“UK prices - a steep climb ahead”

[bfitzgerald]

Oh dear it does not sound too good does it?

Lenses seem to have gone up a bit too

And the doom and gloom continues...

http://www.theregister.co.uk/2009/01/20 ... istration/" onclick="window.open(this.href);return false;

[alphaomega]

There is a simple answer. We stop buying and the suppliers will then have to come to their senses or go out of business.

[alphaomega]

Or the people David Kilpatrick is referring to in his article are trying to get us to panic buy their current excessive stocks because they need cash flow. Who knows?

[peterottaway]

I was doing just a bit of browsing of a couple of retailers sites this afternoon and there has been some price creep since before Christmas. The most obvious increase was a AUD 100 jump in the price of a Tamron 70 - 200/ 2.8.

[jcoffin]

There is a simple answer. We stop buying and the suppliers will then have to come to their senses or go out of business.

That's more likely than not to backfire. Sony is in a position of trying to increase their market share, so I doubt they're doing much (if any) price gouging. Refusing to buy means they'll be producing fewer units and losing whatever economy of scale they current enjoy -- certainly less than Canon or Nikon, but (equally obviously) more than the smaller players. My guess is that their prices are currently governed more by their costs than their profit margins. As far as UK prices go, it comes down to this: all the money being used to bail out banks, etc., doesn't just appear by magic -- a given economy has (roughly) a given value, and as the government pushes out more pounds (or dollars, euros, etc.) each one represents a smaller percentage of that overall value, so the value of each goes down. Despite them pushing out more money to try to stimulate the world's economy, the economy is contracting, so that overall value is becoming smaller at the same time as the number of pieces into which it's being split grows larger. The result is inevitable: each one is worth substantially less, and anybody selling from an economy that's not going through the same problems right now (e.g. Japan) will have little real choice but to raise their prices simply to get as much real value as they were getting previously.

[David Kilpatrick]

Or the people David Kilpatrick is referring to in his article are trying to get us to panic buy their current excessive stocks because they need cash flow. Who knows?

Not in these cases. I was querying some recently announced prices, and talking about future advertising (that's why I talk to the people involved, for obvious reasons). None have any plans to cut advertising and have actually renewed for 2009, though I'm having a heavy argument with an Italian wedding album UK distributor right now over what he thinks we should be charging him. This is a genuine problem - these importers have credit facilities from the Japanese or European parent companies, but those lines of credit can not just be arbitrarily increased. With goods from both Japan and Europe costing over 30% more now than last summer, what it means is that they must cut their stock orders accordingly. That means where they had three lenses (or whatever) to sell in 2008, they have only two to sell in 2009. Now in 2008 they might have been OK on the profit from two lenses, the third one could be discounted/put into review stock/given to a rep/used at an exhibition or whatever.

Tamron just announced that in future, no requests for loan stock will be met except from allocated loan stock, and all of that will only be in Nikon fit. Back when the A100 came out I was able to get the Tamron 28-75mm lens in Pentax, Nikon and Alpha fit so I could compare three cameras with an identical lens. Now, they simply would not do it - no way are they taking three new lenses out of stock, meaning they can only ever be sold as ex-demo. Everything is tightening up, and that includes special deals for retailers. They are all following Nikon's line - if there is a market for one item at full profit, better to sell that than ten items at 10% of the required margin.

On my pro association forum, someone said they had complained to Canon about having to pay £50 extra for a lens hood - why was it £50? 'How much do you charge for a 10 x 8?' was the answer back. Of course, my portrait studio colleagues charge £50 for a 10 x 8. They charge whatever the market will stand, and that's exactly what Canon said - 'people will pay £50, so we can charge £50'.

David

[pakodominguez]

There is a simple answer. We stop buying and the suppliers will then have to come to their senses or go out of business.

That's more likely than not to backfire. Sony is in a position of trying to increase their market share, so I doubt they're doing much (if any) price gouging. Refusing to buy means they'll be producing fewer units and losing whatever economy of scale they current enjoy -- certainly less than Canon or Nikon, but (equally obviously) more than the smaller players.

I think jcoffin is right. If you stop buying the market can only shrink, so prices will go even higher because cost increase.

I don't know how bad the pound is now, but actual price increase isn't a real increase but that Sony seasonal (since the end of November) special ends this week. In other hand, what Sony is doing in the UK is just actualizing prices because the fall of the Pound vs. the Yen -a way to control people from the CE buying for cheap in the UK.

We, in the third world, were so used to those practices, and now Peruvian "Sol" is doing better than the Sterling!!!

[bossel]

I really wonder how they want to implement a price increase? If Nikon increases, I buy Canon or Sony. If all increase at the same time, then it's a cartel or oligopol or whatever you call at and Brussels should intervene, like they were doing with the ridiculous prices of cell phone roaming. Of course it might take 3 years until they say it was illegal...

I wonder if car prices are going up in the UK as well?

[Javelin]

FWIW some of the DPR memeber have gotten mails from B&H anouncing a nikon price increase ..15% (for the US anyway)

[David Kilpatrick]

I really wonder how they want to implement a price increase? If Nikon increases, I buy Canon or Sony. If all increase at the same time, then it's a cartel or oligopol or whatever you call at and Brussels should intervene, like they were doing with the ridiculous prices of cell phone roaming. Of course it might take 3 years until they say it was illegal...

I wonder if car prices are going up in the UK as well?

For certain. You can't have a situation where the pound was worth €1.50 in 2008 and is now €1 in 2009, without seeing the price of European cars rise. It's just as bad against the dollar and the yen and most Far Eastern currencies - the pound has lost 30% of the its value in a little over six months.

Compare that with Harold Wilson's devaluation of the pound, which put the economy in shock - 15%. We have had an actual devaluation of the pound by twice the amount of that 1960s emergency measure. That means all imported goods (and in practice, most home-produced goods) will rise in price. Salaries will not. It amounts to a nationwide wage cut.

David

[Greg Beetham]

I'm sure I heard on the news that the Japanese government were thinking of setting the value of the yen instead of letting it float, they were getting concerned about exports dropping apparently, the news item said Japan's economy depends totally on exports...with most of the major currencies heading south against the yen, everything Japan produces is getting an artificial boost in price due to the exchange rate, without any actual price increases, and that is translating into declining sales, for example Toyota, the worlds biggest car manufacturer actually posted a loss for the first time.....I don't know if that was for 1 month or for a quarter though.
Some of the reason of the decline could probably be due to there being less customers with disposable income (job losses), as well as the increasing prices.
Greg

[artington]

Japan will not manage the yen float. Period. It would be a disaster for them and is, in any case, quite unnecessary. Exports account for around 10%, maybe 12%, of Japan's GDP but are nonetheless the main contributor to growth because domestic demand has been flat to down. Unfortunately Chinese demand is falling off a cliff (don't believe the growth numbers) and this is having a big impact on Japan - indeed total Japanese exports fell by 35% year on year in December in yen terms (exaggerated by yen strength). Now I have no doubt that they will want to offset falling export margins by raising export prices. However, this is known as "shooting yourself in the foot" because sales overseas (exports) will certainly decline, possibly dramatically in the face of such action. And herein lies the rub - consumers have over consumed using cheap loans. These loans are now - if available - considerably less cheap because the banks, who have been reckless, are increasing their lending margins to re-build their ravaged balance sheets and people are having to reduce borrowing. So personal consumer spending on discretionary items such as cameras and lenses might be expected to fall sharply anyway and raising prices is simply going to make it worse. While I am sure that there plenty of well-off retirees who are cash rich and without debts, who may form a sizeable part of the premium market, I don't imagine that they account for a major part of the mass market - so expect a collapse in sales of P&S cameras because the buyers of these are, as a generalisation, up the creek. They have declining discretionary income because of debt re-payment and soon-to-be rising taxes from profligate and rapacious governments (particularly here in the banana republic of Britain). As for up-market Sony / Canon / Nikon etc lenses and DSLRs, they may well try to raise prices but it will probably do neither the manufacturer, nor the poor retailers, any good. And the pros will probably have to stay with what they've got because this depression is going to be pervasive because the indebtedness caused by 20 plus years of living off tick is not going to be sorted in 20 months. No way.

[Dusty]

They have declining discretionary income because of debt re-payment and soon-to-be rising taxes from profligate and rapacious governments (particularly here in the banana republic of Britain).

Up until you said Britian, I was sure you were talking about us Yanks! However, since you've pointed out how bad it is there, and, since the Colonies were once British, I now have a way out of this mess. We're going to sue you guys for making us this way! I'm sure I can find a lawyer who will take that case. After we've sucked every last dime from the Queen's riches, and put a lien on every Brit's property that will last generations, we can live on easy street over here, going back to our irresponsible ways!

...because this depression is going to be pervasive because the indebtedness caused by 20 plus years of living off tick is not going to be sorted in 20 months. No way.

Sadly you are right on target here.

Dusty

[alphaomega]

Dusty wrote:

Up until you said Britian, I was sure you were talking about us Yanks! However, since you've pointed out how bad it is there, and, since the Colonies were once British, I now have a way out of this mess. We're going to sue you guys for making us this way! I'm sure I can find a lawyer who will take that case.

No, you will not find a lawyer who will take up your case. US lawyers are not known for being altruistic and once they look at Britain's finances now and in the future they will conclude there is nothing left to sue for.

[Greg Beetham]

Top post Artington, 10 or 12% of GDP? I never knew just what it was myself, I would have imagined it was more but I'll take your word for it, the world economy is spooling down and it seems too me that all the component parts are suspicious of each other, that someone will be left holding the bag (again) so to speak, and no one want's it to be them, the shareholders are suspicious of the stockmarket, that it'll evaporate their sharevalue so they are reluctant to invest in anything, banks are suspicious of manufacturing, that they'll go broke and leave them in a huge hole so they are charging high interest for finance which will make it difficult to service debt pay taxes and overheads and still make a quid, governments as usual don't trust anyone, but they are printing money anyway and that'll most likely make it even more worthless, and for poor old Joe Blow, it looks like the carrot has disappeared over the horizon.....what is the magic elixer too get things cranking up again?......nothing seems to be working very well so far..not even cheap oil seems to be able to get things moving in the right direction...
Greg