Web shopping puts an end to Dominican retailers? decades-long price gouging

windeguy

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Jul 10, 2004
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Santo Domingo.- Dominican Republic?s Couriers Association (Asodec) on Thursday slammed those who oppose online purchases on claims of lost tax revenue, and also revealed what local buyers have long suspected; that the country?s retailers have price-gouged them for decades.

The entity criticized the retailers who claim that items bought on the web for under US$200 pay no tax, warning that any levy placed on internet shopping will ?severely? jeopardize Dominican consumers even more.

Asodec president Jos? Burdi? said a tax on Web shopping would also breach Dominican Republic?s free trade pact with the U.S. and Central America, which provides for only a customs fee on purchases of less than 200 dollars. He said web purchases currently pay a 25-cent-per-kilo fee.

He said a tax will hurt consumers who currently save as much as 300% when they buy a product online. ?This could lead to a constraint to the facilities now available to consumers to buy their products freely.?

The business leader also warned that any hurdle on online purchases could also jeopardize the country?s 65 million pounds of fresh vegetable exports, since most of the shipments are placed on fights which bring items before returning.

Burdi? debunked the National Commercial Companies Association?s complaint that several of its affiliates have gone under from the jump in Web shopping, and said the failures were from mistaken investments and to Dominican merchants? ?failure to adapt to the market?s reality.?

The Courier Association added that estimates that around 65,000 Dominicans buy online each month and about 500 thousand a year.

Source: DT
 

Castle

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I think it's not only how much you save, it's what you can find and its quality. The other day I was looking for two things for a cell phone: a battery and a USB/charger cord. The battery I found , at 900 DOP (US$ 21), and the cord was nowhere to be found (Sirena, Plaza Lama, Carrefour). In Amazon I found the battery at $5 (210 DOP) and US$3 for 10-foot cord. Both things for half the price of the battery locally. And the battery they were selling me here didn't really look too reliable. If I had paid tax for all that, the battery would have ended up being maybe US$6 or 250 DOP. How can they charge 900 DOP?
 

caribmike

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Jul 9, 2009
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"How can they charge 900 DOP?"

That is exactly what it is about. People did not know better, they could rip them off as they saw fit. Now people start learning and and that is what is itching them...
 

windeguy

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I have noticed for years now that it is almost always less expensive and the quality is better if I import an item rather than purchase it here. That goes from compact fluorescent light bulbs up to 6.5 KW generators.

Sure most of the stuff purchased from anywhere is made in China, but there are different levels of quality in those products. The US resellers import the "A and B grade" products while the DR imports the "C or D grade" products and sell them at A+ prices. That is price gouging.
 

the gorgon

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Sep 16, 2010
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I have noticed for years now that it is almost always less expensive and the quality is better if I import an item rather than purchase it here. That goes from compact fluorescent light bulbs up to 6.5 KW generators.

Sure most of the stuff purchased from anywhere is made in China, but there are different levels of quality in those products. The US resellers import the "A and B grade" products while the DR imports the "C or D grade" products and sell them at A+ prices. That is price gouging.

glad you cleared that one up, windy. there are good Chinese products, but the stuff imported into the DR is the real low quality crap, and they charge an arm and a leg for it.

when internet shopping really takes off big, some guys are going to be having fire sales on their Bimmers. i can just see some enterprising guys acting as middlemen, buying stuff for those who do not have computers, and making a decent profit, but keeping the prices reasonable. my buddy has a business mail address, and i am using it to bring in a pair of headphones that i just bought. it is going to cost me a few dollars to ship it, and it cost me 35 bucks to buy. it would easily sell for 3 large here, if i could find it.
 
Feb 7, 2007
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Here we are again with the same thing. It now looks to me like Dominican tradition that the retailers' association brings this up every year.
 

windeguy

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Here we are again with the same thing. It now looks to me like Dominican tradition that the retailers' association brings this up every year.

Just in time for those planning on Christmas shopping? :)

Correct. They actually started to tax items priced under $200 US and it backfired. They found out it violated already signed trade agreements.

NOTE: If you try and import a TV that costs $199 US or less, DR Customs will still try to charge you a duty. I am not sure how they work around the $200 rule, but they still assign "their own value" , (i.e. something they pull out of their, um, hat) to such TVs and charge duty.
 

dv8

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one of the comments:
APROVECEMOS LA OPORTUNIDAD: VENDAMOS TAMBIEN NOSOTROS
RD est? extraviado. Lo que necesitamos los dominicanos es aprovechar ese mismo medio y COMENZAR A VENDER EN INTERNET,- NO SOLO COMPRAR....hay incontables productos artesanales dominicanos que se pueden vender desde RD hacia USA en sites como Amazon o eBay, pero la gente no lo sabe. Adem?s los couriers cobran una exageraci?n por llevar un producto RD-USA, aunque en v?a contraria es muy barato, me dicen que por INPOSDOM los env?os a USA son super econ?micos.


makes me wonder, why is it that no one looked at this as a business opportunity? are there taxes on items under 200 dollars coming out of DR and to the USA?
 

the gorgon

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Sep 16, 2010
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one of the comments:
APROVECEMOS LA OPORTUNIDAD: VENDAMOS TAMBIEN NOSOTROS
RD est? extraviado. Lo que necesitamos los dominicanos es aprovechar ese mismo medio y COMENZAR A VENDER EN INTERNET,- NO SOLO COMPRAR....hay incontables productos artesanales dominicanos que se pueden vender desde RD hacia USA en sites como Amazon o eBay, pero la gente no lo sabe. Adem?s los couriers cobran una exageraci?n por llevar un producto RD-USA, aunque en v?a contraria es muy barato, me dicen que por INPOSDOM los env?os a USA son super econ?micos.


makes me wonder, why is it that no one looked at this as a business opportunity? are there taxes on items under 200 dollars coming out of DR and to the USA?

i guess that the tax arrangements are reciprocal, since it is a trade agreement. i cant see one set of rules for one country, and a different set for the other.
 

dv8

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He said a tax will hurt consumers who currently save as much as 300% when they buy a product online. “This could lead to a constraint to the facilities now available to consumers to buy their products freely.”
I don't have a degree in math or anything else for that matter, but I defy anyone to tell me how anysale could have a savings of more than 100%.

it means save as much as 300% in comparison to the price charged for the same item in DR.
 
Feb 7, 2007
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He said a tax will hurt consumers who currently save as much as 300% when they buy a product online. “This could lead to a constraint to the facilities now available to consumers to buy their products freely.”
I don't have a degree in math or anything else for that matter, but I defy anyone to tell me how anysale could have a savings of more than 100%.

The mathematics of some baffle me. How can you save 200% or 300%?. How can you reduce price by 200% or 300%. This is just insane. If an article in place A costs 30 pesos, and in place B it costs 100 pesos, you have not saved 300%. You have saved 70%. Same way with reduction. If an article costs 100 pesos, how can you reduce price by 300%. That means the buyer would get product for free and the seller would need to pay the buyer! You can have a 200% or 300% increase, though, but you cannot reduce or save 200% or 300%.
 
Feb 7, 2007
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it means save as much as 300% in comparison to the price charged for the same item in DR.

DV8, you're Polish. You have old Eastern European education where Mathematics was taught well.

If an article on amazon costs 100 pesos and in the DR costs 300 pesos, you have not saved 200% or 300%. You have saved:
1-(100/300)*100%= 67%

Or to put it simple;
If it costs on amazon 50 pesos, and in Sirena 100 pesos, how much have you saved? It isn't 100% or 200% or anything by that token. It's 50%. You have saved 50 pesos out of the 100 pesos it would have cost you in Sirena, so you saved just exactly 50%. Had you saved 100% or more, the article would have been free to you. Now if Amazon gives you a token of appreciation and sends you the article for free, yes now you have saved 100%. It's free. In either case you cannot save more than 100%. And remember, saving 100% = Free.
 

dv8

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Sep 27, 2006
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The mathematics of some baffle me. How can you save 200% or 300%?. How can you reduce price by 200% or 300%. This is just insane. If an article in place A costs 30 pesos, and in place B it costs 100 pesos, you have not saved 300%. You have saved 70%. Same way with reduction. If an article costs 100 pesos, how can you reduce price by 300%. That means the buyer would get product for free and the seller would need to pay the buyer! You can have a 200% or 300% increase, though, but you cannot reduce or save 200% or 300%.

again with this. this article compares prices for an item A charged in DR by dominican merchants with the same article A bought over the internet. 200-300% cheaper over the internet than in DR. so what cost me 10 dollars on ebay in a dominican shop costs 20 or 30 dollars.
 

dv8

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DV8, you're Polish. You have old Eastern European education where Mathematics was taught well.
If an article on amazon costs 100 pesos and in the DR costs 300 pesos, you have not saved 200% or 300%. You have saved:
1-(100/300)*100%= 67%

you can see i was in human sciences class. to me if i pay 3 times less i save 300% and let's leave it at that.

edited to add an example from the comments:
Rob
Un ejemplo del porque quieren evitar las compras: Hace un a?o fui a comprar una pieza de mi vehiculo a la casa que trae los repuestos de esa marca, mi sorpresa fue alta cuando me pidieron 56,000 pesos ( 1,316 dolares) por esa pieza, y ademas, como es electrica, no tiene garantia; entonces decidi investigar que costaba esa pieza en eeuu, y para mi sorpresa la pieza costaba 120 dolares (5,106 pesos) y solo tenia que pagar unos 10 dolares para el envio y otra bagatela al courier.


are we getting to 200/300% yet?
 

dv8

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Sep 27, 2006
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wait. i get the math of saving now. starting with 100% being an elevated price being charged by some dominicano. i operated on the basis that 100% was the internet price. indeed, you cannot save in terms of math. you are all correct.



the article should simply say that dominican prices are 2-3 times higher that internet rates.
 
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JMB773

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Nov 4, 2011
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DV8 you are funny LOL

If I had an apple for sell and I gave it to you for free you saved a 100% off the price of the apple. For you to save 300% on anything. Example: I would have to give you the apple free and give you money or store credit.

BTW Your way makes more sense but fractions and percentages are tricky in math.
 

jkc

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Jun 24, 2013
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I have noticed for years now that it is almost always less expensive and the quality is better if I import an item rather than purchase it here. That goes from compact fluorescent light bulbs up to 6.5 KW generators.

Sure most of the stuff purchased from anywhere is made in China, but there are different levels of quality in those products. The US resellers import the "A and B grade" products while the DR imports the "C or D grade" products and sell them at A+ prices. That is price gouging.

yes, that is how it is pretty much done in these third world countries. Selling you low quality stuffs at exorbitant prices. Yes!