Big brands silent on New Zealand’s inflated prices

Big brands silent on New Zealand’s inflated prices
Big name brands are refusing to justify the fact they are charging New Zealand customers more for their products than overseas buyers pay.

With Lorde’s debut album ‘Pure Heroine’ being sold on iTunes NZ for $17.99 instead of $14.69 like in the US, it is no wonder we will never be royals!

Idealog recently covered Slingshot’s launch of FrontUp.co.nz, a website which helps customers ask local companies to ‘front up’ to why they are being charged a lot more than consumers overseas.

New Zealanders are paying more for goods and services compared to overseas customers and the companies are not explaining why, according to Slingshot’s website FrontUp.co.nz.

When Front Up asked companies Fonterra, Nike and Apple why Kiwis are paying excessive prices, none of them responded.

Fonterra only responded when a Sunday newspaper and TV One’s Breakfast show ran stories on Front Up’s investigations. They found Fonterra Dairy Dale milk was being sold at $1.70 per litre in New Zealand, NZ$1.20 in the US, and NZ$0.86 in Britain.

Since the website launched last month, 30 products and services have been reviewed with only a few companies, including Samsung, Steinlager and NZ Beef and Lamb replying to consumer concerns.

“It’s just a shame most businesses couldn’t be bothered to respond, or seemingly don’t care about the high prices consumers are paying for their products,” says Taryn Hamilton, Front Up's general manager.

“A lot of the companies that are responding reply with a reasonable explanation but often with a PR (public relations) spin,” Hamilton adds.

Why are New Zealanders paying $89 more for a fresh pair of Nike kicks than in the US? Or $274 for sunglasses which retail for $185 in the US? Remember the 2011 Rugby World Cup debacle where All Blacks jerseys were being sold up to $127.32 more in NZ than in the US?

High margins

Hamilton says companies don’t want to acknowledge there is a price problem in the New Zealand market.

“They are aware New Zealanders are paying more and so the more pressure consumers put on the better.

“Generally New Zealand is recognised for having a high profit margin and these companies can get away with these excessive prices and making profit.”

Hamilton says while some of the premium for overseas companies is due to the cost of importing and the reselling goods “someone is definitely making a profit”.

“Front Up was started to encourage a heck of a load of debate to put power back in the hand of the consumer and with more consumers pressing back the more change we can get.”

Hamilton says customers should challenge the high profit margins by buying direct from overseas, contacting retailers, talking to local MPs and “not taking the sticker price of an item as being what they have to pay” but instead negotiate.