The Aussie dollar hit an all-time, post-float high this week - hovering around $1.02 - largely driven by 'risk sentiment trends' in market circles and a firm correlation with the MSCI World Stock Index.
by Jeni Bone
This means, that with confidence under assault from multiple fronts in the week ahead - Bahrain, Libya, Japan - world events are likely to bump the currency along for the ride.
Locally, it has proven a boon for online shopping, from Woolies and Coles e-supermarket orders to pricey and prestige goods like boats, houses and cars.
For Australian retailers, the dollar's rise is a 'double-edged sword', Australian Retailers' Association Russell Zimmerman said. 'The real problem is that we are getting a deflation in the price of goods. For electrical goods, it's a 25 to 30 per cent deflation. You have to get more products through your door to maintain a dollar margin that you are used to.'
The strong dollar is likely to place pressure on the Reserve Bank to raise interest rates, and a rise would reduce consumers' spending power and increase retailers' finance costs, Zimmerman observed.
Shopping online from US websites has also become more attractive for Australians, eager to flaunt their pumped up currency on supposedly 'good deals'.
But all that glisters, as they say. The big brands in the marine sector are united in their sentiment that it's a case of 'buyer beware'.
Damien Weber, head of sales and marketing at Navico, observes that everything is on sale on the net. 'It's happening with boats, consumer goods, electronics. Brands and etailers are competing on price. But this is how it has been for a long time.'
Navico dealers have not noticed a marked fluctuation in trade, says Weber. 'But in the case of electronics, if you bring in anything over $1000, you are liable for duty. We tell people at boat shows and through our dealers that they need to be cautious.'
There's also the problem of US goods being fitted with US maps, in the case of Lowrance HDS units for example. 'They are regionalised,' explains Weber. 'If you bought one online, you would then have to buy local charts, so it becomes complicated and expensive.'
Another thing to consider is the metric system. US units are in Fahrenheit and Feet, whereas the majority of Aussies are comfortable with Celcius and Metres.
Fortunately for Navico and its coterie of brands, 'consumer are spending'. Says Weber: '10' units are selling very well. People are showing confidence and tend to be spending from high end trailerboat upwards.'
Leigh Francis from All Marine Spares reports that there is a lot of talk of 'good deals overseas', but people need to realise they have to return any parts they import to the US for warranty issues. 'Warranty is owned by the importer. In this country, it's regarded as the manufacturer. If you approach the States, it gets very tricky. Internet sellers are often faceless, officeless entities. Locally, dealers are reluctant to handle problems that can arise with electronics and parts. Very often they don't want to know, and would you blame them?'
Serial numbers can differ from market to market, year to year, particularly with electronics.
'Being trade only, we hear that our customers are experiencing this. We have customers who say to their customers, if you want to bring it in, that's fine. But I won't fit it in case it fails. If you try and fix it you will void your warranty and blow any margin you made because you're the importer. We need to spell it out to consumers - there will often be problems and they will be stuck with an expensive bargain.'
In contrast, Francis recommends that local dealers and retailers are a good source of information and after-sales service. 'There's profit factored in to the price, which covers warranty. If it's too good to be true, it generally is.'
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3:52 AM Tue 29 Mar 2011 GMT
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