I just got this ad in the “local spam channel”, a SPECIAL OFFER for a 40” LCD TV. It’s “just” JD 2199.
So I checked online: in the US this TV would cost you US$ 1,800 (= JD 1278). That’s a difference of “just under” JD 1000). OK, let’s not compare the prices in the “US and A” with the prices in the HKJ.
Let’s go for an expensive, Euro-zone country: Germany. You can have this TV for Euro 1640 (= JD 1540). That’s a difference of JD 658.
In Jordan people make much less money than in the US or Germany. But they are expected to pay 600-1000 JDs more for home electronics.
I want to naively ask: why?
I really hope to get an answer here from someone who works in our local electronics trade.
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Comments
11 responses to “Why are flat screen TVs so expensive in Jordan?”
Really your Quistion is very new and smart ..
Ill try to answer : If exclude that our traders are blood suker and mony lovers -their is some truth in that ..what ever I can list hese things :
in the countriese you mentioned they produce these screens and we just impot it so you must add the shipping cost and the custom fee wich can be 300% for lexuary item such these screen.
my quistion now: if there is a market for these screens here in jordan with this very high prices (for me this price is half my total anuual income!! ) So this relly would be the real problem in our sociaty …
just in case anybody would tell you: “Well, you know, customs, taxes, bla bla …. ” DONT BELIEVE IT.
just go to any customs point in jordan “Amman, Aqaba, Zarqa, the airport” and you’ll find that the customs never charge more than 20% on the estimated price, and the estimated price is ALWAYS put by the importator much lower than the actual.
the other day My father was there and saw a whole container of luxery furniture with the estimated price: 2 – 10 $ per piece. and 20% customs on it (not all of them, but some of them, since chairs for example have different rates than beds for example… and so on).
so the 2$ chair + 15% which is about 0.3$ is sold in the market with 80 JDs.
hint hint, too many hummers on the jordanian streets!
Im not in the consumer electronics industry, but I study marketing and that question has popped up several times in various courses that I took, and we were told that mostly it’s a case of greed, taking advantage of unaware consumers, and poor protection of the customer by whatever party/parties responsible, unless of course they were made to pay huge tariffs or whatever bringing the merchandise here.
Shit is overpriced in Jordan, that’s why!
and btw it’s $1599 in the US and with free shipping!
I’m afraid that I can’t answer your question, but I’ve been wondering the same thing since I arrived. Nearly every piece of electronic equipment is considerably more expensive than what can be found in the US or Europe.
looks like no one has an answer!! I worked in the raw materials industry (building materials mostly) where we import and distribute locally, and I can tell you that gross profit margins are between 5% and 15% on the great majority of products (the spread corresponds to wholesale on the low side, and retail on the high side of the margin)
Greed my friend, greed!
If the price of flat screen TV’s goes down in Jordan What will happen is: Dollars and Euros will fly from Jordan in a faster pace as the merchants pay for these products in hard currency, this will lead to a budget deficit , more unemployment…etc…etc; and not to mention the IMF has to agree for any substantial move by the Jordanian government decision as far as imposing trade tariff or lifting them.
However Jordan can gain a lot by just floating there own currency which is pegged to the dollar since 1996, Mexico did and their economy is in much better shape than then.
You have to add 30% custom fee + 16% sales tax to the price above + merchants greed that’s why the price is so high.
The global financial suppliers and decision makers will not allow it for the time being and that’s another subject.
Lets play the devil’s advocate here:
From a sellers point of view
1. Base price 500 JOD
2. Shipping,taxes/customs/transportation/government surprises :300 JOD
Now the question is:
Make it 1200 JOD and pocket 400 JOD
or Make it 1900 JOD and pocket 1100 JOD?
I would choose B,why you ask?
Think about it , for A I’ll sell 1,000 units, that is 400,000 profit
Now for B, I’ll sell 100 units, that is 1,100,00 profit, just selling few of them…..
Now you know why? For the Jordanian market, they know they can’t get 1000 Bebol, but you can get 100 Kharoof for sure
Sorry
Sell 400 units at B rate, that is 410,000.
Meaning, to reach the 400,000 target I have to sell for only 400 bebol rather 1000, less effort, headaches, sales persons and market campaing.
Ignore the numbers, and think about the concept
so much about being greedy, I’m so greedy that I think of millions selling only 1000! Lol