Hi Johny, what you say is right, it is up to the buyer to understand the retail market. In turn it is up to the manufacturer to understand their market, which is the Australian importer.
Hi, I am sorry to the original poster for derailing their thread, but Steve I am sorry to say what you are saying is just incorrect.
Firstly, the manufacturer's market isn't the Australian importer at all. The manufacturer's market is the market that offers him the biggest return.
Whether you accept it or not there are two issues that affect the Australian market.
Firstly, sorry but the size of the Aussie market dicates that it is well down the list of importance in the eyes of manufacturers. I don't mean that in a derogatory way, its just the way business works. There are manufacturers who specifically make for the US market, specifically make for the European market, but I don't know any that specifically make for the Aussie market.
Secondly, traditionally Australia is a market where wholesalers dictate the show. Independent buyers buy in such small quantities that it has never been possible to buy direct from a factory. It was only the big players who could do that. And that is part of the reason why some goods in Australia are so expensive, because there is that extra set of hands from the wholesaler.
It is only relatively recently, maybe with the advent of places like eBay, that a lot of buyers in Australia are now looking to buy their products more directly. But the end result is the same, a factory isn't going to make just 5 cameras for these buyers. They will only get them from a source with existing stock or as part of some larger order if the timing is correct.
I disagree with the first paragraph, by selling more the manufacturer decreases the unit cost. The priniple you discuss is on a custom made to order basis. In the majority of cases same product being sold in the USA and European markets is also sold in Australia and NZ.
Just about every factory (with the exception of factories that make some items such as garments) works on a custom order basis. They don't hold stock because holding stock is having their money tied up.
And this is why a factory works with an MOQ. This is the amount they calculate their cost structure on, when determining the cost of doing business.
Have a look here about MOQ:- http://www.asiasupplierreview.com/fo...php?f=11&t=240
This is what I have written to try and explain why factories have an MOQ and why it costs more for buying smaller quantities.
Essentially, cost savings come from economies of scale. It is cheaper in terms of real cost and time efficiency to make one order for 10,000 pieces than it is to make 10 orders of 1,000 products.
So no, they do not hold large amounts of stock so that someone from the US orders some pieces they will send them, some one from Australia buys a few so they send them too. Where that happens you are dealing with wholesalers, not manufacturers.
And finally, in many cases it is not the same product being sold in the different markets.
Take a toaster as an example. In the US it is required to meet FDA standards, Europw, CE, RoHS, Weee, in Australia AS/NZ.
So one factory may have paid what can be tens of thousands of dollars to secure CE certification for Europe, but they have never had their product tested for the Australian market. Quite often this will be because they have decided it is not worth their while because they may consider the amount of sales from Australia is not enough to have the testing done.
Plus different products may have some different components. For example, a power plug for the US is different from the BS plug used in the UK which is also different form the SAA plug used in Australia.