Quote:
Originally Posted by burnafterreading
so, why does it cost more in AU than in USA to buy the same made-in-China product? because it CAN be priced higher. basic business: maximize your profits.
you (are asked to) pay more because you will (despite some complaining) pay more.
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Precisely. The way pricing works is not a case of cost+markup. Prices are set according to what the market will bear (ie what people will pay) and if that is a profitable price then it's a viable business. If you can convince people to spend $1000 on a widget that costs $1 to make, that's good business. If you can only get them to pay 50c, then it's not. For those who remember the transition from cassette tapes to CDs, cassettes cost a lot more to make but CDs were far more expensive (at least in Australia...no internet price comparison in those days!!) But because CDs were the new tech and reputedly higher quality then consumers were prepared to pay more.
Unfortunately for the producers and fortunately for consumers we now have the ability to compare prices around the world. I also feel that Australians have a stronger tendency to feel ripped off and discriminated against in this sector, and more willing to do something about it compared to the US (can't comment on other countries). This is reflected in our high rates of online piracy.