Why Are The Furnitures in Australia So Expensive?

pilotyuan on 06/06/2018 - 12:16

My story:

Recently I was looking for furnitures for my new home.

I was looking for some stylish furnitures but somethings I didn't understand.

All furniture shops are show rooms only and the lead time is usually 12 weeks. Pretty much make to order in some overseas factories.

However the mark up seems so high, for example:

A nice coffee table like this is $995, exclude delivery. No discount availble.
https://curiousgrace.com.au/collections/coffee-tables-side-t…

If I order from a China factory and get the item forwarded to my Australia address, I would have been looking for $500 max deliverred.

I understand the store needs to pay rent, staff and GST. But wasn't a 100% mark up is too high in their business model?

What am I missing something here?

Home & Garden

Comments

  • cureforanitch on 06/06/2018 - 12:26
    +1

    Try living in New Zealand!

    • stumo on 09/06/2018 - 15:53

      Nup. We had a lounge suite we bought at that place bottom of wairau rd in Ak, cant remember what the shops called funiture wharehouse? but it was the big one in the area at the time. Its all made in china crap. Cost us $2200NZD delivered. Moved to melbourne a year later and found the EXACT SAME suite at Nick Scali for $4999AUD.

    • Ostrk on 09/06/2018 - 18:24

      New what? is that some sort of food?

  • gaz3342 on 06/06/2018 - 12:28
    +10

    Ikea?

    • pilotyuan on 06/06/2018 - 15:45
      +21

      No offence, I meant..stylish

      • MrGrinchy on 07/06/2018 - 17:40
        +9

        I got a great unpopular coffee table on wheels, that has shelving, not that crap thats shaped like a oil spill but useless.

        Form, over style.

        Ikea basic - but useful. My house is not a nightclub.

      • Typical16-bitEnjoyer on 08/06/2018 - 09:01
        +3

        Stylish, cheap, quick delivery

        Pick 2

      • smartazz104 on 08/06/2018 - 16:53
        +2

        No offence, I meant..stylish

        Then be prepared to pay the price.

        • virhlpool on 09/06/2018 - 00:46

          Why only so pricey here in Aus is his question. Probably not so expensive in other countries.

    • [Deactivated] on 06/06/2018 - 17:56
      +19

      You know Ikea is like half the price of Australia in other countries. Australia tax is strong in furniture.

      (BTW OP, you don't put an S on the end of furniture, it's plural).

      • follow on 07/06/2018 - 15:16
        +23

        Furniti

        • cameldownunder on 08/06/2018 - 17:04

          De furniti pricebus non est disputandum

      • chumlee on 08/06/2018 - 07:19

        Are there other taxes besides GST on furniture?

        • WhatWouldBiggieDo on 08/06/2018 - 11:15

          Import duty

        • D C on 08/06/2018 - 14:03

          … and things like fumigation, inspection, storage, tariffs (booze & smokes mainly) etc.

  • [Deactivated] on 06/06/2018 - 12:28
    +15

    You're missing the fact that you're in Australia and you are presumably earning Australian wages.

    You get paid more, so do others.

    • Almost Banned on 06/06/2018 - 13:42
      +7

      Did you miss the bit where the furniture is made to order in o/s factories and shipped here? Presumably based on o/s costs.
      Only a couple salespeople and the showroom costs are local.

      • [Deactivated] on 06/06/2018 - 13:47
        +2

        The import duty and GST are also local (does not apply to self importing as value is <$1,000).

        Rental, registrations, staff, advertising, warranty liabilities… It's a long list really.

        • pilotyuan on 06/06/2018 - 15:55
          +1

          I do understand the costs are much higher here. I was thinking if the mark up is reasonable or just greed.

        • [Deactivated] on 06/06/2018 - 15:58
          +4

          @pilotyuan:
          A bit of both but a business cannot survive for long on just greed alone.

          As mskeggs pointed out, if you're good at spotting oem manufacturers and able to arrange delivery from China, you should start a business. That's how capitalism works.

        • ItsMeAgro on 07/06/2018 - 21:53

          @pilotyuan:

          Nope, just greed.

      • gimme on 07/06/2018 - 16:55
        +3

        "Only a couple salespeople and the showroom costs are local."

        Do you know the % that payroll and real estate add to a business' cost base? You'd be surprised

    • anonymous01 on 07/06/2018 - 21:29
      +1

      That must explain the house prices!

    • virhlpool on 09/06/2018 - 00:50
      +3

      and you are presumably earning Australian wages.

      You are mistaken. Australian average income isn't high at all (in fact, other currencies go much further in terms of buying power comparing absolute numbers i.e. 5 USD vs 5 AUD). Our minimum wages are high, I totally agree, but high prices of literally everything nullifies the effect of even higher minimum wages.

      • [Deactivated] on 09/06/2018 - 08:20
        -1

        Relative cost of living to minimum wages does nothing to reduce the cost of living (?). High cost of living in Australia does not nullify the effect of Australian wages being higher than China's in relation to cost of goods. Hence why cost of living in Australia is higher. Takes some serious mental acrobatics to come to that origami logic.

    • ozlab on 09/06/2018 - 16:16

      Paying higher tax?

    • retiredfeline on 06/06/2018 - 12:36
      -2

      They have been bought up by the sheeps.

      For OP: https://www.quora.com/For-which-English-nouns-are-the-singul…

      • D C on 06/06/2018 - 20:00
        -1

        Why?

        • idonotknowwhy on 08/06/2018 - 14:05
          -1

          I did as well

        • D C on 08/06/2018 - 14:05

          @idonotknowwhy: Ok, why?

        • idonotknowwhy on 08/06/2018 - 14:06
          -1

          @D C: I wish I knew

        • D C on 08/06/2018 - 14:16
          +1

          @idonotknowwhy:
          Explains a lot.

          If you like that sort of thing look at this: https://www.ozbargain.com.au/user/219957 and "cringe" at the number of apostrophes that are missing. Never mind the typos.

          Content is a bit meh, but that's irrelevant. At least the gay anal sex stuff has scrolled out of view.

          Ah grammer nazi's, death can't come quickly enough for them. That's your legacy in life - "Oh well kids, I spotted trivial errors in short-lived forum posts." Well done.

        • idonotknowwhy on 08/06/2018 - 14:21

          @D C: Why do you say that?

        • D C on 11/06/2018 - 19:59

          @idonotknowwhy:

          Why do you say that?

          Say what?

          Wonder why you pile onto 'grammar nazi' posts?

          Feel the need to say you 'cringe' as well for something so trivial, which if I check your comments will be just as bad, if not worse?

          Think this stuff has any value?

          Think you are making a contribution to the world?

        • TheBilly on 15/06/2018 - 17:08

          You must be gays and into anals sex. Im flattered you put in the effort.

    • barbarella on 06/06/2018 - 13:18
      +60

      We live in a multicultural society. For some people English is not their first language. Forgive their grammar errors graciously.

      • altomic on 06/06/2018 - 13:39
        +106

        person - "sorry for my mistakes, English is my 4th language"
        aussie - "yous r in Strayla,ya pharkin moron, learn to speak the bloody language, stupid immigrant"

      • TheBilly on 06/06/2018 - 17:20
        -4

        I thought it was handled graciously. Ungraciously would've been something like, "oi, it's furniture you twat".

        • smartazz104 on 08/06/2018 - 16:49
          +4

          I think the word you're looking for is "obnoxiously".

      • HighAndDry on 06/06/2018 - 17:53
        +1

        Multicultural != bad English.

        I'm "multicultural" and I manage to do it, I think it should be expected.

        • nomoneynoproblems on 07/06/2018 - 00:58
          +6

          Except he was coherent. Like he was saying forgive the grammar error.

        • rompastompa on 07/06/2018 - 21:42
          +1

          Or, maybe, you can use a comma or four, to get your point across, I think.

        • [Deactivated] on 07/06/2018 - 23:22
          +12

          " you should trying to improve your english"

        • johnno07 on 08/06/2018 - 07:14
          +3

          @voolish:
          Muphry's law strikes again.

        • [Deactivated] on 08/06/2018 - 12:23

          username checks out

        • abb on 08/06/2018 - 17:32
          +4

          complains about poor "english"

          English is a proper noun, and therefore should always have a capital E.

        • HighAndDry on 08/06/2018 - 17:36
          +1

          I mean, the guy did say in another comment:

          Not at all. That just a little problem I need to fix.

          And later:

          Thanks, lesson learnt.

          So he's working on his English, and even appreciate the correction. It's kind of like picking on fat people in a gym. No point, they're already there. Outside the gym though… (I kid I kid…)

        • OzzyOzbourne on 09/06/2018 - 13:01

          I can see how much you have progressed in life.

      • virhlpool on 09/06/2018 - 00:54
        +1

        Forgive their grammar errors graciously.

        How will they ever learn it then? Depends on how you see it. Graciously pointing it out with correction is a favour one should do, I would say. It helps not only the person who wrote incorrectly, but many others who are reading it and have poor grammar too. Just graciously ignoring won't help anyone learn/ improve. Not being rude is the key though.

    • pilotyuan on 06/06/2018 - 14:51
      +18

      Thanks, lesson learnt.

      • D C on 06/06/2018 - 17:43
        +18

        I wouldn't worry too much.

        Some people have nothing better to do with their lives except to point out minor errors. Says more about them than you.

        • pilotyuan on 06/06/2018 - 18:32
          +4

          Not at all. That just a little problem I need to fix.
          I guess the grammar mistake actually attract more replies than the other posts.
          People say whatever they like to say. Just take it on the bright side.

        • D C on 06/06/2018 - 20:00
          +7

          @pilotyuan:
          Eh.

          grammer nazi's are annoying pedantic dicks who need to get a life.

          I find 'missing shift-key syndrome', eg https://www.ozbargain.com.au/comment/6021039/redir indicating a certain laziness to be a worse 'crime', but yeah, whatever. To B or not to b, who cares.

          Down vote away, losers!

    • D C on 06/06/2018 - 17:41
      +5

      He's aware of capitalisation, punctuation and paragraphs which is better than the average poster (even on this post).

      Just needs to turn auto-correct on.

    • elf888 on 07/06/2018 - 13:40
      -1

      y we still care grammar on Internet chats….
      r we still live b4 the 90s?

  • Nugs on 06/06/2018 - 12:40
    +9

    it's $995 because it is 'designer'.

    like a nappy bag.

    .

    • pilotyuan on 06/06/2018 - 14:55
      +1

      Yeah, at one moment I was nearly convienced, until I found other stores selling the same stuff.

      • [Deactivated] on 08/06/2018 - 06:04
        +2

        Yeah, at one moment I was nearly convienced

        Read it as : Yeah, at one moment I was nearly conceived

      • goraygo on 08/06/2018 - 09:53

        Look at he Chinese furniture shop in Auburn within the same building of MSY. They are cheaper but not everything stylish

        • goraygo on 08/06/2018 - 09:53

          And they assemble the thing for you before delivery and still cheaper!

  • mskeggs on 06/06/2018 - 12:42
    +22

    But wasn't a 100% mark up is too high in their business model?

    You have a very naive view of what profit margins businesses must charge to be successful. Please do not look in the accessories section of JB or Harvey Norman!

    Why haven't you ordered the $500 table from China if it is so straightforward? Is it because it actually isn't as easy as you make out? My experience on Aliexpress is the item received often doesn't look as good as the pictures.

    • pilotyuan on 06/06/2018 - 15:08

      I am actually thinking seriously to try that. Judging from the photos of other buyers. The actual product looks about right to me.
      Delivery and the customs charge is another story. But I have friends buying large rugs from overseas with no trouble at all.

      • mskeggs on 06/06/2018 - 15:11
        +11

        I hope it works out. You might sow the seed of a new business if you are good at it.

        • Gina Rinehart on 07/06/2018 - 23:09
          +8

          Next minute, OP is importing these coffee tables and selling for $995

        • pilotyuan on 07/06/2018 - 23:24
          +5

          @55: More likely $994 to make it just

        • orangetrain on 08/06/2018 - 08:46
          +3

          @55: then lobbying to keep GST on <1000 goods while users on ozb say they'll boycott pilotyuan. Then Broden.

  • Donaldhump on 06/06/2018 - 12:42

    why do you think

    some furniture is cheap because it is utter rubbish made from week wood and materials.

    why is furniture from super amart cheap? because it is cheap made junk that will last you next to no time

    • dcep on 06/06/2018 - 13:10
      +4

      you can get genuine marble stone table that lasts forever for $29 from kmart

    • pilotyuan on 06/06/2018 - 15:19

      The cheapies might be just junk. That was a truth when I was working as a buyer in an importing company.
      I was not comparing the cheapest on the market but something within a decent price range.

    • bad hombre on 07/06/2018 - 17:04
      +2

      Week wood would actually be quite strong I would think. A week is a long time :)

  • Halo375 on 06/06/2018 - 13:00
    +19

    Pricing strategies are not driven by cost but by what the customer is prepared to pay. A lot of furniture is overpriced because a lot of people associate a higher pricer with higher quality.

    Welcome to the world of marketing.

    • GG57 on 06/06/2018 - 13:31
      +6

      Correct.
      I was told by a furniture buyer (for a large retailer) that when visiting the production factories in China and choosing designs, they were asked to choose their price-point. The furniture would be made to specs aligned with that price-point, such as lower quality leather, foam, etc.

    • [Deactivated] on 06/06/2018 - 17:58

      In Australia. The same doesn't apply in other markets, its an Australian notion that equates price to quality. Why do you think people are willing to pay double the money for an Audi over a VW?

      • iand on 07/06/2018 - 22:51
        +1

        In New York a Birkin Bag sells for 10's of thousands a Walmart bag sells for $10 I don't think it's just Australia

        • virhlpool on 09/06/2018 - 01:03

          Unfortunately, KMart or Target bag in Australia sells more than double the price of Walmart. What's the logic there? Let's keep Birkin aside for a moment. Apple-to-apple.

          Not just bags, even burgers. Shoes. Clothes. Gadgets. Electronics. Cars. Petrol. Homes. Again, compare similar brands only to keep it fair.

      • abb on 08/06/2018 - 17:35
        +1

        It's a psychological bias that's common worldwide…

        https://psychologydictionary.org/price-quality-relationship/

  • dcep on 06/06/2018 - 13:04
    +1

    Seems cheap to me.

    $29 for new marble stone table.

    https://www.news.com.au/lifestyle/home/interiors/customers-r…

  • andydandy on 06/06/2018 - 13:16
    +2

    There are certain warehouse stores which offer reasonable rates. Try one opposite Belmore station

    • pilotyuan on 06/06/2018 - 15:22

      Thank you, will definitely try that.

  • websterp on 06/06/2018 - 13:26
    +10

    Welcome back Stephanie360…We missed you!

    • pilotyuan on 06/06/2018 - 15:24
      +3

      Hubby here

      • KLoNe on 09/06/2018 - 14:14

        Stephanie360, why is your hubby such a cheapskate?

  • Richardc on 06/06/2018 - 13:33
    -1

    100% markup is too high? lol
    even 300% is not high for the low sales volume in Australia.

  • Fier2 on 06/06/2018 - 13:36

    Well, i think you answered yourself. You are looking in a specific shop when you could just go to kmart, ikea, amart,… if you walk in the shop and look at their item y that mean you are willing to pay for it so why do you even bother asking how much?!

    • pilotyuan on 06/06/2018 - 15:34
      +1

      What I found out is if products from stores like IKEA then price is usually very good. It is for a fact that some items in IKEA AU are cheaper than in IKEA China as they might be made in Malaysia or Vietnam.
      However, if something with stylish or design feeling then the price is went through the roof.

  • NotAnAudiophile on 06/06/2018 - 13:38

    I only buy Ikea now. Stylish pieces lasted me years.

  • Clear on 06/06/2018 - 13:57

    Downside of everyone buying their furniture from art and IKEA is that every house on Realestate is now covered in them.

    • MessyG on 07/06/2018 - 17:06
      +1

      That's what Ikea hacks are for 😎

    • freakatronic on 07/06/2018 - 19:23
      +1

      Only a downside if you care about what furniture anyone else has.

      • Clear on 07/06/2018 - 19:29
        +2

        Yeah I do. Can't have my instag looking generic.

        • macrocephalic on 08/06/2018 - 11:19
          +1

          My furniture is artisinally recrafted by my dogs. One of a kind.

  • tryagain on 06/06/2018 - 14:10
    +8

    Let's have a look what a showroom in that area rent for https://www.commercialrealestate.com.au/property/368-militar…

    Factor in staff costs, costs associated with providing warranties, tax, time to source products etc etc…

    If they are only making $500 on the coffee table with a relatively low volume, they would likely be bankrupt in no time. In retail in Australia, the product is often far cheaper than the associated retailing costs.

    • pilotyuan on 06/06/2018 - 15:42
      +3

      I might had underestimated the rental cost.

      Now I feel the pain in retail.

      • Soluble on 07/06/2018 - 15:34

        There's some serious pain. Rent is a fraction of the cost to run the business. My GP is 21%. Once everything else is done and dusted actual earnings are around 5-7%. If a big box hits my area then that can be cut significantly.

        • BartholemewH on 08/06/2018 - 07:30

          What industry? You really need 30% GP in a lot of cases to get ahead.

  • [Deactivated] on 06/06/2018 - 14:28
    +12

    Grand Sale! Grand Sale! Grand Sale!

    At Brunswick and Footiscray.

    Franco Cozzo means furnitures and furnitures mean Franco Cozzo.

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