Taxtation On My Belly!

A couple years ago, my dad would ride his motorcycle to Johor Bahru and buy our groceries there. It was well before Malaysia decided to pull up a goods limit to every tourist. Many would suggest a normal trip to the NTUC or the little neighbourhood market to get your needs but if you really do the math, plus the currency conversions, it was really cheaper to get it in Malaysia. After all, it's all in half price.

I don't really understand. Why must there be a huge difference in prices of similar goods? It gave my brain a stir when I came across this article at CNET Asia. In the article, they did us a favour by comparing 2 identical notebooks of US & SG and highlight the price difference. Even after a S$230 shipping cost [o.0] the notebook is still cheaper than the Singapore model, BY S$800!

CNET Asia even asked Sony Singapore about this discrepancy and what they replied was still vague too me.

Pricing policy is different for different region, subject to market size and demand. In this context, the US is a large market for Sony.WHAT? Even after the many years of diplomatic setting and the sacrifice of lives for equality, you're saying that we (Singaporeans) can't get the same price as our US conterparts?

Taxation issues. The pricing you see on the US Web site does not include taxes, while the Sony Singapore pricing does.Too vague. The only tax I know of is Singapore's GST. And that's only 7%. What tax rakes up so much that there is a S$800 price diff?

The US pricing does not include shipping insurance versus when one buys from a Singapore store, there is a 1-year warranty included. S$800 can buy you 3 years of Macbook Pro Applecare. DIG THAT.

Hey Sony, you know why your Vaios are not popular here? IT'S EXPENSIVE! Don't get me wrong, Sony does have quality goods but I don't think paying S$800 bucks more is a wise choice. Especially when you have Vista installed. Yuck.

So what is the problem here? Why is the price difference so different when there is a geographical challenge for companies? Shipping shouldn't hurt much. The article is right about that 8kg load that costs S$230. Check here. This leaves us with S$570 to rational about.

I'm just shooting blindly here. Maybe it's the currencey exchange? Maybe it's the cost of customer satisfaction when buying in Singapore? Maybe it's the assurance of an avaialable product? Maybe it's the cost of a freaking brand name or maybe, just maybe, Sony decided to charge more to earn profits. Well, screw you Sony.

I don't mind paying more for a quality good. But Sony is kinda walking in Apple's footsteps. They want to project their products as a Veblen good. They figure that if they rake up their prices, they will accelerate their output. But no Sony, Apple ain't playing Veblen. They are playing Giffen goods. They see themselves as the only one in the business, in the business of creative people that is. In my opinion, Apple wants to be unique. They don't want to take over the world. Kudos to you Apple!

Price difference is inevitable. But sometimes, this might spur small start ups in local Singapore to innovate more. Thus, more products for us, consumers. Sometimes, I love economics.