October 19, 2013

Horse 1556 - Hidden Orange Christmas Pudding vs Hidden "Australia Tax" Pricetags

For some time now, consumers have been aware of a so-called "Australia Tax" on certain products. Partly because Australia is roughly three miles away from Mordor and a million miles from everywhere else, retailers know very well that we can't just pop over to the next country and but the same product as easily as you could in say Europe. Consequently we pay more for Shoes, Clothing, Computer Software, Motor Cars etc for no discernable reason... EXCEPT NOW!


Heston - Christmas Pudding Hidden Orange
Recipe created by Heston Blumenthal - 1.2kg
- from Coles


Heston from Waitrose hidden orange Christmas pudding 1.2kg
- from Waitrose

One of the consequences of only having two major supermarket chains, apart from them having a market duopoly and short-changing farmers and annoying Bob Katter, is that they haven't separated and diversified along the lines of class. Britain has a well-defined class system and so supermarkets like Lidl and Tesco cater for the lower and middle classes whereas supermarket chains like Sainsbury's and Waitrose aim at a higher end of the market.

It's hardly surprising then that Waitrose should want three-Michelin-starred chef Heston Blumenthal to produce a Christmas Pudding for them. They know that their consumer base are more likely to be trendy and foodie than someone shopping at Tesco who thinks that Chicken Nugget Parmis are "a bit posh innit".

I suppose then, I have absolutely no problem with Coles selling a slightly posh product from a three-Michelin-starred chef because it makes commercial sense for them to want to differentiate themselves from their major competitor.
What I don't understand though is how they can ship a product around the world and sell it for 23% cheaper than they can in the country that made it.
Mr Blumenthal's Hidden Orange Christmas Pudding sells for £14 in the UK which works out to be $23.39; yet Coles can sell it for $18 which is $5.39 less expensive.

My problem isn't therefore with Coles. Clearly they've worked out their price points and have worked out how much they can sell a product for. My problem is with the retailers of Shoes, Clothing, Computer Software, Motor Cars etc who have now had the "Australia Tax" shown up for what it is. This is especially irksome for products like Computer Software where Australians pay a higher rate for the same program even though the actual product is downloaded and is "shipped" more or less instantly.

Mr Blumenthal can hide an orange in a Christmas Pudding; I don't see why retailers should be able to hide an "Australia Tax" in a pricetag.

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