Stop Core

(This post is not built on fact but supposition)

The cost of a top of the range Macbook (2.4 Ghz) is 1125 pounds or roughly fourteen thousand rand. Somehow in South Africa this exact same laptop costs twenty thousand rand from essentially every Apple outlet in the country. Where does this margin come from? I’ve heard some rumour that Core imports from the UK rather than the US for shipping purposes

Assuming that Core would buy their goods from the UK at the price of fourteen thousand rand (it’s extremely, if not impossibly unlikely that they would buy at retail prices) they still need to factor in the costs of shipping, taxes and eventually sales in South Africa. I’m no import/export expert but here’s what I can tell you:

When it comes to taxes there is no cost on computers except for the 14% VAT. Now since we’re assuming a R14K price that’s a substantial R1960 in vat. This pushes the price up to close on R16K but there are two issues to consider here. The first is that Core most likely pays wholesale prices for their laptops thus making the VAT amount lower anyway. The second issue is that they will claim VAT back so it seems odd for them to charge extra for that. This is possibly showing a vast ignorance of the SA Tax system but this is, as I said, supposition.

Now the shipping is a difficult issue to consider due to Core bringing in bulk orders and also there is little info about the costs of shipping. What I did find is that you can pay up to 180 UK pounds for a 30 KG piece of cargo; equating to 6 pounds per kilo for shipping. Again, this is a rough calculation but the actual laptop weights two kilograms so even if in total the box is five kilograms then you’re looking at a cost of 30 UK pounds to ship or a massive cost of R360. Now this price is excluding bulk shipping discounts so would be most likely different but this still takes us to a grand total of R16360.

Now considering there’s no way Core pays the prices I’ve mentioned as they buy wholesale it seems excessive in my opinion.

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Regardless of whether you buy from an iStore, Incredible Connection or even a reseller such as Digicape you’re still stuck with paying Core for your Apple hardware. As the single licensed importer you’re left with no choice but to pander to their demands.

However you CAN make a difference to their bottom line:

If you can afford to buy Apple products at the prices Core charges then rather buy from a non Core store such as Digicape or Incredible Connection. Now Incredible Connection is normally one of the horsemen of the tech financial apocalypse in South Africa and charge the same price but at the end of the day the margin they make is not going into Core’s pockets. I recommend stores such as Digicape because they seem customer focussed and if they make more money they will hopefully pass on savings to the humble South African Apple lover. The moral of the story is to avoid Core as much as possible. What you must never do is go buy from a Core owned iStore. I’d also recommend avoiding the Cool Apple Buddy store in Sandton as it is not owned by Core, and brings in their own hardware at higher prices than even Core.

Yes, the decor might be sleek white surfaces with wooden floors but in my opinion you’re paying for (a very poor) retail experience. Even if the margin Core looses is ten percent it will still go a long way to hindering their ability to pay the rent of their slick stores in expensive shopping centers.

So let me summarise, you want to avoid all Apple shops that fall under the iStore brand and you want to avoid buying online from their online portal: zastore.co.za

While I don’t expect this to ruin Core (since they still make a fortune from their re-sellers) it would go a way to make them think twice.

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Today I had the pleasure of going to the Apple store in Melrose Arch although pleasure is far from apt. I walked into the store and no one helped me so I went to go help myself. Now I walked from the entrance, past the expensive Macbook’s, iMac’s and Macbook Pro’s to the back of the store. Now in this time there were about three sales people standing around looking bored and I walked past each and every one of them. Not a single one of them helped me and not a single one came to help me when I eventually got to the cabinet with earphones.

Now I wanted some earphone’s for my iPhone which means they needed to have a remote and a mic built in to be truly useful. I found a pair that supposedly had a mic and remote but wasn’t sure if they were compatible. When I finally approached a salesperson he wasn’t able to tell me whether the earphones would work and didn’t even know the price. Now I don’t expect them to know the price on everything but these were generic, Apple branded earphones so how hard would it be to know the price?

Behind me another customer was being helped with an adapter for his video output on his laptop and the salesperson had no idea which one to sell him. Now considering there are only two types of adapters how hard is it to impart this knowledge?

Not only are Apple salespeople incompetent (operated badly and trained by Core) but something makes them totally indifferent as well.

Shocking.

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This post is originally from http://www.mpieters.com/

In South Africa we are pretty used to monopolies who do not actually care about the consumers. Over the years we have dealt with Telkom and Eskom amongst others, and only recently we have started to see the results of competition in our communication industry. Now if other groups can just also follow suit.

Apple products in South Africa are imported by only one company, the Core Group. Core has a its own retail stores (iStores) and they also resell to other retailers like Incredible Connection and Digicape. The service at the iStore in the Waterfront has always been horrendous – for example, walk in a week after a new iPod has been released, and their staff still would know NOTHING about it. Like about a year ago I had this little conversation:

“What do you mean new iPod? With Touch? I think you mean iPhone…” Pathetic.

Today I just checked out what is the price difference of Apple products in South Africa. Here is some examples:

Computers:

Baseline unibody Macbook in SA: R15999

Baseline unibody Macbook in US: R11041 ($1299)

Price difference: 30%

Baseline New iMac 20 inch in SA: R14999

Baseline New iMac 20 inch in US: R10191 ($1199)

Price difference: 33%

8 Core Mac Pro in SA: R40000

8 Core Mac Pro in US: R28050

Price difference:30% (or more than R10000 on a single computer)

iPods:

iPod Nano 16GB in SA: R2699

iPod Nano 16GB in US: R1699 ($199)

Price difference: 38%

iPod Touch 32GB in SA: R5800

iPod Touch 32GB in US: R3400 ($399)

Price difference: 42% !!!!!

Peripherals:

Mini Displayport to DVI adapter in SA: R510

Mini Displayport to DVI adapter in US: R246 ($29)

Price difference: 52%!!!!

Now I know VAT is 14%, which I accept. But as long as there is a sole importer of Apple in SA, we will never ever get decent prices of Apple gear in SA. How can an iPod cost almost double in SA? Shocking!

In the US, Apple is trying to defend its high prices in the current economy, while in SA we pay even more than the rest of the world (Prices for a 8GB Nano accross the world, obviously changes with exchange rate fluctuation:).

1. Brazil $369.61

2. Bulgaria $318.60

3. Argentina $317.45

4. Israel $300.80

5. Peru $294.08

6. Chile $294.06

7. Malta $293.83

8. Egypt $269.10

9. Romania $266.60

10. Uruguay $260.00

11. Turkey $256.12

12. Hungary $254.50

13. Azerbaijan $252.11

14. Serbia $249.14

15. Croatia $245.41

16. Czech $242.54

17. Slovakia $234.13

18. Estonia $226.67

19. South Africa $226.60

20. Finland $225.82

21. France $225.82

22. Russia $220.32

23. Norway $220.20

24. Sweden $215.35

25. Belgium $211.62

26. Austria $211.62

27. Italy $211.62

28. Portugal $211.62

29. Ireland $211.62

30. Germany $211.62

31. Netherlands $211.62

32. Denmark $209.26

33. UK $201.92

34. Mexico $201.87

35. Cyprus $201.85

36. Luxembourg $201.12

37. Poland $200.52

38. Philippines $198.39

39. Spain $197.42

40. Greece $196.51

41. Switzerland $195.43

42. India $183.47

43. Malaysia $181.82

44. Korea $180.60

45. New Zealand $180.58

46. China $179.63

47. Pakistan $179.48

48. Australia $175.42

49. Thailand $174.89

50. Canada $169.68

51. Singapore $167.31

52. Taiwan $165.82

53. Japan $154.21

54. U.S. $149.00

55. Hong Kong $148.12

Source: CommSec, Apple

Over at 2Oceansvibe, Seth has managed to start a small frenzy about the ridiculous service of Core South Africa. Give it a read.

If someone over at Apple is reading this, we in SA are tired of the poor service and high prices that Core forces on us. Please give another group import rights as well, the sales of your products suffer because of their incompetence.

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I stumbled upon this article the other day about how Core (the distributors of Apple products in South Africa) were unhappy that one of their bigger distributors CAB (Cool Apple Buddy aka the Apple store in Sandton City) was no longer selling Core products and rather brought in the stock themselves. CAB basically felt they were losing business due to the poor delivery time of stock by Core.

I must wholeheartedly agree with CAB, Core is one of the worst companies I’ve ever had to deal with and this is assuming you can ever get hold of them. When I was told to phone them about getting my HSDPA modem working they basically had no recourse for me and told me to bring in the laptop. Sure, I understand it’s hard to diagnose over the phone but that’s just indifference on their part. They could have at least given me some generic steps to try fix it. Core knows they are the only distributors and frankly don’t really care about customer service. Why should they, you have to buy from them either way.

Whining about the Core situation aside, I think it’s rubbish that they should have to be the only company bringing in Apple products and if CAB wants to get the products from a different source then good for them. The problem is however that whether you walk into a CAB store or a Core store you’ll pay the same price for your Mac products. One would hope that CAB could lower their prices somewhat considering if they are importing the products themselves there should be some cost savings.

It seems that despite the distributor South African consumers are going to get shafted with regards to price. So ultimately let Core and CAB fight it out, once one company wins we’ll just get to pay more than we currently do to get our Apple fix.

Such is the life of a South African Mac lover.

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