South Africans are paying a hefty price for the privilege of buying goods, that are not readily available locally, through SA-based online sites when imported items would be far cheaper.
However, the importers of the items argue that the price consumers see on international sites is not the price they will pay and there are hidden costs, such as shipping and import duties that add to the end price.
Consumer items offered for sale on international Web sites can be bought through local portals - but at a cost of as much as 10 times the foreign currency screen price.
Overpriced?
WantItAll, for example, sells a pack of nine Charmin ultra-soft bathroom tissues for R462, while Pick n Pay's most expensive toilet rolls, for nine, cost R48.49.
The online retailer offers a Kindle Fire full-colour, seven-inch multi-touch for R2 499, which could be bought from Amazon.com for $199 - or R1 657.45 - although Amazon will not ship the item to SA.
A Kindle six-inch e-reader, which is WiFi-enabled and uses e-ink, can be bought from Amazon.com for R907.85, although shipping will cost extra. WantItAll, which offers free shipping on three or more items, sells the same item for R1 485.
Have2Have sells the six-inch Kindle for R1 238.96, while the same item can be bought from Incredible Connection for R1 499.95.
Buying a pram for two also seems to be far cheaper from a US-based online portal. WantItAll offers a Contours options LT Tandem Stroller for R26 522, which can be bought on Amazon.com for the equivalent of R2 073.90, although the US retailer will not deliver in SA.
Groupon SA is offering a retro cassette-styled iPhone cover for R299, a 40% saving according to the site. However, the UK version of eBay has the same item for £1.95 - a fraction of the local price.
Justified
Justin Drennan, CEO of local online store WantItAll, says consumers cannot simply convert the international price to rands, as there are other costs that must be taken into account.
In addition to the purchase cost, WantItAll pays duties of up to 35%, based on 110% of the value of the goods. It also forks out for credit card processing fees, insurance against fraud, and the cost of unpacking and inspecting the items.
Drennan says the company's offering is to import products that are not usually available in SA, and it uses an “extremely” efficient and expensive air freight service to do so quickly. “With speed and reliability comes cost.”
WantItAll is a specialist service, aimed at a particular market, and items imported from abroad will inherently be expensive, says Drennan. “Many of our customers make use of Amazon and other stores abroad. The challenge they have is once they have a bad experience when handling the importation of goods for themselves, they understand the value we offer.”
Tallying the cost
Have2Have co-owner Simon Swanich adds that the Amazon price for the six-inch Kindle is the cost an American will pay, and getting it to SA using a well-known courier service will push the price up to R1 600.
In addition to import duties, consumers will also have to pay a customs agent to clear items, who can charge R120 to process it and requires a R159 disbursement fee, says Swanich. “At this point, the $109 Kindle now costs R2 979. From a cost perspective, it no longer makes sense to import the Kindle.”
Have2Have imports “difficult to find and speciality items”, as well as items that consumers cannot import themselves, says Swanich. “As we import a multitude of items for customers on a regular basis, we benefit from significant reductions in shipping costs which we are able to pass down to the customer.”
Stefan Marnewick, acting CEO of Incredible Connection, adds that, while the price difference looks significant at face value, “one needs to make the respective offerings comparable”. He explains the group has a very narrow margin because it imports through the official channels.
Marnewick adds that online stores do not have the same costs as brick and mortar outlets, and also do not offer the same level of service.
Groupon did not respond to a request for comment.
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