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Old 09-22-2012, 08:59 PM   #2
murg
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Posts: 1,309
Karma: 2511408
Join Date: Jan 2012
Location: Australia
Device: Kobo: Not just an eReader, it's an adventure!
And before someone brings up sales taxes and shipping costs...

If the distributor is paying out cash for the devices at the wholesale level, then any import duties are based on the distribution cost of the devices, which will be somewhere between a 30%-50% discount on the retail price.

Depending on where you buy the device in Canada, there is between 5% and 15% sales taxes (GST/PST/HST).

As such, this makes Australia's 10% GST roughly equivalent to Canada's sales taxes, so the AU GST cannot be blamed for any part of the premium. Or at least no more than 5% (which is the Canadian GST rate).

If the distributor is acting more as an agent for Kobo (paying the monies to Kobo when the devices are sold), then the distributor has no risk and shouldn't be charging a premium.

Shipping cost is another factor. The devices are being made in Taiwan/China. The shipping costs for a single device should be no more than $4, based on various postal rates and the basic lightness of the devices. This shipping rates drops when shipping a pallet or container of the devices.

While airfreight can get expensive, if the devices are being shipped by sea (as a rumoured November release date suggests), then the freight costs are very minimal. This is based on the fact that bottled water is being shipped from China and sold in Australia. If you can ship bottled water from China and sell it at competitive (or even cheaper) prices, when the costs associated with sea shipping the devices will be less than $1 per device.
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