How does someone make a profit on ...

Mr_Singleton

Definitely one of the most interesting and intelligent threads I've read on MSE for a while.

One of the things that I find hugely strange is how items from China/Hong Kong NEVER seem to get charged VAT/import Duty. Over the years I've probably seen around 100 packets/parcels from these places and yet not one of them has ever had a declared value of more than $10. I saw a camera lens with a UK RRP of £2200 listed as "Glass" and valued at $5. O.K people take the micky but why aren't UK customs clamping down on this?

Conversely, I've seen people being charged VAT/Duty on clothes, framed pictures and birthday presents etc around 90% of the time from places like the USA, Canada and Australia.

Is there some unwritten rule that HMRC looks the other way depending on where the item is from?

RFW

Mr_Singleton wrote: »

Is there some unwritten rule that HMRC looks the other way depending on where the item is from?

Probably not (although I wouldn't rule it out). It's pretty random, my guess would be that they do it on postage cost. So an item sent by courier valued at £5 is more likely to be checked than one sent by standard post with the same value.

The sad fact is that no matter how many more people the government employs to check packages some will still slip through with undercharged duty. So they have to weigh up whether the duty they will get back would cover the salaries of those checking the packages. If HMRC gain £10 million on excess charges but spend £12 million on salaries (I made those figures up before anyone contradicts them!) then they may as well have no one checking and gain £2million.

There must be loads of better ways than the current system to gain some revenue. It wouldn't be too difficult to add a tax at time of purchase and let the payment provider pay it. So if I was to buy from a Chinese seller and I'm in the UK, Paypal (or whoever) would have to add 10% to the payment. This could also be done via the credit/debit card, so instead of charging 3-4% conversion rate, they charge 13-14% and give the 10% to the government.

ballisticbrian

It wouldn't be too difficult to add a tax at time of purchase and let the payment provider pay it.

But if I was Chinese, I would just set up a bank account in the EU so that the payment wasn't taxed and then still send the item in from China or wherever.

RFW

ballisticbrian wrote: »

But if I was Chinese, I would just set up a bank account in the EU so that the payment wasn't taxed and then still send the item in from China or wherever.

That's pretty much what they're doing anyway by sending stuff from warehouses in the UK.
My comment wasn't a government proposal just something off the top of my head. The fact is the current system doesn't work and is based on international trade that was done 100 years ago. How hard would it be to come up with a workable international system based on internet selling?

RHemmings

ballisticbrian wrote: »

The batteries in pound land are alkaline not Lithium and they don't stand the test of time. The only thing they are good for is getting a bunch of old watches working for a car boot sale, but they'll need replacing 6 months later.

I've heard that you can buy smaller packs of lithium CR2032s in Poundland(s) for a £1 and that they work well. I'm going to have a look and see if I can find some.

EDIT: 4x CR2032 + 2x CR2025 + 2x CR2016 at Poundland for £1 the lot. They claim to be lithium batteries, not alkaline.

I've bought these under the assumption that the 'Maxell' batteries coming through ebay will be fakes and useless, given my post-purchase research.

Brooker_Dave

mrcol1000 wrote: »

I think the moral of the story is that just because you couldn't make a profit selling at this price, does not necessary mean that a more clever seller can't.

With babzmedia everyone assumed they knew something everyone else didn't.

Then they went bust.

The moral of this thread, is, no matter which way you look at it, anyone selling stuff bigger than a postcard on ebay for 99p or £1.25 inc postage is making a loss.

And there do seem to be an awful lot of people on both ebay and amazon who mistake turnover for profit.

makeyourdaddyproud

There's increasingly less retail space for common garden variety sellers on eBay no matter what profit or structure prevails. Being a successful retailer is one that operates in a niche market (a specific product), and with good knowledge of that market. This tends to command higher respect, a better class of discerning customer, and generally more profit.

There are just too many sellers who will list any garbage, with no knowledge of the product and at any price. Hoping that any sucker will buy, they use this cue to convince themselves they are doing well, but instead suffocate themselves in conceit.

RHemmings

Interesting. I've just had ebay ask me to do a customer survey on Argos pickup. They asked a lot of questions that looked as if they were trying to build a case that pickup at Argos lead to additional business for Argos. E.g.

Apart from collecting your eBay purchase, did you do any of the following?
Please select all that apply.

Collected another purchase from argos that you had already made online
Purchased something from argos you had planned to buy anyway
Purchased something from argos you had not planned to buy
Purchased something from argos you had planned to buy from another store or site
None of these

buglawton

That seems to confirm my theory in post #14

Brooker_Dave

If Argos get taken over by Sainsburys, the pickup thing may be ditched?