I must be missing something

[Anthony5]

We all know that the cost of living in Thailand has risen a lot. Not only because our home currencies have lost. in value against the Thai Baht, but also because the price of goods, and specifically western goods, in the shop goes up daily.

The reason for this is of course the strong Thai Baht, because if the Baht gets stronger Western goods.................................Hey wait.

If the Baht gets stronger the price of Western products should decline. A imported product from Europe, which is 1 Euro over there, would have been 45 Baht 6 months ago but now only 34 Baht, unless the price of the item has increased in price in Europe.But from reports of members who visit Europe frequently that seems not be the case.

So for example in the case of Big C, who import their Western items from their mother company Casino in France, most goods should have declined in price. The fact is however that imported food products in Big C, and this is not restricted to Big C only, have actually increased by at least 30% over the past 6 months. I can give plenty of examples. So at the end the Baht is 30% stronger against most of our our home currencies compared with 6 months ago, while during the same time prices of Western products have increased by at least 30%, that makes a difference of at least 60%.

Take on top of that the fact that transport prices have declined because of the significantly lower oil price, it is clear that I must be missing something.

Anyone care to explain me?

[mesquite]

The USD has stayed the same with the baht over the last 18 months. Also, Americans are quite wealthy now due to the US stock market run up in recent years as well as the strong dollar.

There are a lot of Americans in Thailand and they can afford to pay high prices. It's supply and demand.

[buhi]

Big C price by supply and demand of Americans! Yeh loads of them! But I don't see them; maybe non in Bangkok, but Big C prices in Bangkok are rising. Maybe I should ask for a discount as I am not American; the non American Big C discount card, ther's an idea!

[Anthony5]

The USD has stayed the same with the baht over the last 18 months. Also, Americans are quite wealthy now due to the US stock market run up in recent years as well as the strong dollar.

There are a lot of Americans in Thailand and they can afford to pay high prices. It's supply and demand.

Strange, I read reports on here that there are not much Americans in Thailand due to the long travel distance, and also because Thailand is so much more expensive than the US or other closer by holiday destinations.

You must also have missed the thread Leaving Thailand for good which are mainly Americans who return home.

So what Big C or Tesco, which are European companies have to do with America is beyond me.

[mesquite]

Many American retirees live in Thailand. They are paid in USD, the world's reserve currency, very strong right now. In addition, as I said, they are wealthy due to the stock market run up. They have no problem with the prices at Big C and elsewhere.

[Robert24]

Maybe you should start importing goods into Thailand. If your observation is correct, you could make a lot money.

[Anthony5]

Many American retirees live in Thailand. They are paid in USD, the world's reserve currency, very strong right now. In addition, as I said, they are wealthy due to the stock market run up. They have no problem with the prices at Big C and elsewhere.

First of all the topic is not about how many Americans live in Thailand or how wealthy they are, I'm sure the 46 million Americans on food stamps are not included in that wealth.

Secondly there are much more other nationalities, who's currency has got weaker, living in Thailand all together than there are Americans, so why would Thai companies have their price policy directed at a minority group of people.

You will know that UK is the most represented in Thailand, with Germans next and Australians third.

Thirdly, if it goes so well with the sale of their imported products, then explain to me why the amount of goods nearing expiration date, and be sold at 50% discount, has been at least six folded over the past months.

Edited April 19, 2015 by Anthony5

[Anthony5]

Maybe you should start importing goods into Thailand. If your observation is correct, you could make a lot money.

May be you want to explain to me what's wrong with my observation.

[Robert24]

Maybe you should start importing goods into Thailand. If your observation is correct, you could make a lot money.

May be you want to explain to me what's wrong with my observation.

I don't know if your observation is correct, I hardly ever go shopping in BigC etc. All I know is that if what you say is correct, you can make a killing by important goods and selling them cheaper than competition. Make sense?

[Anthony5]

Maybe you should start importing goods into Thailand. If your observation is correct, you could make a lot money.

May be you want to explain to me what's wrong with my observation.

I don't know if your observation is correct, I hardly ever go shopping in BigC etc. All I know is that if what you say is correct, you can make a killing by important goods and selling them cheaper than competition. Make sense?

Importing goods myself is not my business, and also not the topic of this thread, because I am not a multinational who has the supermarkets in place already.

You rarely shop at Big C because you actually don't live in Thailand?

As I said in the OP, my observations are not limited to Big C, but prices of imported goods from Europe have significantly increased in EVERY shop in Thailand.

Edited April 19, 2015 by Anthony5

[Robert24]

So what is your topic about?

[Anthony5]

So what is your topic about?

I would have thought that anyone, with a brain at least the size of a green pea, would be able to comprehend the text in the OP.

So for you only.

If foreign currencies get weaker against the Thai Baht, it is only logical that importing goods from those countries becomes cheaper in Thai baht terms, especially since also shipping cost have declined because of the 50% decline in oil prices.

So since most Western currencies, except the US$, have weakened by about 30% and prices of imported goods in Thai shops have increased by at least 30% during the same period, prices have actually increased by 60% where there logically should have been a reduction of 30%.

So where is the logic the prices of imported goods increase instead of decrease.

Edited April 19, 2015 by Anthony5

[Goldieinkathu]

I totally agree with your observations and was just talking about this yesterday.

The only conclusion I could make was that the big companies are increasing their prices here to cover the losses they are making in Europe.

I see many people who shop in Tops and obviously don't care how much they pay for imported items. As you say, it's not only food stuff.

Even when produce is reduced 50% due to sell by date they'll still be making a profit.

Apart from petrol prices I can't think of anything I've bought recently that's gone down in price, there's the odd offer here and there but nothing stays at the reduced prices for much longer than a couple of weeks.

Someone's making a killing for sure.

[irishsmile]

I gotta agree with the OP..... problem is.... Try explaining it to a thai with a traditional government education! Not that it would make any difference to them even if they did understand anyway.

[Robert24]

So what is your topic about?

I would have thought that anyone, with a brain at least the size of a green pea, would be able to comprehend the text in the OP.

So for you only.

If foreign currencies get weaker against the Thai Baht, it is only logical that importing goods from those countries becomes cheaper in Thai baht terms, especially since also shipping cost have declined because of the 50% decline in oil prices.

So where is the logic the prices of imported goods increase instead of decrease.

The answer is very simple: this happens when markets are not efficient, i.e. Lack of competition. If there is a lot competition prices adjust right away.

So back to my comment: if you see a business opportunity like this you should grab it even if it's outside your comfort zone.

[Rod Wallop]

Many American retirees live in Thailand. They are paid in USD, the world's reserve currency, very strong right now. In addition, as I said, they are wealthy due to the stock market run up. They have no problem with the prices at Big C and elsewhere.

First of all the topic is not about how many Americans live in Thailand or how wealthy they are, I'm sure the 46 million Americans on food stamps are not included in that wealth.

Secondly there are much more other nationalities, who's currency has got weaker, living in Thailand all together than there are Americans, so why would Thai companies have their price policy directed at a minority group of people.

You will know that UK is the most represented in Thailand, with Germans next and Australians third.

Thirdly, if it goes so well with the sale of their imported products, then explain to me why the amount of goods nearing expiration date, and be sold at 50% discount, has been at least six folded over the past months.

Yes, there is always a sale on nearly expired goods at Tops. Aussie cheese should have dropped with the Aussie dollar but remains high

[Anthony5]

Many American retirees live in Thailand. They are paid in USD, the world's reserve currency, very strong right now. In addition, as I said, they are wealthy due to the stock market run up. They have no problem with the prices at Big C and elsewhere.

First of all the topic is not about how many Americans live in Thailand or how wealthy they are, I'm sure the 46 million Americans on food stamps are not included in that wealth.

Secondly there are much more other nationalities, who's currency has got weaker, living in Thailand all together than there are Americans, so why would Thai companies have their price policy directed at a minority group of people.

You will know that UK is the most represented in Thailand, with Germans next and Australians third.

Thirdly, if it goes so well with the sale of their imported products, then explain to me why the amount of goods nearing expiration date, and be sold at 50% discount, has been at least six folded over the past months.

Yes, there is always a sale on nearly expired goods at Tops. Aussie cheese should have dropped with the Aussie dollar but remains high

You have those sales in every supermarket but recently I noticed that at Big C, because I visit Big C almost daily, the amount of those items has sixfold at least.I assume that the same is happening at other supermarkets.

Where they normally would have a few items every day stored in a small fridge, they have now 2 fridges stocked to the top, and restocked 2 or 3 times a day because they don't have enough storage space to place all at once.

Edited April 19, 2015 by Anthony5

[topt]

Many American retirees live in Thailand. They are paid in USD, the world's reserve currency, very strong right now. In addition, as I said, they are wealthy due to the stock market run up. They have no problem with the prices at Big C and elsewhere.

First of all the topic is not about how many Americans live in Thailand or how wealthy they are, I'm sure the 46 million Americans on food stamps are not included in that wealth.

Secondly there are much more other nationalities, who's currency has got weaker, living in Thailand all together than there are Americans, so why would Thai companies have their price policy directed at a minority group of people.

You will know that UK is the most represented in Thailand, with Germans next and Australians third.

Thirdly, if it goes so well with the sale of their imported products, then explain to me why the amount of goods nearing expiration date, and be sold at 50% discount, has been at least six folded over the past months.

Yes, there is always a sale on nearly expired goods at Tops. Aussie cheese should have dropped with the Aussie dollar but remains high

You have those sales in every supermarket but recently I noticed that at Big C, because I visit Big C almost daily, the amount of those items has sixfold at least.I assume that the same is happening at other supermarkets.

Where they normally would have a few items every day stored in a small fridge, they have now 2 fridges stocked to the top, and restocked 2 or 3 times a day because they don't have enough storage space to place all at once.

That's bad news then on another front as well - if it is not selling they will reduce future orders which invariably leads to stock outs and potentially just delist the product if it is not making the required ROI.

Interestingly McVities Digestive biscuits were on sale last time I was in BIG C (last week) down from 69 to 59 baht (mind you it was only 64 baht before......) and the box size of the plain original variety (as opposed to the chocolate) has increased in size from what they were selling before.....

[asdecas]

The retail prices of imported goods, particularly foodstuffs, are affected less by any normal exchange rate fluctuations than by import tariffs that are levied by Thai Customs, and the mark ups that wholesalers and retailers impose on already inflated prices.

In general, eating as I do almost exclusively Thai food, I see no abnormal inflation. By contrast, over a period of thirty years I have seen a lot of opportunistic raising of imported food prices, probably as a result of the burgeoning numbers of foreigners visiting and resident who demand such foodstuffs; they are a perfect captive market.

Edited April 19, 2015 by asdecas

[Suradit69]

I gotta agree with the OP..... problem is.... Try explaining it to a thai with a traditional government education! Not that it would make any difference to them even if they did understand anyway.

Yes, more economic and financial advice from westerners whose economies are still struggling to emerge from the last major recession, whose banks & companies have to be bailed out by their governments, whose economies are flirting with another recession, whose governments are adding on debt like someone with a gambling addiction, whose unemployment rates are stuck on high and whose currencies, aside from the dollar. are sinking like lead turds. Maybe things would have been better if those farang bank & corporate ceo's and real estate moguls received their education in Thailand.

If you can't afford the prices, then don't buy. If life is too expensive here, move back to the collapsing Farang nanny states. The world economic mess can't be blamed on the Thai education system.

Edited April 19, 2015 by Suradit69

[pattayasnowman]

The majority of shoppers in the big supermarkets are Thais - certainly not Americans.

These imported western food products are specialty items almost specifically for Farlung and well healed Thais consumption.

Thus price increases in these products do not affect the average shopper who is not addicted to say 'Walkers' chips and are happy to buy the locally manufactured product.

The Big Supermarkets and importers want to maximize profits and they will push up the price until it affects demand. In the case of these products the Price/ Demand relationship is relatively inelastic due to the well of clientel of these products

[Naam]

The USD has stayed the same with the baht over the last 18 months. Also, Americans are quite wealthy now due to the US stock market run up in recent years as well as the strong dollar.

There are a lot of Americans in Thailand and they can afford to pay high prices. It's supply and demand.

[Anthony5]

I gotta agree with the OP..... problem is.... Try explaining it to a thai with a traditional government education! Not that it would make any difference to them even if they did understand anyway.

Yes, more economic and financial advice from westerners whose economies are still struggling to emerge from the last major recession, whose banks & companies have to be bailed out by their governments, whose economies are flirting with another recession, whose governments are adding on debt like someone with a gambling addiction, whose unemployment rates are stuck on high and whose currencies, aside from the dollar. are sinking like lead turds. Maybe things would have been better if those farang bank & corporate ceo's and real estate moguls received their education in Thailand.

If you can't afford the prices, then don't buy. If life is too expensive here, move back to the collapsing Farang nanny states. The world economic mess can't be blamed on the Thai education system.

Thanks for taking the opportunity to go off topic with your Thaier than Thai comments once again.

This thread is not about if people can afford the prices or not, there are other threads discussing that at the moment, and I recall that you are one of the members that posted that it will not take much more before you have to return home because you can't afford it anymore.

http://www.thaivisa.com/forum/topic/814844-the-prices-go-up-every-week/?p=9272591

I haven't yet reached that point, but if it continues like this I could see it becoming a worry in a few years.

As for your remark that the Thai economy is so much better than the Western, you must have missed this thread Thailand’s economic outlook worst in 40 years.

Now back on topic:

This thread is about what is the logic behind the fact that prices of imported goods rise, while they actually should decline because the value of the currency in which they are purchased has declined.

[Anthony5]

The majority of shoppers in the big supermarkets are Thais - certainly not Americans.

These imported western food products are specialty items almost specifically for Farlung and well healed Thais consumption.

Thus price increases in these products do not affect the average shopper who is not addicted to say 'Walkers' chips and are happy to buy the locally manufactured product.

The Big Supermarkets and importers want to maximize profits and they will push up the price until it affects demand. In the case of these products the Price/ Demand relationship is relatively inelastic due to the well of clientel of these products

But in fact their profit margin already increased since the purchase price from the imported goods decreased by 30%. So adding another 30% on top of that could be seen as pure greed.

[Naam]

So what is your topic about?

I would have thought that anyone, with a brain at least the size of a green pea, would be able to comprehend the text in the OP.

So for you only.

If foreign currencies get weaker against the Thai Baht, it is only logical that importing goods from those countries becomes cheaper in Thai baht terms, especially since also shipping cost have declined because of the 50% decline in oil prices.

So since most Western currencies, except the US$, have weakened by about 30% and prices of imported goods in Thai shops have increased by at least 30% during the same period, prices have actually increased by 60% where there logically should have been a reduction of 30%.

So where is the logic the prices of imported goods increase instead of decrease.

Thai logic: stronger Baht = lower import price = much higher profit increasing sales price.

they increase prices because quite obviously they can. quite often i find that some expensive goods which i am willing to buy are out of stock.

[sirineou]

I gotta agree with the OP..... problem is.... Try explaining it to a thai with a traditional government education! Not that it would make any difference to them even if they did understand anyway.

Yes, more economic and financial advice from westerners whose economies are still struggling to emerge from the last major recession, whose banks & companies have to be bailed out by their governments, whose economies are flirting with another recession, whose governments are adding on debt like someone with a gambling addiction, whose unemployment rates are stuck on high and whose currencies, aside from the dollar. are sinking like lead turds. Maybe things would have been better if those farang bank & corporate ceo's and real estate moguls received their education in Thailand.

If you can't afford the prices, then don't buy. If life is too expensive here, move back to the collapsing Farang nanny states. The world economic mess can't be blamed on the Thai education system.

Thanks for taking the opportunity to go off topic with your Thaier than Thai comments once again.

This thread is not about if people can afford the prices or not, there are other threads discussing that at the moment, and I recall that you are one of the members that posted that it will not take much more before you have to return home because you can't afford it anymore.

http://www.thaivisa.com/forum/topic/814844-the-prices-go-up-every-week/?p=9272591

I haven't yet reached that point, but if it continues like this I could see it becoming a worry in a few years.

As for your remark that the Thai economy is so much better than the Western, you must have missed this thread Thailand’s economic outlook worst in 40 years.

Now back on topic:

This thread is about what is the logic behind the fact that prices of imported goods rise, while they actually should decline because the value of the currency in which they are purchased has declined.

Yes and according to the financial geniuses in this forum, the discrepancy is caused by Americans, who based on their financial wizardry

indicated in this thread, have grown rich from the high performing American stock market and are buying up the place, driving prices up.

I dont understand your problem with this, it makes perfect sense to me.

[Anthony5]

So what is your topic about?

I would have thought that anyone, with a brain at least the size of a green pea, would be able to comprehend the text in the OP.

So for you only.

If foreign currencies get weaker against the Thai Baht, it is only logical that importing goods from those countries becomes cheaper in Thai baht terms, especially since also shipping cost have declined because of the 50% decline in oil prices.

So since most Western currencies, except the US$, have weakened by about 30% and prices of imported goods in Thai shops have increased by at least 30% during the same period, prices have actually increased by 60% where there logically should have been a reduction of 30%.

So where is the logic the prices of imported goods increase instead of decrease.

Thai logic: stronger Baht = lower import price = much higher profit increasing sales price.

they increase prices because quite obviously they can. quite often i find that some expensive goods which i am willing to buy are out of stock.

The fact that the supply in near expiration date goods has multiplied sixfold over the past few months is not really a sign that they can increase the price at own will.

[sirineou]

You are right in saying that a stronger baht means that an importer would be paying less for a particular commodity

but the truth of the matter is that there are many other variables other than fluctuations in currencies that affect final retail prices

-There are lag times to the translation of stronger currency to lower import prices,

-Stronger Baht could translate to higher profit margins for the importer rather than lower retail prices

-Importers to prevent losses from currency fluctuations often lock in a price for the duration of a contract, for instance when I bid for a building and get the contract, I lock the price for the steel at the bid price. my business is building, not commodity speculation.

- savings from currency fluctuations are eliminated by import duties and other variables specific to that commodity

etc etc etc

[Naam]

So what is your topic about?

I would have thought that anyone, with a brain at least the size of a green pea, would be able to comprehend the text in the OP.

So for you only.

If foreign currencies get weaker against the Thai Baht, it is only logical that importing goods from those countries becomes cheaper in Thai baht terms, especially since also shipping cost have declined because of the 50% decline in oil prices.

So since most Western currencies, except the US$, have weakened by about 30% and prices of imported goods in Thai shops have increased by at least 30% during the same period, prices have actually increased by 60% where there logically should have been a reduction of 30%.

So where is the logic the prices of imported goods increase instead of decrease.

Thai logic: stronger Baht = lower import price = much higher profit increasing sales price.

they increase prices because quite obviously they can. quite often i find that some expensive goods which i am willing to buy are out of stock.

The fact that the supply in near expiration date goods has multiplied sixfold over the past few months is not really a sign that they can increase the price at own will.

i never saw any "nearly expired goods" in Foodland or Best. but then i shop only once or twice a month and that only for a fistful of specific items.

[Anthony5]

The fact that the supply in near expiration date goods has multiplied sixfold over the past few months is not really a sign that they can increase the price at own will.

i never saw any "nearly expired goods" in Foodland or Best. but then i shop only once or twice a month and that only for a fistful of specific items.

Some shops have a policy to sell near expiration date goods at reduced prices, some don't, Foodland doesn't have that policy but Big C, Tesco, Tops and Villa have.

In Big C you will find the French cheeses in that section. Normally there would be 4-5 pieces on such an occasion, these days there are 25 - 30 Camembert or Brie in the 50% reduction section.