Despite the ongoing dissatisfaction of local retailers around the Australian Government’s refusal to apply the Goods and Services Tax (GST) to overseas online purchases under $1000, one Aussie online retailer is urging consumers to buy locally this Christmas.
eStore.com.au chief executive, Lorenzo Coppa, has called on consumers to buy locally this year, despite the high Aussie dollar, and claimed prices of products from online Australian retailers are significantly lower than those available from overseas online stores.
“While it might seem cheaper to buy from an overseas online retailer, the reality is that the price of the product can increase substantially once you add on the shipping cost,” Coppa said in a statement.
“Furthermore, with certain types of goods such as technology products, there can be issues associated from buying overseas such as warranties, compliance with Australian standards and damage to the products while in transit which may not be honoured by overseas online stores.”
Coppa cites a report from PayPal, which indicates the Australian online retail market is set to reach $36.8 billion by 2013, up from a forecasted $26.86 billion for 2010.
The report found almost a quarter of Australian adults only shopped online with domestic websites and that the main driver of overseas shopping was wider choice, rather than price.
According to Coppa, consumer behaviour is shifting and consumers are becoming increasingly technology savvy and comfortable with buying online.
“Over the last few months, we’ve noticed an increase in Australian consumers shopping online,” he said.
“Shopping for commodities is well suited to an online shopping environment," Coppa said. “Consumers today generally know what they want whilst trying to save time and money. Many consumers research their options thoroughly and then hunt online for the best prices around.”
The comments follow calls from Harvey Norman chief executive, Gerry Harvey, that the GST should be applied to products bought from overseas online retailers.
“We have spoken to a number of politicians and their answer is `it's too hard'," Harvey told AAP at the time. “'It is too much to collect. We'll upset the voters because they vote for us'.
"You are going to forgo about $1 billion in one year in tax, that is the GST they are going to lose in one year because this thing has escalated because of the parity."
Australian book retailer, Dymocks, has also announced it is currently considering moving its online business offshore as a result of the combination of the GST issue and parallel importation laws.
“First of all, what we’re trying to do is make a point to the Government that this is ridiculous, why a 130-year-old Australian business needs to move its website offshore just to compete," Don Grover, Dymocks chief executive, told Computerworld Australia at the time.
“The major point of this is making the point to Government that both the parallel importation laws and the GST are currently putting Australian booksellers out of businesses.”
Follow Chloe Herrick on Twitter: @chloe_CW
Follow Computerworld Australia on Twitter: @ComputerworldAu