Archived posting to the Leica Users Group, 1998/03/18
[Author Prev] [Author Next] [Thread Prev] [Thread Next] [Author Index] [Topic Index] [Home] [Search]I must agree that the arguments for differing prices are indeed based in part on local and import taxes, money exchange rates, advertising and other administrative requirements, repair facilities, overstocks, greed, etc, there are additional fundamental reason for differing prices: There are a few details that are important in Europeon and Asian trade that you should be aware of.... a) In Europeon countries, they establish "subsidiaries" in foreign countries to act as their distributors. These subs act as independent agents with their own P+L statements. They act as if they must take in raw goods and then make a 30% wholesale profit on them. That means that a price in the producer country is generally lower than in a foreign country. Did anyone read the words grey market here? Leica is directly and 100% responsible for this issue. World-wide pricing with price protection would take this issue right out. b) Countries have differing levels of fair trade laws. In the US, we have anit fair trade practice laws that protect the consumer against the practice that the manufacturer insists on the selling price of a product and penalizes the seller for breaking that price This practice was overthrown years ago, (but somehow Leica and others have managed to circumvent the intent of the law and have instituted MAP ( minimum advertised price. ) Which is why all the ads read at the same price, to the penny. And your Little K+S shop in Palo Alto sells the M6 at the same price as gigando B+H in New York. The problem is that the LOCAL office sets these prices at what they think the market will bear in the country they are in. This becomes very clear in Europe where, after analysis of duties, the price in France might be significantly higher than in Italy for the same goods made in Germany. The local management insists on retail pricing. Even if 10 miles away, the prices are different. c) In Asia, a predominant issue is that the local stores will accept a lower profit margin, ususally driven by the availability and cost of money (time value of money). They prefer to turn over inventory more times at a lower profit per time, sometimes as low as 0%. This is a fundamentally different approach than US and Europeon practices which tend to want (maybe stubbornly) to make 30% on each sale even if they sit on merchandise for a year or more. Beware that you contribute all the difference to marketing and administrative..... the reasons above are very significant to the consumer. I just bought a new M6 from Leica USA. I like the idea that I can get 100% coverage even if I dunk the body in the water. I consciously made that choice. I could have saved $500 if I bought from Japan, or more with a used body. We all can make our own choices, buying from "dealers" like Chatterton, Black, Kuhel, B+H, CWOE, and others. Grey market is also a viable option. The bottom line is to read the ads, then make a choice based upon what YOU want or need.... for warranty service. Thank You Remove "ZZ" form auto reply address or please reply to address below: Frank Filippone red735i@worldnet.att.net