Hollow Sun charges US more?

[BBFG#]

I was interested in a couple of their products and put them in the cart to buy.
But instead of 35 pounds listed price was shown a 70 dollar total.
Conversion rate puts it currently around 53-54 dollars.
So I emptied my cart.

Is this their usual practice to gouge other currencies?

[EvilDragon]

Hello, BBFG. This was explained in the newsletter and also on the front page with the news, after we've moved product distribution from Payloadz to FastSpring, to comply with the new VAT regulations in EU starting Jan 1st 2015.

If FastSpring had worked the same way Payloadz did (main currency GBP, everyone pays according to that amount converted upon payment), things would remain the same. But FastSpring operates in USD, so the whole world pays in USD except UK. And then it's still VAT on top of that for UK and the rest of EU folk.

The main reason for price increase is to try and balance the USD price vs GBP+VAT one. Also, while Steve was alive, a lot of people were telling him he was crazy to offer his products at the prices he did. But the most important reason is because Steve's family definitely needs as much financial support as they can get.

I will very likely completely remove GBP prices from the site and make USD the main operational currency for HS purchases. That ought to even out things even more. But this will be done when the website update comes around (which shouldn't be too far off, a month or so hopefully).


I definitely understand that some people might not be fond of this move. But as it currently stands, it seems that a big chunk of sales (over 50%) that came through since FastSpring service was activated for HS, came from the USA, despite the price increase. Take that at face value if you will.

[masterhiggins]

Well one of the reasons why the USD has so much buying power despite the gbp exchange rate is because we don't pay 20% Vat on everything. On top of that, the US doesn't benefit from vat, only sales tax, which is usually only about 7% depending on location. Another option to balance the amount is to lower the gbp sale price.

-Sam

[BBFG#]

Sure killed an impulse buy. And to penalize a customer to even out the countries taxation is not a good argument. VAT is what the EU gets, not the company. So are you saying that the company still pays that VAT when selling to the US?

BTW.
Our sales tax is closer to 9%

[EvilDragon]

And to penalize a customer to even out the countries taxation is not a good argument.

And this is why I listed a few more arguments, too.

[BBFG#]

And to penalize a customer to even out the countries taxation is not a good argument.

And this is why I listed a few more arguments, too.

Not really, they are mostly justifications for the same argument.

Was only slightly interested in them and apparently this seems to have killed that.

[fmr]

If you are located in the EU, you will be confronted with things like this often since the beginning of 2015. Read the thread about MOSS VAT rules.

[BBFG#]

If you are located in the EU, you will be confronted with things like this often since the beginning of 2015. Read the thread about MOSS VAT rules.

But I don't live in the EU and shouldn't be confronted with paying their governments fees, especially if those fees are not going to them but just become an extra profit for the company.

I do like those two products well enough to wait for a sale (a real one) though. Maybe then.

[EvilDragon]

As said, I will likely remove the GBP prices from the site and from the FastSpring cart in due time, so it will be a global price increase.

[BBFG#]

As said, I will likely remove the GBP prices from the site and from the FastSpring cart in due time, so it will be a global price increase.

And as I said, I'll wait for a sale then (BOGO or a decent percentage more than VAT).

[Compyfox]

Okay... let's do a quick math here.

Let's say I am interested in vKS20 (which I am, since it's cheaper than what Gospel Musician offers).
This one costs 20GBP, or according to OANDA Exchange Rate about 25,60EUR and about 30USD.

Now here is the thing (at leas to my understanding:
You have to have a certain base price, plus a certain amount of profit. And from that, you have to draw away the taxes to have enough plus so that things work out for you on the long run. And let's not forget fees for the company that handles the digital stuff (let's assume 5% per sale).


Now let's assume that the GBP + VAT prices are the prices including base amount, profit, taxes and fees.
We could call it "retail price".

The VAT rates are currently
Germany - 19%
UK - 20%
USA - none

So the retail price would be:
Germany: 25,60EUR + 19% +5% = 31,74EUR or 37,90USD (actually, formspring requests about 35EUR from me - so the exchange rate is worse than PayPal!)
UK: 20GBP + 20% + 5% = 25GBP or 32 EUR or 37,90USD
USA (fees included!): 40USD or 33,86EUR or 26,38GBP

Hollow Sun makes less(!) profit from sales in the EU since VAT is "included" compared to outside EU sales.


I can understand the frustration, and yes - one option would be to write in big bold letters on the page (which Hollow Sun thankfully did): prices plus VAT (where VAT applies) and start with one base price from one currency. But then you still have to take hugely shifting exchanges rates into account.

i.e. PayPay usually asks for more(!) from changing from Euro to USD (or the other way around) than i.e. OANDA - which is an up to additional 10% that will be cut from your profit. Pretty much every online banking system does that. Plus involved fees.



So the blame is not on Hollow Sun alone - but also on the "system".
Sometimes I also stumble into sales and be like "well, 20USD? that's like 16,50EUR for me - buy!". And once I hit the checkout button, I am greeted with like 18,90EUR or something due to crazy exchange rates and hidden fees.

[BBFG#]

This is 'playing the system' though. Increasing one to recoup the perceived losses from the other.
But for me, it means I now won't consider their products until I see a hefty sale offering.
And I'm sure I'm not the only one that shops this way.

[Numanoid]

This is 'playing the system' though. Increasing one to recoup the perceived losses from the other.

Welcome to the club, this is what most users in EU have had to endure with all along while US customers got away with it.

I can't remember you sticking up for us then, but now that you experience yourself then it becomes a problem

Over the years I must have paid several hundred dollars more being forced to pay in Euro rather than dollar when shopping at Cakewalk for example.

[EvilDragon]

Well, HS was never big on sales. But I did a 20% off Black Friday sale and it was very successful. I won't be overdoing on sales either, but I could intersperse them here and there. However - don't expect anything eye-dropping as 50% off. This would be underappreciating the value of HS products, IMHO.

[Numanoid]

IMO the Hollow Sun stuff is of so high quality that it is easily worth to buy, even with added VAT.

Casual users who just want to check HS out, why don't go for the free stuff, which is great too: http://www.hollowsun.com/HS2/freepacks/index.htm