border as it's for business purposes and then is a non-taxed input. 20:1 that trying that for work would break at least 3 University rules, even if it did save a lot of money.
Apple usually takes a lot of stick for international pricing shenanigans, but their base model MacBook Pro has only a USD$100 markup in NZ (8%); the highest-end one has a $300 markup (11%).
If you're planning on financing your trip by bringing computer kit to New Zealand, compare prices at PriceSpy with prices at NewEgg. I should probably try it next time we head Stateside, just to see whether the arbitrage works. At worst I'm stuck with a new computer at home. I expect that much of the potential gains would be eaten up figuring out NZ/US model equivalencies.
Yes, not only is parallel importation legal here, but we even have, in the form of YouShop, a state-owned enterprise that facilitates it.
ReplyDeleteI'd be interested in a wider post on the economics of this kind of price discrimination - e.g. games downloaded from the steam site (so a digital download, no shipping involved), routinely cost more than twice as much in Australia & NZ as the US, while they are cheaper in Russia & China.
ReplyDeleteInterestingly, but not at all surprisingly, the items that tend to attract the biggest difference in prices are the heavy and bulky ones that are more difficult to arbitrage. Solid State Drives (small and light) don't sell for that much more here in NZ.
ReplyDeleteSteam does that?! What happens if you geomask with Hola?
ReplyDeleteYup. Processors are on par too. It's cases and power supplies that wind up getting outta whack.
ReplyDelete"You agree that you will not use IP proxying or other methods to disguise the place of your residence, whether to circumvent geographical restrictions on game content, to purchase at pricing not applicable to your geography, or for any other purpose. If you do this, we may terminate your access to your Account." - Steam Subscriber Agreement
ReplyDeleteSteam heavily price discriminates on a geographic basis. Prices tend to be cheaper in the USA and countries with rampant piracy like Russia.
Hmmm...yeah. I actually would be scared of messing with that. Losing Netflix, well, better to have had it and lost than never to have had at all. Losing Steam would be sad. How would I explain to the 5 year old where his Skyrim character went?
ReplyDeleteSo with parallel importing legal, how can companies get away with such massive price discrimination? Is the after-sale service of going through the official Dell importer really worth that much?
ReplyDeleteMy intuition would be that given New Zealand's relative remoteness, the small market size and the need to transport everything, the goods with the highest price differential vs. American/Asian/European prices would be goods with relative high bulk/weight relative to price -- which is why shoes (talking mass-market, not expensive niche brands) and books are so notably more expensive in New Zealand than elsewhere. That shouldn't apply to consumer electronics like cellphones, laptops and tablets. So this Dell situation is counterintuitive -- Eric, how would you explain it?
Hi Dave,
ReplyDeleteAgree. Shoes also have a tariff on them, which explains some of it.
With higher valued consumer electronics, the warranty might start mattering. And it's never quite clear whether you can get easy access to warranty services if you ship in a computer from abroad. If it's warranty driving it, then we expect bigger gaps on higher valued electronics regardless of weight, whenever there's risk of needing warranty services. The Dell one is kinda like that. I think Apple's laptops have worldwide servicing, which would also be consistent with a constant price gap.
I'd also expect that where large companies with fixed IT policies are your main clients, they're just not going to bother parallel importing computers. They can't tell for sure if the software build will be the same, there could be hassles in integrating it into the company's fleet of machines, warranties will be a problem (although big companies should be self-insuring this stuff - nonsense that it's a problem, but yet here we are). I suppose I could ask around here why I'm not allowed to get a $2000 better machine for the same price as the one that I'd otherwise be getting, but I suspect that "Computer says no" will be the usual answer.
To the big data cloud in the sky?
ReplyDeleteYou've never played. Correct answer: "Sovengaard beckoned."
ReplyDelete