Does rip-off Britain still exist? The Bitterwallet price comparison test
"Never keep up with the Joneses. Drag 'em down to your level. It's cheaper." - RipOffBritain
Coined originally in 1997, the phrase "Rip-Off Britain" has been used to reflect the vast difference in the UK's car prices, when compared with the rest of Europe. But since that time, the phrase has been integrated into part of our everyday language, especially when we've been diddled out of our hard earned cash by crappy goods, poor service or shoddy business practices with exorbitant charges that leave most of us feeling pretty frustrated and angry.
So does 'Rip Off Britain' still exist, compared to the rest of the world?
We decided to look at the actual figures and price difference by comparing 5 popular consumer products, well known and mostly identical all over the world, ranging from Apple Macbooks to the Sony Playstation 3.
We compared the high street price index in the UK, US and France (as a major port of EU purchases), using search engines Pricegrabber, Kelkoo, and Froogle to look for any major deals, but when possible, doing a direct comparison through a universal eCommerce merchant such as Amazon US/UK/Fr to minimize external factors. The currency exchange rates are based on XE.Com.
Here are the results:
|iPod Touch (16GB)||£205||$284.95 (£203)||€254,95 (£229.68)||USA|
|Playstation 3 (80 GB)||£293||$399 (£285)||€399.50 (£359.9)||USA|
|Wii||£176||$249.99 (£178)||€239.68 (£215.92)||UK|
|XBox 360 Arcade||£124.99||$199.99 (£142.85)||€179 (£161.26)||UK|
|15" Macbook Pro (250GB)||£1,452.61||$1,868.98 (£1,334.98)||€1,887 (£1,700)||USA|
(If you're interested in comparing the iPhone 3G, Andy Peatling does a pretty good job on his blog).
Here some observations on these products and price differences.
- The Macbook Pro is around £118 cheaper in the USA, but that translates to only about 8% cheaper than the UK
- The Xbox 360 Arcade is about £18 (14%) cheaper in the UK than the US.
- None of the products are cheaper in France
The few limited products we look at are by no means an overview of all significant areas in our economy, as they only reflect a slice through the window of perspective that looks at our consumer society and economy. But the results would certainly make John Browett, CEO of DSG International (Dixons, Currys and PC World) proud - his company once denied that consumers were being ripped off in the UK. Good work fella.
Here are some theories as to why this could be the case:
1. Currency exchange: We are taking a bit of a pounding right now with the currency exchange. As of today, XE.Com rates for UK -> US is at 1.4, while UK -> Euro is at a measely 1.11. Compared with the UK -> US rate of 1:2 a year ago and the previously stable Euro exchange of > 1.3-1.4, this difference would add to the discrepancy in higher priced items like the Macbook Pro and PS3.
2. Localization: The UK is one of the few major English speaking countries in Europe. Thus a direct comparison with a country where English is not the primary language could be a factor due to localization.
3. Market size: The US is a huge market relative to France, so with higher volumes, companies like Nintendo and Apple are probably able to negotiate better deals. Alternative, could the merchant, like Apple, be directly responsible for charging higher prices, because they 'can'? Considering the current economic situation, it would be in everyone's interest to cut prices as low as possible to shift stock, so the larger profit margin could be a contributing factor.
4. Customs/duties/shipping: The cost of shipping items and tax/duties/fees could also contribute to the costs. While the recent VAT cuts aren't much, they will still contribute to the actual figures. Freight and shipping costs to a European port like France or Germany will also have different costs. Same with import duties.
Perhaps you have a better explanation? If so, please share them, because I am out of ideas :)
Even if you aren't sure, do share your own thoughts and opinion on where British consumers are continually being scammed. Maybe you have thoughts on the bills we pay for rent, gas, electricity, food, the dentist, council tax... to name a few.
This discussion may give us some answers to our cultural beliefs on whether we feel like we are often paying more than we should, or if we really are living in a rip off culture.