Comments on: Idiot taxes mean business opportunity

By: Jason Glover

Jason Glover — Wed, 08 Jul 2009 04:08:03 +0000

I consider Lotto to be an idiot tax.

And bottled water.

- Water in plastic bottle ~$10 per litre (in “convenience” sizes)

- Water from tap ~ $0.00004 per litre.

By: Perrin

Perrin — Wed, 17 Jun 2009 23:20:59 +0000

Button cell batteries at DSE… $6 each! Warehouse Stationary have name brand batteries, $4.50 for 2. Online auction sites have no-name ones, $10 for 50.

Memory cards at camera shops (or any shop). I’ve even said to a sales guy once, “you don’t even try to compete with online stores do you?” and he looked a bit hurt, then just said no.

And sometimes what looks like an idiot tax actually isn’t anything to do with the retailer. Contact lenses cost around half as much to buy online as from your optometrist. But assuming my optometrist isn’t lying to me (I don’t see why he would), he can’t even buy them from the supplier as cheaply as I can online, because he doesn’t buy as many. I guess as more people cotton on, he will have to put up his consultation prices to stay in business.

By: Nick

Nick — Wed, 17 Jun 2009 21:18:57 +0000

Great article Lance.
There’s another factor at play here … Idiot Tax is perpetuated not only by idiot consumers, but by idiot businesses.

In service sectors (Airline, Rentals and Hotel) when ‘the company’ is picking up the tab, idiot business’ staff switch off to these price weightings and the providers are able to quickly convert their discounted corporate rate into a profit margin.

Business class airfares are perhaps a good example of this.

You’ve recently offered some great ways for businesses to reduce costs without loss of value, flying economy is another.

By: raf

raf — Wed, 17 Jun 2009 02:58:23 +0000

Isn’t the “market” supposed to take care of these anomalies?

I could spend hours searching the web for an item and then go through the ordering process. Or I could walk into DSE and in 10 minutes be out the door with gear in hand.

Which is exactly what I did the other day when I picked up a new laptop…was discounted, good value and I haggled over some extra RAM which the guy put in for me on the spot.

Now I think I got a pretty good price for it but who knows it may be available elsewhere for a bit less. But my time is precious and saving $50-100 on a laptop on my desk and ready to go within 30 mins against an online search and possible wait isn’t even a question.

As far as your cable example goes surely there’s an online place for that. There certainly is for laptop batteries and the like.

But the point is that the market will always move to attack overpriced goods and certainly that’s the case with the web and open shopfronts like trademe.

By: Marshall

Marshall — Wed, 17 Jun 2009 01:55:29 +0000

Living over here in Singapore there is a “idiot” tax on everything.

Well, actually it’s more they just want to bargain the price on just about everything. E.g. I call for advertising rates the other day and get a document quoting $30 CPM. That’s ridiculous so I complained and get back “Oh, that’s just the rack rate, we’ll discount it”.

What gets me however, is that if I don’t know a fair rate for whatever I purchase (how much is that green-stone bracelet I want to buy my girlfriend?) I get scared away because I don’t know the price. I’m more likely to walk away ripped off than getting a bargain as the retailer knows the exact price. So I end up not purchasing!

I think the idea of the one price all up, no hidden fees or taxes *ahem airlines* is a great model and it would win me over with its simplicity.