American products and european prices

DLC86

Fractal Fanatic
I'm not starting this thread to bash FAS or G66 but because I want to understand, there's something I really don't get.
First a few examples:
Strymon timeline: US list price 449$ - EU 449€
Eventide timefactor: US 499$ - EU 475€
Line 6 helix: US 1499$ - EU 1469€
Fractal FX8: US 1349$ - EU 1600€
As you can see other brands offer here in europe a price that's roughly based on the USD-EUR exchange rate, while fractal's prices are charged by customs and VAT taxes that normally apply when you import from overseas. What I don't get is why those other companies seem to be immune from those taxes? Did they find a way to not pay them? Or do they effectively sell their products at a lower price over here?
 
Do those companies where you found the differences have a single authorized distributor or do they sell wholesale to big stores?
 
Big stores.. but also kemper sells in big store in US, so I think that's not the problem
 
Big stores.. but also kemper sells in big store in US, so I think that's not the problem
Kemper's 1600€ is more than $1800, since Dollar to Euro exchange is at about 1.12 to 1. A selling price of $1900 is just 5% over the regular price. If they'd get the Kempers at a 5% reduced price they'd be getting 10% profit, which is barely what keeps a store going.
 
Look at Mesa Boogie stuff in the same price range or the higher priced PRS stuff...it's the same like with g66.
You can not compare the market rules when it's about low pricing mass products on one side and unique high pricing products at the other side. That are different markets and the rules are all different there.
 
Kemper's 1600€ is more than $1800, since Dollar to Euro exchange is at about 1.12 to 1. A selling price of $1900 is just 5% over the regular price. If they'd get the Kempers at a 5% reduced price they'd be getting 10% profit, which is barely what keeps a store going.

You can't stay open at 30% and eat, that's why small businesses can't survive against big box stores who pay far less for inventory. Half of the boxes' profit is in the their purchase pricing.
 
Look at Mesa Boogie stuff in the same price range or the higher priced PRS stuff...it's the same like with g66.
You can not compare the market rules when it's about low pricing mass products on one side and unique high pricing products at the other side. That are different markets and the rules are all different there.
I think you're right, what matters is the number of sales.. so to answer my question: big companies effectively earn less money in europe just because they can and prefer to sell more units

You can't stay open at 30% and eat, that's why small businesses can't survive against big box stores who pay far less for inventory. Half of the boxes' profit is in the their purchase pricing.
I agree, stores don't buy items at the same prices we do, and anyway 1600€×1.12=1792$, and 1900$ is the lowest price I could find, most are selling them around 2000$.
 
Also remember that prices heavily depend on the customer base.

For example, Fractal is relatively unknown in the EU. Almost no guitarist I know ever heard of Fractal. But they do know Line 6 or Kemper. Kemper sells in the big music stores and is very visible, whereas Fractal is online-distribution only.

This creates a different customer dynamic, in which you have to market your product in comparison to it's competitors. L6 and Kemper probably try to aggressively price their products to keep Fractal out of business in the EU (except obviously for the informed few that know Fractal around here).
The word of mouth weights a lot in the music industry. The more people you can reach with aggressive pricing, the more people will in turn convince other people to buy the same.


On a side note: you also pay for distribution infrastructure. G66 probably takes a large cut to keep their business running, considering its a german company and even the minimum wages in germany are high. The large companies (that goes especially for Line6) simply have the infrastructure and numbers to keep the market prices low.
 
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Yes the EU price is higher than the US but I think that's worth it. I prefer having a distributor like G66 and pay a bit more than having to deal with annoying/incompetent resellers. I bought my FX8 to G66 and I must say that the service is top notch


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Yes the EU price is higher than the US but I think that's worth it. I prefer having a distributor like G66 and pay a bit more than having to deal with annoying/incompetent resellers. I bought my FX8 to G66 and I must say that the service is top notch


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No doubts on this ;)
 
Don't blame Fractal, Kemper, Mesa or whatever you want to buy, blame the EU and other governing bodies for slapping import taxes and then local purchase taxes on top. The exchange rate may or may not help you depending on whether the bankers have screwed it up that week or not!!

I accepted a long time ago that if I wanted to buy quality gear built in the USA (I am talking Mesa, Parker and now Fractal), that I would have to pay roughly the same in pounds that guys in the States pay in dollars. It is what it is.
 
anyway 1600€×1.12=1792$, and 1900$ is the lowest price I could find, most are selling them around 2000$.
I said "at about" not exactly 1.12 to 1. The exchange rate when I wrote that gave me exactly $1810.36 as a result.

Still, stores need that difference to keep going. Smaller stores will have to price them higher and super big stores like Thomann or Musicstore will be able to get better deals by buying hundreds of units in one go.
I tend to prefer big stores, since they can offer me a better deal, but in this case that's impossible.
 
I live in Canada. There is an invisible line between us and the USA, and yet it's the same bunch of crap.

I bought an ESP EII MII last year it gets shipped from Japan, and it was $1599 USD + tax depending on which state you live in. I paid just shy of $2200 CDN after exchange rate, Duty and Taxes. The $120 case cost me $200.
 
All I can say is blame (insert name of the country you are living in) import laws.

No sane country in the world will tax it's own exports. But they will make sure that importing is a living hell. So whenever you are ordering something from the outside, you are screwed royally. It has always been like this.
 
I think the problem is also a sort of incompatibilty between the tax systems in different countries. For example if I want to sell an item outside EU i can uncharge the VAT from the price (effectively selling it at 22% less) so that the customer will pay the taxes only in his country on the item he's purchasing. From what I understand this is not possible in the US because it's sold at full price even if it's being exported.. maybe you don't have vat or something equivalent?
 
I think the problem is also a sort of incompatibilty between the tax systems in different countries. For example if I want to sell an item outside EU i can uncharge the VAT from the price (effectively selling it at 22% less) so that the customer will pay the taxes only in his country on the item he's purchasing. From what I understand this is not possible in the US because it's sold at full price even if it's being exported.. maybe you don't have vat or something equivalent?
Wasn't it more like that in the US, the VAT does not have to be included into the listed price (and will be charged seperately)?
In the EU, you always have to include the VAT in the listed price. That's why you can subtract the VAT if you sell outside the EU, since VAT is always paid in the importing country.
 
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I don't know, from what I see in american stores there's no mention of vat or taxes under the price, maybe they don't have it anymore? Someone from the us can answer
 
Hi Little Onion (Zwiebelchen),
In the states, the prices on almost everything from a pack of gum to cars is listed WITHOUT tax. It is called "sales tax" in the states, not "Value Added Tax" like in UK, the EU and other places. Sales tax varies according to the state. Each one has a different percentage, usually somewhere around 10%. I used to live in L.A. It was around 8%.
Liebe Grüße
 
Hi Little Onion (Zwiebelchen),
In the states, the prices on almost everything from a pack of gum to cars is listed WITHOUT tax. It is called "sales tax" in the states, not "Value Added Tax" like in UK, the EU and other places. Sales tax varies according to the state. Each one has a different percentage, usually somewhere around 10%. I used to live in L.A. It was around 8%.
Liebe Grüße
So if you buy an FX8 listed at 1350$ you pay 1350$+10%=1485$?
 
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