GST On Overseas Purchases Is 'Nonsense', Says Woolies CEO

We know Gerry Harvey harbours an intense dislike of Australians going overseas for their purchases and the consensus from other bricks-and-mortar retailers has run along a similar vein. That's until you look up Woolworths and its current CEO Grant O'Brien — O'Brien is more than happy to tell Harvey exactly where he can put his demands for government intervention.

Image: monkeyc.net.

O'Brien recently took a stab at the likes of Harvey Norman and David Jones at the Australian Chamber of Commerce. According to ZDNet, O'Brien called requests from traditional retailers for additional taxes or application of the GST on overseas purchases as "nonsense". Said O'Brien:

Much of the conversation has focused on the question of the GST threshold on imported goods. Yet, the savings available to consumers on many products can far outweigh the current GST threshold, making this point irrelevant.

He believes retailers need to drop their prices and win back consumer trust; as online shopping becomes more prevalent, it's becoming clearer to the masses just how much extra we're paying compared to the US (and usually from a smaller range). Then, of course, there's the issue of poor customer service, which, from what I've seen, is a fairly consistent complaint among Lifehacker readers.

You won't get an argument from me that retail stores should be looking to cut their prices if they want to compete, yet, I can't help but feel Woolworths is in a much better position than the likes of Harvey Norman or David Jones. For one, I don't see anyone buying fresh foods from the US (or elsewhere) any time soon.

Woolies CEO slams online retail whingers [ZDNet]


Comments

    Interseting point, nice to see someone is living in reality

    Price is not the only factor, convience & range are just a couple. I like the fact that if a local retailer doesn't stock what I'm after, I can usually find it online, usually taking less time to arrive ten it would take the retailer to get it into stock.

    I buy all my camera lens on line, simply because I can never find a local retailer who has what I want in stock when I want it

    I also buy Lego online for te same reasons

    This whole thing about online retailers killing local retail is all made up by the companies complaining about it. I buy small things online, and am only just starting to consider larger purchases now I can see the savings. I can buy a 300W Ashdown bass amplifier from the US for about $600-$700 with postage, I can't buy any 300W amplifier here new for under $1000 unless it's a Behringer.

    It's not like local retailers have their prices so much higher because they have to either. I purchase computer parts locally because I can get a part new from MSY or PLE cheaper than I can used on eBay.

    It's all about the money, and retailers don't like that we can purchase from the US (even with the outrageous postage prices compared to other countries) and save more than we can here. It's time they stopped whining to the government for help and made themselves more competitive.

    Consumers may not be bypassing Woolworths by purchasing fresh food overseas, but plenty are bypassing them by purchasing food online. For example, through Aussie Farmers Direct (www.aussiefarmers.com.au).

      Woolworths owns Dick Smith and Big W so it's not like Woolies isn't at risk though.

      +1 (that is .5 for the link and .5 for your name.)

      MOAR pimpage for AussieFarmers direct!!

      http://www.aussiefarmers.com.au/

    buy whatever you can online. distributors here are all about finding a way to take us for a ride.

    Hmmm, Nikon binoculars locally @ $250+ or from US with postage@ $99? How can the difference be justified with identical specifications (ie no Oz specific stuff)?

    Gerry harvey is a tool.

    Isn't this the same Woolworths CEO who is closing 100 Dick Smith stores and selling of the remainder because they can't make a decent return? Bit hypocritical.

      I think he/Woolworths group did that because of the current policy and pricing climate in AU. Therefore, now he's coming out with that attack.

      Does that make sense?

    unfortunately for the most of electronic items, clothes, etc... the wholesalers/importers are the real culprits here for most small and medium sized businesses. they put such a large markup on the items they import it makes it very hard for the retailer put them up for sale at a competitive price.

    most people will shop where the cheapest price is, this fact will never change, and its only going to become even more prevelant as cost of living prices go up (Carbon Tax?). All the daily pressure of finding money and earning enough to live, its no wonder people go online to get the best price. shop loyalty doesnt really exist anymore.

    for me its at the point now where if I want a life for me and my family (where we can actually go out and do stuff) we might have to sell our second car and start riding to/from work.

    Don't forget Woolworths owns Big W, Dick Smith and Masters too, all of which sell the sorts of things people are buying online. They're not just (the) fresh food people.

    There are many factors here. Buying volume, we don't buy as much as the USA, wages are high here we have made a decision not to create a poor working class, pay a clerk in a grocery/restaurant what they are paying in the US and prices will come down. But don't worry as we outsource our jobs to overseas we will all be out of work and won't be able to buy any of this stuff GST free or not. As a Canadian now living in Australia I can see the same things happening here as what happened in north America and it doesn't end well. Politicians talk about the service industry but really we'll be servicing the ones who are retiring the ones with past savings. Once we've depleted their money we're F'd

      The problem is we're eradicating store clerks all together - have you not heard about self check-out? Coles and Woolies seem to be pocketing the difference on that front... But yes, I do wonder what will happen to all the Uni students/part-time working parents who rely on this sort of work to keep themselves off welfare...

      Pauls hit the nail on the head here. If we want stuff cheaper somebodys gotta miss out. I live in a Vic country town thats had manufacturing jobs replaced with retail jobs, of course wages went backwards no o/t part-time only, and all the Shire councillers pat themselves on the back thinking what a good job they've done. Reading Joe Bageants books wiil show you were we are going in Oz.

    Message to Big retailers...
    Drop the price first but most important start thinking about choice we have buying or rather asking for items they do not in stock...
    I give you just tinny example; I was looking for Mp3 player for my daughter and going to all retailers I was shocked , there was choice of nothing else but apple product Ipod !
    I remember just 2 years ago there was so many different brands available...
    Thanks to online shopping I found so big choice that have to spent a couple of hours to make my mind.
    In final I got what I want and price was great not to mention delivery time very good too.
    Conclusion; if they introduce new tax rules then I still will buy online because even extra tax will not scare me ! Overall choice is my priority and price will be lower then local retailers are dictating.
    We are living in 21 century Guys !!!
    If others can be happy with 100% profit why you are not happy with 500 % profit ??? that's grid !
    You're too lazy to see the true
    Remember ! I still will be buying online ! Your ideas sucks . You forgot how buissnes man should think!
    That's what you're trying to do is pure communism !

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