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Q: Imported drinks and cigars in China -why so expensive?
Hi
Well why pay these outrageous prices when we can supply at more pleasing ones?
Almost everything imported into China is slapped with a high import tax (between 20% and, oh dear god, up to 270%) depending on what the product is and where it's from.
This is a protectionist move by China to keep their currency undervalued and promote sales of domestic products. For example, if high quality US milk could be sold here for competitive market prices it would shut down every Chinese dairy.
Drinks - same thing. Major brands have local partners (Coke, Pepsi, etc) and imported alcohol is subject to the taxes as mentionned above, mainly to promote local brands.
Cigars - tobacco is a government run industry in China, so not much changing that.
skater:
Isn't that the same practice many countries in the world have? Canada, for example, would not allow dairy products from US or other countries to enter its market easily even if the price of dairy products is more competitive than that of Canadian dairy products if no tariff or quota system is implemented.
I'm not sure what your second sentence means, but if you reckon in exchange rate, they're generally only slightly more expensive then they would be in the countries they're made in. Then, if you factor in middle men, shipping, tarrifs, extra price for exotic etc. it about what you'd expect.
It's two things.... The extremely high taxes as mentioned above.
Second, it's the mentality that a product must be good because it cost more. So those with money are more than willing to pay the extra just to show off that they have to money to buy the expensive imports.
Then it's all relative. The imported alcohol and spirits at my local big-name supermarkets are actually not that much more expensive than what I would pay for the same products at home but then I come from a high-tax area of the country. I priced a bottle of Jim Beam the other day at about USD 20.00 in the supermarket and that is about what I would pay for it at home. French wine prices were very similar.
Apart from the tariffs and shipping and all that, its just good marketing here.
It goes for most brands. Take starbucks for example. A cup of black coffee in the states is just under $2.00 for the biggest size, but its a little over $3.00 here. They moved into the market and set themselves apart as something to be desired, something that ups your image. Setting the price too cheap and then everyone can have it, and its nothing special.
Even though something may not be worth the value, it is a show off to others that you have it(can afford it) or giving face to others when given as a gift.
Another good and obvious example is car buying, and the lack of used car buying. or the outrageous cigarettes and baijiu prices. or the fancy restaurant prices....its everywhere
