Wednesday, September 7, 2011

The High Price of the Michell Tecnoarm in Australia

I use a Michell Tecnoarm on my modded Rega P3 turntable. It's a beautiful arm, performs wonderfully and looks great. I purchased mine from Trichord Research in the UK about five years ago. At the time the retail cost was $1,299 in Australia and the total cost to buy from the UK was around $700. Thats a huge difference in price and only a small amount of it can be justified by additional shipping costs. Somebody, somewhere must be making a huge profit.

Now I would have expected, with the exchange rate for the Australian dollar being so good and the ongoing squealing from Australian retailers that online stores overseas are killing them, that we may have seen the price of the Tecnoarm become more competitive. But no, it's recommended retail price is still $1,299. A quick Google search shows that this is pretty much a universal price across Australian retailers. Now to be fair if we take GST out of the equation that price drops to $1180. Also to be fair the price in the UK, has now risen to £457.50 ex vat, or $693.15. To be even fairer lets say it costs $50 postage for the Tecnoarm to be delivered from the UK to Australia. So the total cost to buy from the UK today is $743.15. That is still a price difference of $436.85.

Why? There is no import duty on tonearms, so the reason has either got to be that retail selling in Australia costs much more than it does in the UK, or profit margins on much Audio gear sold in Australia are excessive. I have doubts too that excessive profit margins are all going into the pockets of the retailers. The Australian distributor of Michell Tecnoarms is Amber Technologies. Amber Tech is a large company listed on the Australian Stock Exchange. It distributes home and professional audio visual equipment. In the case of the Michelle Tecnoarm it has sole distribution rights, which means that Australian retailers can only buy from them and are unable to seek alternative and cheaper distribution from overseas. It also means that Amber Tech can set the retail price and then sell at a discount from the retail price to the retailers. This allows the retails to make a profit, but there is nowhere in this equation that allows for competitive price setting. Hence the price in Australia is $1,299 and that's it.

Little wonder that many people will be buying directly from the UK.

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