Questioning Our Prices... Look no further; you've come to the right page!

... Being an agent is a tough task for anyone!

Although Audio Tweak aims to please all our clients, we try and please both the End-Users while treading a very thin line in trying to "also" accommodate some of our Dealers, thus offering the best possible compromise price-wise. This is indeed a challenging task for any agent/importer!

As with most products in South Africa, 3 margins have to be included (3 tear distribution network):

1. A smaller margin for the Agent/Importer/Distributor (in this case, us).

2. A bigger margin for the Resellers (think of them as the bees working for the colony and the queen), and the guys with the Big overheads!

3. a small margin for our Co-Distributor (also selling to their own Dealers)

Therefore, our prices often include not just Our margin but the Dealer margin.

When Audio Tweak buys bulk (from the factory), there are two specific companies out of the many we represent that trade on the internet at just about "Factory Direct", and as a result they are offering less discount to their Worldwide Distributors due to their "negligible margins";

These specific companies (which we represent) are:

1. OPPO Digital

2. Benchmark Media

3. NuForce

This means that by the time those products land here, they are already the same if not more expensive than the retail price in the US!

Prices displayed on the internet from US companies exclude the "in-land" VAT, so comparing their prices with ours is completely inappropriate unless you add the VAT into their advertised price.

It is however fairer to scrutinize the UK prices + their VAT versus OUR prices because they too go through the same procedure than South African Importers/Distributors do (although with cheaper freight rates) when importing from USA factories. For instance, OPPO products are sold direct from the UK by the Agent/Importer and are therefore cheaper than our prices because they don't have resellers!

Freight charges from a USA factory to the UK are a lot cheaper than shipping the same product from a USA factory to South Africa.

In South Africa, some items (OPPO DVD players for instance) include Advalorem Duties (a type of tax, in effect a duty!) which is 7% the value of the goods. This even after SARS claims that an item is Duty Free!!!

Some more points to consider:

1. Clearing agents take their cut. 2. SA Banks interests fees are shocking as oppose to the US or UK, not to forget their transfer commissions. 3. The end-user ends-up paying around twice the initial (landed) VAT when the product retails from the reseller. 4. The 14% VAT makes a big difference to the final price, so when buying think of the price minus the VAT.

After-Sale Service; does it affect the price?

Finally and most importantly, our prices have to cover a no-nonsense after-sale service strictly at our expenses! Should a product fail whilst that client lives in the USA (had he bought it there), this product would be sent literally 'round the corner at the factory (via a dealer/reseller). NO cost to the reseller, NO freight, NO after-sale service/labor at the reseller's expense (luck guy)! The faulty unit gets returned to the factory/headquarters, and that's it! What a pleasure!

In South Africa as Agents, OUR duty is to:

1. Import replacement parts from the factory at OUR expenses in order to perform repairs locally.

2. Pay our technicians at OUR expenses.

3. Establish a network of Technicians Country-Wide to serve our clients wherever they might be.

All this for the client's ultimate Satisfaction Guaranteed!

Ahhh, what we have to go through for our clients... Some of them understand this and support us to this day :-)

So for your information, all of the above is built into the price. Service is a price you can't pay enough for. If that's not what you're after, buy from elsewhere/cheaper, and good luck! The same applies for other brands in this country. I certainly haven't bought a Canon camera yet that sells for the same price as in the US of A? In fact, I've often paid for my SLRs in some case up to 2/3 or double the $ price!!!

Here's a typical pricing example:

-  Let’s assume that I pay $ 110 factory cost for an item.

-  The item lands here (cleared + Advalorem + VAT) for R 1650,00.

-  This product retails for $ 229 on the internet.

-  Say I put a 25% margin on top of that for my own pocket (perfectly normal)?

How I’m I suppose to give a 25% or 35% dealer-discount for quantity orders and stay in business?

I therefore challenge you to try and stay within the R 3500 retail price in order for you to make something on it while accommodating a fair margin to the dealers?

Try and work it out and see if you’ll manage?

What happens if the client get's clever and decides to buy from eBAY?

-  Advalorem Duty The OPPO BDP-83 Zone/Region Free costs $ 790

-  Advalorem Duty in South Africa (customs) = 20% for end-users who don't have a business and an Import/Export code!

-  VAT = 14%

-  Price is now probably more than our price!

-  No after-sale service! No warranty repairs

-  You're on your own

Before deciding not to give us a go because you may think that our prices are unfair, please investigate the above points or email us at support@audiotweak.co.za for further queries?

Hope this helps?

Yours truly;

Ramsey