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This 148 message thread spans 5 pages: 148 ( [1] 2 3 4 5 > >     
US dollar continues to tank
Time to raise prices?
Lovejoy




msg:3451633
 1:22 pm on Sep 15, 2007 (gmt 0)

Hi All,

It looks as though the US Dollar is going to tank badly from here on in. Up until now I've been eating it on the exchange rate because the American market is my largest segment, and most of my competition has not yet upped their prices. As the Canadian dollar has gone from 62 cents US to over 97 cents yesterday I'm finding it very hard to hold the line on pricing. Anyone else in this same boat and have any idea what the best course of action might be? My big concern is that surely a great many business's are in the same situation and are all going to jump their prices as soon as the competition does. This will cause a massive run up in inflation and crash the economy for us all.

Lovejoy

 

palain




msg:3451849
 8:49 pm on Sep 15, 2007 (gmt 0)

95 % of my sales are to the US so I know what you are saying.

I have maintained my US pricing for the most part because I purchase products in US currency which I transform. My transforming costs have remained more or less the same because of higher volume.

I have been trying to increase my CAD sales lately by offering CAD pricing adjusted daily with the exchange rate.

I have setup Geotargetting to automatically display either Canadian Currency or USD currency. I may also have to do the same to GBP and EURO.

Most Canadian exporters to the US made substantial profit with the exchange rate. It was even difficult to sell to Canadians because of the high USD value.

Now that Canadians benefit from an increased buying power, maybe it is time that US based firms aim for exporting to Canada.

I have stockpiled since May because of the great US exchange rate. I have purchased inventory, machines and as many personal items as I can all made possible by the lower exchange rate.

mindanao




msg:3452075
 5:34 am on Sep 16, 2007 (gmt 0)

I am located in the Philippines, with the bulk of my sales going to the USA. I finally decided to raise US$ prices about two months ago, and was surprised that it did not impact sales at all! If anything, my sales actually increased after I raised my prices! Over the past couple years the US$ has lost about 20% of it's value against the Philippine Peso. I raised my prices around 13% or so, not wanting to make such a huge impact at one time. So far, no problems, and I'll try to make another increase maybe right after Christmas to pick up the rest of the loss.

Good luck!

Lovejoy




msg:3452257
 2:51 pm on Sep 16, 2007 (gmt 0)

palain, How did you set up the geo-targeting for currency? I'm currently getting more customers from the UK, Australia and Canada and would like to set it up to display their local currency.

Lovejoy

palain




msg:3452305
 4:18 pm on Sep 16, 2007 (gmt 0)

my store is custom made by me so you will need a comfortable knowledge of PHP and MySql.

It is really two stages which are independant:
1- automatically Checking for exchange rate at the bank of Canada every day... several currencies are available put that in a database table and retrieve it as required.
http://www.bankofcanada.ca/fmd/exchange.html
You can make a fopen and insert into database the currency of interest every day.

There are a few php solutions on hotscripts.com also.

2- looking up IP in a database available for countries. The result is a two letter international code for country. Currency conversion page is found here for Bank of Canada

Database is available for free [snip]

This enables you to taylor web pages for specific countries like: Low shipping rate to UK or item Made in Canada - Item ships from USA.
or display relevant items for different countries. It is very practical to enable geo targetting.

Everyone knows that if you display canadian currency to a US buyer, they likely will not purchase.

[edited by: lorax at 12:51 pm (utc) on Sep. 17, 2007]
[edit reason] removed url [/edit]

Rugles




msg:3453211
 8:31 pm on Sep 17, 2007 (gmt 0)

It used to be such an advantage for a Canadian company shipping to the US. Now its a level playing field. Oh well.

The problem we have now is that our Canadian customers are demanding a better price for US goods. We paid for the goods several months ago, or even a year or more with a much lower dollar. So we cant lower our prices until we clear out the inventory.

bwnbwn




msg:3453212
 8:37 pm on Sep 17, 2007 (gmt 0)

Rugles I know that hurts but here is another point if the prices were going the other way would you raise them even though you bought them over a year ago at a low but the market demand has caused them to rise.

Rugles




msg:3453256
 9:22 pm on Sep 17, 2007 (gmt 0)

That is the problem.

Its not so bad if the currency rises or falls slowly. Its the sudden and huge jump that is causing problems.

Its going to par and maybe above par. Who would have guessed 5 years ago?

Rugles




msg:3453872
 2:57 pm on Sep 18, 2007 (gmt 0)

Now we are over 98 cents.

This going to cause lots of problems.

Lovejoy




msg:3454229
 7:55 pm on Sep 18, 2007 (gmt 0)

98 cents, that's it. Damn the torpedo's, competition bah....prices go up tomorrow across the board. At 98 cents it's par as far as my banks concerned with the exchange.

Lovejoy

lgn1




msg:3454270
 8:41 pm on Sep 18, 2007 (gmt 0)

When I used to deliver the Kingston Gazette in the mid 70's as a yound teenager, I used to get in trouble for accepting American money, since it was worth less than the Canadian Dollar. I believe it was around $1.04 around then.

Historically in 1864, just when it look like the south was going to win the American Civil War, you could buy close to 3 American dollars for every Canadian dollar. Fortunately I was not in business back then.

To be exact on July 11, 1864 you could buy $2.78 in American dollars for $1.00 Canadin Dollar, and it was on Par back in 1862.

This puts the volatility of the currency market in perspective.

Rugles




msg:3454295
 9:05 pm on Sep 18, 2007 (gmt 0)

Not good enough to get a route with the Whig-Standard? ;-)

lgn1




msg:3454314
 9:42 pm on Sep 18, 2007 (gmt 0)

Actually it was the Whig-standard (how can you forget a name like that) :)

At least it wasn't the Toronto Star. Many a teenage back was broken under the weight the Saturday edition of the Toronto Star. I believe there was a least a tree and a half in each one :)

Lovejoy




msg:3454423
 12:54 am on Sep 19, 2007 (gmt 0)

Oh man I remember those, my kid brother delivered the Star. One weekend he though he'd deliver the whole works from his bike and hung two paper bags, one on either side of his new mustang Bike. About a block into his delivery he blew the back tire ;~)

P.S. Canadian Dollar now at 98.57

Lovejoy

Stefan




msg:3454456
 1:39 am on Sep 19, 2007 (gmt 0)

I've been selling some digital products online for a while (though nothing commercial to the same extent as most of you folks), and decided to reprice much of it in C$ about a year 'cause I could see which way the wind was blowing (my main base is in Canada and secondarily in Jamaica).

I could be wrong on this, but maybe it's not necessary to price in US$ for American customers anymore? Most of them must understand that it's not a very solid currency at present, and Euros, C$, or various other stable currencies can be expected for pricing on orders outside of the US.

Of course, if that's the difference between getting a sale or not from US customers, I guess you should quote in US and just keep bumping it up.

Lovejoy




msg:3454476
 2:21 am on Sep 19, 2007 (gmt 0)

I also sell digital products and gave up early on trying to sell in the US market in Canadian Dollars (1997). It may have changed, but the attitude then was they couldn't be bothered dealing in a foreign currency or play about with exchange rates. I'm going to test the waters and up my prices 20% and see how the wind blows.

Lovejoy

Rugles




msg:3454895
 1:50 pm on Sep 19, 2007 (gmt 0)

We got burned on one sale yesterday. Its a $500 dollar made in Canada product and we used to make most of the margin on the exhcange rate when selling to US customers.

When I calculated the profit on the sale we barely made anything. So I immediately raised the price.

So that is where the problem is for us, Canadian made goods going to the US. We do not have that many items like that, luckily.

p.s. it is over .99 this morn. we are going to par real soon.

p.p.s. i delivered the Hamilton Spec as a kid, nice afternoon paper route back then

Rugles




msg:3456245
 5:34 pm on Sep 20, 2007 (gmt 0)

PAR!

First time in 31 years.

Stefan




msg:3456655
 1:23 am on Sep 21, 2007 (gmt 0)

Yep. As of 21:00 EDT Sep 20, it's bobbling back and forth around par by a few hundreths of a cent. It may well go up further.

Last time it was this high was when Trudeau was PM. And it had been pegged at .92 US for a long time before then. It was only over par for a few months.

Amazing to see this happening, eh?

Lovejoy




msg:3456686
 2:23 am on Sep 21, 2007 (gmt 0)

Yeah, sure is. I cashed a US check today and with the bank charge actually lost money.

Lovejoy

Rugles




msg:3457112
 1:27 pm on Sep 21, 2007 (gmt 0)

Its going to be bad for the economy.

bwnbwn




msg:3457243
 3:16 pm on Sep 21, 2007 (gmt 0)

Maybe I need to advertise more in Canada

AffiliateDreamer




msg:3457329
 4:40 pm on Sep 21, 2007 (gmt 0)

oh great, US stores now ship within Canada CHEAPER than Canadians AND their dollar tanked making it more lucrative for Canadians to shop in the US.

akmac




msg:3457465
 6:51 pm on Sep 21, 2007 (gmt 0)

Loving these Canadian sales. Seems like a weak US dollar is worse for the Canadians than it is for Americans-at least in the short term.

AffiliateDreamer




msg:3457523
 7:59 pm on Sep 21, 2007 (gmt 0)

akmac, have you seen a spike in CAN sales lately? Did it just start recently or?

lgn1




msg:3457573
 9:21 pm on Sep 21, 2007 (gmt 0)

The problem with American companies shipping to Canada, regardless of the dollar is Canadian Customs and UPS.

Shipping from USA to Canada by Courier - No Broker charges for anything under $20

Shipping from Canada to USA by Courier - No Broker charges for anything under $200

Shipping from USA to Canada by Postal Service - Canada Customs will do the equivalent of a full anal cavity search on your parcel, collect the GST and charge you a $6.00 service fee.

Shipping from Canada to the USA by Postal service. US customs rarely check parcels, and no duty or fees for parcels less than $200, however I rarely see them hold a parcel for duty for less than $500 in reality.

As you can see, as a liberal democracy, its strange that our border service is still run like if it was a facsist state.

Not really a level playing field when it comes to canada-us ecomerce. Good think im living on the north side of the fence.

akmac




msg:3457626
 10:27 pm on Sep 21, 2007 (gmt 0)

Our Canadian sales are spotty, so It's hard to nail down statistical relevance. But, the last two weeks have seen more $ coming from Canadian customers than US customers, which is the first time this has ever happened.

Stefan




msg:3457743
 2:18 am on Sep 22, 2007 (gmt 0)

As you can see, as a liberal democracy, its strange that our border service is still run like if it was a facsist state.

I fly back and forth to Jamaica every couple of months and I can tell you about that bunch. Canada "border services" is the least Canadian thing I know of. They seem to mostly take their orders from south of the border, especially since 2001. The RCMP are no different. I don't know how they get away with it.

</rant>

AffiliateDreamer




msg:3457750
 2:37 am on Sep 22, 2007 (gmt 0)

Stefan, get way with what? Don't follow you exactly

HRoth




msg:3457902
 10:49 am on Sep 22, 2007 (gmt 0)

The dollar has been dropping for a long time. Because of it, last year I curtailed buying stock from Canada and Europe that was previously at the center of what I sold. I shifted it to a sideline and raised those prices by selling smaller amounts at the same price. Next year I will be buying almost no stock from outside the US. I actually changed the focus of my business somewhat in order to accomodate this shift, because I expect the dollar to keep on dropping for a while yet.

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