Imported furniture profiteering behind the complicated cost benefits to help push the price

November 29, 2019

The four expenses of taxes, transportation, rent and labor account for 60% of the price of imported furniture. "A 'foreign' sofa with an ex-factory price of 10,000 yuan is sold for 40,000 yuan in China. Is there any price moisture in the middle?"
According to Mr. Guo, when he recently searched for a consumer target in an imported home store, he fancy a imported leather sofa of 40,000 yuan. The shopping guide told him bluntly when recommending the product, although the ex-factory price of this sofa is 10,000 yuan. However, the intermediate links of taxation, transportation, rent, labor and so on have caused the cost to increase by two or three times. Even if they sell for 40,000 yuan, they do not make much money. Is it that the “profiteering” products in the eyes of consumers have become “difficult households”? In the face of this "cost-transparent" shopping guide, Mr. Guo was a little panicked.
In this regard, some insiders said that imported furniture with high price moisture is not without. However, the current rent, transportation, and labor costs have skyrocketed. The price of most products is 2 or 3 times higher than the ex-factory price. It is well-founded. Consumers may wish to calculate their own accounts.
From "factory" to entering "sales" in China, at least four major cost-related "imported furniture with a price of 1 million yuan, it is likely that there is no domestic furniture that sells for tens of thousands of yuan to earn money." Faced with imported furniture "profiteering" The argument that Mr. Chen, who has represented a European furniture brand for many years, hopes to use an example to bring out the answer. Mr. Wang bluntly said that the cost of adding imported furniture is very high.
Take a set of furniture with a price of 1 million yuan, and remove the cost of getting goods by about 15%. The tax, transportation, rent and labor costs account for about 60%. And it should have been 25% of the profit, and it will be consumed a little bit in the process of “waiting for sales”. If this piece of furniture is sold for half a year, it will hardly make any money.
Indeed, for the current manufacturers of imported furniture, the four levels of “tax, transportation, rent and labor costs” have almost become “magic curses”, which is the decisive factor affecting the final price of furniture. In this regard, Wang Lanyu, general manager of Super Comfort International Home, also took the situation of his own brand as an example to help consumers calculate their accounts.
He said that at least 20% of the value-added tax must be paid for each purchase (17% of the furniture value-added tax and about 3% of the freight VAT); domestic rents have grown rapidly in recent years, accounting for 30% of the selling price; The freight and labor costs at home and abroad probably account for about 15%. Therefore, imported furniture now wants to enter China for sale, and the cost is basically low.
Some unstable factors can also cause imported furniture to “price rise”
German Weiler's upholstered furniture has been fine-tuned at the end of last year. The price of Swedish DUX mattresses has been raised by 10%-20% at the beginning of this year. In the middle of the year, the price will be adjusted by 5%-10% due to product series upgrade. ... Attentive consumers can easily find that most imported furniture will be priced 1-2 times a year, and such "price adjustment" is caused by some unstable factors.
For example, the loss during long-distance transportation and the price adjustment of foreign manufacturers. In this regard, super-comfort general manager Wang Lanyu said that due to various reasons, the problem of furniture loss is normal, most manufacturers will use this as a reason to increase the price by a few percent to buy an "insurance" to avoid fuss in the future.
And the "additional cost" generated by the manufacturer's annual price adjustment, will the merchants also include the final price, so that consumers can pay?
In this regard, the industry said: not necessarily, this is usually done by the agent himself. DUX mattress domestic agent Zhou Wei said that they will not include the increase in the price in advance, only the manufacturers will increase the price they will adjust the price; Germany Marburg wallpaper (wallpaper decoration renderings) China region president Lu Huanzhen also said that their agents Germany's Marburg, AGENA, JAKOBSCHLAEPFER and many other high-end wallpaper and fabric brands will also carry out price adjustments from time to time. Usually, they will determine whether the domestic price increases according to the price adjustment of the manufacturers. If the manufacturers increase is not large, the domestic prices are basically unchanged. Marburg wallpaper has not increased in price in the past 2 years.
In addition, Super Comfort Wang Lanyu also said that the annual price adjustments and ranges of foreign factories are related to their brand awareness, raw material prices and product update speeds, which are price adjustments within the normal range. However, whether the price of the agent is adjusted according to the above fluctuations, sometimes depends on the "actual situation" and "mood" of the manufacturer.
Usually, some of the more "innocent" domestic agents in order to avoid the annual price increase with the factory price increase, the inconvenience will increase the product price by about 10%, to the best of the way; but experienced agents are rare Incorporate this part of the cost into the product terminal price. Because one of their most important tasks every year is to play a game of “price increase or not” with foreign factories. If the game is successful, there will be no price increase of around 8% in the current year. If you calculate the current product sold in China for 40,000 yuan, consumers will be able to pay less than 3,200 yuan.
High-end imported furniture "benefits" or more than 30% of the price you know, a piece of furniture with a price of 100,000 yuan, may have 30,000 yuan are returned to the designer. A designer who asked not to be named (villa decoration renderings) told the author that if they helped some high-end imported furniture brands to successfully match, they would get more than 30% of the "hard work". In this regard, most people in the industry said that the "commission" for designers is equivalent to the "promotion fee", which is common internationally. Because some hundreds of thousands, even millions of pieces of furniture, can't be sold just in the store. And after a good designer targeted "high-end consumers", the success rate of sales doubled.
So, is this “hidden cost” also to be paid by consumers? Zhou Wei, a domestic agent of DUX mattresses in Sweden, said that it is not necessarily the case. They usually don't return the designer cash directly, nor do they let the consumer pay for this part of the cost. Instead, when the designer buys the product, he will make a “promotion” in a disguised way. Of course, only designers who have been approved by them have this “treatment” and each designer has only two chances to purchase a 40% discount.

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