Sony set to rape and pillage UK retailers
By Paul Smith
From the files of That Makes Less Sense Than A Thatched Hen and I Must Be Thicker Than A Hind Of Sow Because I Don’t Understand, we bring you the news that due to the global economic crisis, Sony are to increase the price of their products.
By a up to a third.
Whether or not we’ll be affected by the decision is unknown, as it’s the retailers that’ll be forced to fork out the extra cash. Sony are gambling that shops are so desperate for business, they’ll still take Sony stock at the vastly increased price but sell it at similar prices to those available now, absorbing the decrease in profits by cutting costs elsewhere.
The Japanese company announced the decision just days after the pound fell to its lowest level against the euro, meaning the company will make far less from UK sales. A spokesman said:
“Sony UK can confirm that in the past 48 hours it has communicated to its trade channel that due to adverse changes in the Yen/Euro & Euro/Pound exchange rate over the last six months, and with this uncertainty set to continue into 2009, Sony will increase the trade price of a number of products over the coming months.
“The precise level of price increases has not yet been agreed, but it is likely that the vast majority of products affected will see increases of significantly less than 33 per cent.”
So it’s all about the Japanese company protecting its returns rather than charging customers more. But is that scenario really going to play out? Retailers are already exposed to the double whammy of an increase in operating costs and a downturn in sales - not unlike arriving home to find all your worldly goods set on fire, and then receiving an unexpectedly high gas bill. Will the price of Sony products remain the same or will prices increase to match? Or will stores decide to drop Sony altogether?
[Telegraph.co.uk] via [Gizmodo]
feral trolley of the week
Great business model SONY, OK, i’ll drop the number of SONY units I purchse by a 1/3 to errrr, none. I say drop the CNUTS, and where’s all the fucking swearing got to? (Can I use ‘and’ after a comma?)
Just as well I bought that sony hifi last week for a present. !
Personally, I fail to understand all the hype around Sony gear anyway. I can honestly say that every single piece of Sony kit I ever had the misfortune to own was cr*p. Hopefully, they’ll increase prices to a level where retailers just don’t bother any more. Three cheers to Sony putting themselves out of business (you can always hope, I guess)!
This seems a very strange decision by sony, once again us retailers take all the pain
Thats just the boost the PS3 needs in the UK. I’ve owned some Sony equipment & although they are ususally stylish I don’t think the quality is anything to shout about & certainly not enough to pay an even larger price premium. Reminds me a bit of Volkswagen…living on a reputation of quality when other manufactures have caught up/surpassed them & sell for cheaper. I hope Blu-ray crashes & burns soon.
When multinationals do business in other countries with fluctuating exchange rates, it makes pricing a nightmare.
If you produce the goods domestically for a fixed cost, sell the goods to another country at a fixed price (based on an exchange rate negotiated when things were peachy) and suddenly the exchange rate drops, the value of the currency you received falls, suddenly your not making as much money as before and in the extreme, loss making.
So unless there is a change in price there’s no point for the company to sell it at all. Which is why prices have to go up.
Considering how much Sony subsidize their consoles, it would seem they have no choice but to pass on the costs.
John, do you think that this’ll be passed on to the consumer?
[...] end of £3,489. It’s also worth remembering that back in December, Sony were considering raising the wholesale price of the UK products by a full third. [...]
[...] when we reported that Sony had decided that the best way to buck the economic downturn was to increase their prices? Looks like they’ve started – and they ain’t taking any [...]