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Price Rise For Lcd/plasmas


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Was thinking about this while out shopping yesterday, could not believe the people buying electronic items, I think your on the right track Kulfi.

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See thats where i have an issue. The cost of oil and raw materials dropped pretty much along with the crash of economies which was about 2-3 months ago. Why wil it take another 6 months for those effects to be felt? And why would wholesale prices go up 44% when the AU $ dropped max 30 cents which should really only attribute to about 30%. All seems a bit wrong to me. Plus also remeber that sporting goods industry is very different to elctronics. Electrical items depreciate very quickly. I think its very hard to compare it to many other industries where pricing is relatively static.

Many Raw material such as steel are negotiateing on a 12 month contract. Steel for instance, is negotiating in April and last for 12 months. Oil has dropped dramatically, but you buy it now, ship it refinery, ship it base producers for whatever (say plastic) ship to plastics manufacturer, ship to factory for asssembly.

Now remember these TVs dont just get pumped out non stop, that would be madness. Lets non stop produce the Australian version of said TV would be a quick way to go broke. Sony, Pana Aus etc will project sales and place initial purchase orders based on these projected sales, but they and the wrest of the world may get it wrong, too low or too high. So what this means is I place an PO today to the factory and they then put that order in the system into the worldwide queaue. Lets say its only 45 days, then there is 3 weeks to ship from Asia to Aus, so apply that process all of the way along and you get your delay in price drop, same scenario for price rise.

as for our 44% rise, 35% change in AU dollar (worse case scenario is it now cost you 50% more than in August 0.98USD to 0.65USD) plus the factory price rise finally filtering through in its final stage from the HUGE price rise in steel back in April and there is your 44%. Remeber a 33% drop means it is costing you 50% more to buy US again.

Now that is across the entire brand certain items actually rose 60% but you balance the cost across the entire brand to not freak everybody out.

As for AU dollar drop, more and more. Remember as the US is in the **** they want to buy more of their own dollar to help themselves. Our own reserve bank has bought billions of Au dollar in the past to prop it up. In times of worldwide insecurity you want to put your money into as sure a thing as possible so this puts a higher demand in the US dollar and drops the AU. As we cut our interest rates it signals to the world that we are unsure about our future and questions its stability. So our dollar will drop further.

Yes electronics depreciate quicker than sports industry but you cant just drop your prices when your business is dropping not due to price but because of uncertainty, need to maintain your margin to ensure your security or you become a self fulfilling professy and put yourself out of business.

I agree with comment re it not just one hit, as i said it me costing us 44% more but we have done a 20% rise first and will re asses in 2 months time how much more gets passed along

Edited by MESTOPHALIES
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Why would the AUD tumble even further ? I thought our economy was in better shape than the US, and their dollar is rising instead !

The most important issue here is whether the AUD can retain a stable exchange rate compared to the Chinese Yuan, Korean Won and Japanese Yen. Most TVs come from these countries, not the USA.

With the exception of the Japan and the YEN (which has had an even bigger change the the $US, 105JPY to 0.60JPY) I would be surprised if AU companies would acyually be buying in Yuan or Won, they would be done in US.

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Prices will rise. I am a wholesaler in sports industry and one of our major brands is costing us 44% more to buy than 6 months ago, this is due to to AUS dollar drop and factory price rises.

We have made, and still making, massive price rises among our brands. 20% for starters with another 10-20% to come.

As for prices not dropping while dollar was high, in effect they did. You did not notice it because they simply did not rise when we were all being hit with uge factory price rises due to tha massive increase in raw material prices.

We were able to offset factory price rises with the better dollar. Beleive me all irtems are way cheaper than they should really be, now it will flip the other way.

As we see oil and steel drop in price factory cost will drop, but we have to weight 6+ months before that filters through fully. By that time our dollar will have droppped even further.

Buy now, I am which is why I have stumbled across this thread, as I kick into full research mode.

Exactly the same here... We absorbed 8 rises in our goods over the past 2 years too. Some commentators here only see the retail end and don't understand that these past couple months and the next few ahead are very different times for importers. Only reason there have been limited or little change so far is that most of us work on a 3-5month order cycle and have been quite willing to keep prices down while we sell the existing inventories but with cost of replacements so high, and delays in the raw materials costs being passed on (not enough to offset dollar drop too), prices will simply have to rise.

If you want something don't be too slow. If it can wait then wait. It might just be 6-12 months before things start to drop again.

And to all the hopefuls, once the stock is gone, the manufacturers will all curtail business, reduce overhead (read jobs) and settle for lower returns, BUT not losses. They'll pull out of our piddling market before selling at a loss. That's why we've seen a reduction in the number of manufacturers. If you want to see what lack of competition brings, look at how much groceries have gone up since it has become a 2 company cartel.

Pfeff

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See thats where i have an issue. The cost of oil and raw materials dropped pretty much along with the crash of economies which was about 2-3 months ago. Why wil it take another 6 months for those effects to be felt? And why would wholesale prices go up 44% when the AU $ dropped max 30 cents which should really only attribute to about 30%. All seems a bit wrong to me. Plus also remeber that sporting goods industry is very different to elctronics. Electrical items depreciate very quickly. I think its very hard to compare it to many other industries where pricing is relatively static.

Because manufacturers contract raw materials and have to use them up first. It'll be months before the raw material drops get passed through to retail whereas the AUD increase is immediate. I know some importers who have cancelled large orders waiting for these drops to happen. It is also why the miners have cut back exports too. They are waiting for the prices to rise rather than sell at below extraction costs.

You are all dreaming if you think low prices are just going to go one without some rises. Yes I think even 30% rises for electonics is unlikely but 15-20% is entirely likely and certainly once the current stocks are gone it'll be a while before there back to today's levels. Just like it will be years before the stock market recovers and bulding starts and so on. We are in for a prtty tough 12 months people.

Pfeff

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Why would the AUD tumble even further ? I thought our economy was in better shape than the US, and their dollar is rising instead !

The most important issue here is whether the AUD can retain a stable exchange rate compared to the Chinese Yuan, Korean Won and Japanese Yen. Most TVs come from these countries, not the USA.

Why don't you read the financial sites to get a handle on this issue? But to repeat...

1. Most of Australia's imports are invoiced and paid for in US$ including all the currencies you mentioned.

2. The Jap yen has gone up a further 60% against the US$... no joy there...

3. China and Korea have currencies fixed by their central banks and have not gone down against the US$ either and secondly they have huge reserves of US currency.

4. The AUD/USD exchange rate is tied to commodity prices not the relative strength of our economy. Low commodity prices = low dollar.

5. All currency traders turn to the USD when there is financial trouble. We buy USD to hedge against drops, that pushes it lower and the cycle continues.

6. As our economy slows, the RBA drops interest rates here... more drops in the dollar.

7. We are nowhere near the slow down bottom yet and we'll see more interest rate drops (probably) next year.

8. My prediction is AND/USD at 62c by March, 65-67c in June, 70-72c in Sept and maybe back in 75c range by Dec 2009. But even my foreign exchange banker says its a close call as to whether it goes up earlier or sinks to below 50c. They say it could go either way yet.

One thing is for sure, we've got some pain to come.

Pfeff

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"Mr. Semenza [of DisplaySearch] expects that prices for LCD sets 32 inches and smaller will remain fairly stable. Retail prices on TVs 42 inches and larger will not decline as fast as they have in years past."

Found that comment interesting. Though as with many of these articles its the US we are talking about.

The other thing thats got me confused is why havent Sony panels attracted higher prices given they are late arrivals on the scene. That stock would not have arrived pre AU $ nose dive so they should reflect the current state of the AU $. Not to mention that their XBR's series dropped by about $1000 not 1-2 weeks ago. Im more inclined to think that prices will remain the same.

Edited by hazzad
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The other thing thats got me confused is why havent Sony panels attracted higher prices given they are late arrivals on the scene. That stock would not have arrived pre AU $ nose dive so they should reflect the current state of the AU $. Not to mention that their XBR's series dropped by about $1000 not 1-2 weeks ago. Im more inclined to think that prices will remain the same.

Probably because the big companies buy forward money.

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Well, I guess it's where the panel is manufactured. Japan is the most heavily in debt country in the world so anything made in Japan is likely to see a price increase as the world economy struggles through this financial crisis.

C.M

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Well, I guess it's where the panel is manufactured. Japan is the most heavily in debt country in the world so anything made in Japan is likely to see a price increase as the world economy struggles through this financial crisis.

C.M

Is anything actually made in Japan anymore?

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It does not matter much where the product is made its where the company is based that matters.

Well Samsung is based in Sth Korea so there goes that theory

Edited by hazzad
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I would sum it up like this -

Both sides of the "price rise" in 2009 debate have valid points. Either there will be a price rise as predicted or there will be a gradual softening in street prices as the current models end their life cycle. People on one side of the fence will be happy to be proven right and the other side will feel silly.

Let's wait and watch what happens because it's developed into a very lively discussion.

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Had lunch with a friend who works in electronics purchasing for a large dept store chain yesterday and she confirmed that they expected their cost prices to rise by the estimated amounts in the feb-march timeframe.

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Still sounds like scare tactics coming from direction of manufacturers through the wholesalers and so on... Unsold stock will thereby still be cheap come january till it's sold off (probably even cheaper). Following that we shall see what the price rise (if any) occurs AND if it does, how long can it last considering these are electronic goods...

No need to be impressed/scared by big posts using big words as the old adage says that an economist is somebody who can tell you tomorrow why the theories he had yesterday about what would happen today were wrong...

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Prices will rise. I am a wholesaler in sports industry and one of our major brands is costing us 44% more to buy than 6 months ago, this is due to to AUS dollar drop and factory price rises.

We have made, and still making, massive price rises among our brands. 20% for starters with another 10-20% to come.

Was that the reason why the huge Rebel Sport in my neighbourhood Westfield was empty on Saturday ? The rest of the Westfield mall was packed to capacity and K-Mart was making brisk sales of their 40% off footwear and clothing. I guess no one has the appetite to buy $250 Asics running shoes any more (not when you can buy gaming consoles for $300 and keep the kids happy).

Let these companies/stores go on with their price gouging. We'll see them in Kevin's handout line or Obama's soup kitchen in 2009.

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Is anything actually made in Japan anymore?

Panasonic plasma series 850 at Sharps LCD panels at least. Also the more expensive notebooks from Sony are made in Japan like the highrez Z series.

Was that the reason why the huge Rebel Sport in my neighbourhood Westfield was empty on Saturday ? The rest of the Westfield mall was packed to capacity and K-Mart was making brisk sales of their 40% off footwear and clothing. I guess no one has the appetite to buy $250 Asics running shoes any more (not when you can buy gaming consoles for $300 and keep the kids happy).

Let these companies/stores go on with their price gouging. We'll see them in Kevin's handout line or Obama's soup kitchen in 2009.

$500 full plastic Asics made in China are still going very well in my Westfield in Bondi Junction. At least in CBD TV prices went up last weak.

Edited by ageha
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Samsung already extended it's blu-ray player promotion till 31st of jan thereby putting the pressure on the rest (I'm sure they're doing this at a loss -> NOT), while if you have a look http://www.lasoo.com.au/portal/allcatalogues you can note that MYER's boxing day catalogue is having 15% off HDTV and associated goodies so I wouldn't be too concerned if I was you...

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Prices wil go down, any one putting their prices up will be shooting themselves in the foot (or head). LOL.

Sure there is alot of talk of how prices will go up, but people will not be buying goods at high prices, even at good economic times we expected the next model to be not only better but also cheaper.

In these times and future prices are going down.

Edited by dlpnut
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Samsung already extended it's blu-ray player promotion till 31st of jan thereby putting the pressure on the rest (I'm sure they're doing this at a loss -> NOT), while if you have a look http://www.lasoo.com.au/portal/allcatalogues you can note that MYER's boxing day catalogue is having 15% off HDTV and associated goodies so I wouldn't be too concerned if I was you...

Yep starting to see the boxing day catalogues in my letterbox and in the local rag, surprisingly (NOT!) no post xmas 30% rises as promised in SMH.

FYI BigW has a 32" 1366x768 LCD with HD tuner for around $600, Target has a 48cm 16:10 with DVD and HD tuner for $449. This latter price is interesting as I bought an equivalent from Target about 6 months ago (ie pre-dollar slide) for $399 but it only has a SD tuner. So $50 (or 10%) added for a HD tuner does not a 30% increase make!

Josh.

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I think it’s foolish to believe we will see lower prices here then in the US, that’s never happen in history and no reason to suspect it will in future. We are already at US street prices for many products and with the AU dollars decline its hard to believe this situation will continue when existing stock is exhausted.

Prices of TV’s will no doubt continue to fall long term, but I expect the price deferential between here and the US will return to want it was before the rise in the AU dollar to near 1:1 parity with the US dollar.

It’s not logical to assume local importers and retailers can operate at lower margins then their US counterparts with much greater economies of scale just to make up for the currency differential.

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Yep starting to see the boxing day catalogues in my letterbox and in the local rag, surprisingly (NOT!) no post xmas 30% rises as promised in SMH.

The press releases threatened a 30% price rise in Feb 2009, after the holiday season ends. We can't start cheering just yet.

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The press releases threatened a 30% price rise in Feb 2009, after the holiday season ends. We can't start cheering just yet.

Various articles were not very specific, "by February", "early 2009" etc type phrases were mentioned. It's just hard to see prices going up, if they don't dare to put them up in January which is a quiet month, how will they do it later as economy slows further and more jobs are lost?

I saw a few of the TV models which sold out during xmas are now due back in stock by mid jan with even lower prices, so have to wait a few days to see if brands other then Samsung extend their bonus offers to determine the value. Regardless, it seems no rush if it's supposed to be Feb price rise anyway, I'm waiting and not worried.

If only they lifted the prices to give me an excuse to wait for 3rd generation of LED backlighting heh, am not quite satisfied with 2nd generation compared to non LED backlit TVs...

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Sticking your head in the sand does not make the price rise go away, say all you like folks, facts are facts, the FX problem is not going away.

The only ones sticking their heads into the sand would be those raising the prices, if they cant see the current economy and where it is heading.

They can raise as much as they like if they only want to sell ONE panel a week and survive, good luck on them.

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The only ones sticking their heads into the sand would be those raising the prices, if they cant see the current economy and where it is heading.

They can raise as much as they like if they only want to sell ONE panel a week and survive, good luck on them.

Selling a lot for less is not always the better business model. They know exactly what they do if they raise the prices.

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Selling a lot for less is not always the better business model. They know exactly what they do if they raise the prices.

Are you suggesting selling a lot less (goods) for alot more (dollars), is a better business model.

They sure do know what they are doing, they are trying to scare the consumer.

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Are you suggesting selling a lot less (goods) for alot more (dollars), is a better business model.

They sure do know what they are doing, they are trying to scare the consumer.

Yeah, it works out very well in some areas.

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Yeah, it works out very well in some areas.

Only if you are producing Ferraries and Lambos, or any EXOTICS, the goods we buy dont fall into those areas, therefore I can see it hapenning or working.

I cant see panasonic producing in Europe, all hand made and asking big prices. Those spots/markets are alreday taken.

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TV’s are dirt cheap at the moment, there is A LOT of room for price rises.

We where paying four times as much only about 3 years ago and it did not stop people buying then. A 10-20% price increase will not stifle demand because the price is still low in real terms and most people who are seriously interested in a TV purchase will go ahead anyway because they want the product and can still afford it. $300 extra on a $2000 purchase is not going to break the bank, if it does the prospective purchaser was looking to buy something they really could not afford in the first place.

There is no incentive for importers or retailers to sell TV’s at prices that are not profitable, so even if prices don’t rise much, future price drops will be delayed to regain margin.

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Are you suggesting selling a lot less (goods) for alot more (dollars), is a better business model.

They sure do know what they are doing, they are trying to scare the consumer.

Put simply, if you are not profitable, you can't sell any.

They are not here as a non profit organisation, no profit no staff, no growth, no suport..........no existance.

its not selling for a lot more dollars it is simply trying to maintain margin to be profitable.

the facts are simple, if it is costing you 50% (USD) or 75% (YEN) to purchase the same item, you must raise your prices, especially as your raw material for the items you are buyong now cost more than 12 months ago.

give it another 6-12 months for the drop in raw material prices to come through then we will see.

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Just found this link

Sorry if someone has posted before

http://www.connectedaustralia.com/News/Bre...19/Default.aspx

Average increase of 9% in plasma and LCD

"We have worked particularly hard to ensure that our popular Home Entertainment range remains as affordable as possible. For example, in our most popular category of Plasma and LCD panels, we expect to see an average increase of around 9% on the current range, a figure lower than market predictions."

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