Why are Apple products so expensive in SA?

Here is a letter I sent today to Apple’s European customer-relations representative. Core buys their stock from Apple Europe so they seem like the right people to contact. I hope I get feedback.

To whom it may concern

I am sending you this email because I have had service from you in the past and I was very impressed by the way Apple handled my request, even over international borders. I live in South Africa, where the sole importer of Apple is the Core Group. Currently a bit of a media frenzy is starting to form over the high prices Core is asking for Apple products. Now this is not a complaint because of the high prices of Apple in general — I will by all means always pay more for a product if it is indeed better than alternatives, and I put Apple in that group.

I cannot, however, understand how there can be such a big discrepancy in prices between SA and the US. While I understand the parties involved need to be make a profit, I refuse to believe that Apple will condone such high prices in other countries. In the US and Europe, Apple is trying to justify through effective marketing its premium prices on good quality hardware and great software, with which I wholeheartedly agree. However, imagine all Apple products was a minimum of 30% more expensive, and iPods an additional 50%. This is the sad state of Apple in SA, thanks to the Core group. (And do not think your recent hardware refresh, which have lowered the prices of MacBooks across the board has made any difference at all, they still charge the same high mark-up.)

Here are some examples:

Computers:
Baseline unibody Macbook in SA: R15 999
Baseline unibody Macbook in US: R11 041 ($1 299)
Price difference: 30%

Baseline New iMac 20 inch in SA: R14 999
Baseline New iMac 20 inch in US: R10 191 ($1 199)
Price difference: 33%

8 Core Mac Pro in SA: R40 000
8 Core Mac Pro in US: R28 050
Price difference:30% (or more than R10 000 on a single computer)

iPods:

iPod Nano 16GB in SA: R2 699
iPod Nano 16GB in US: R1 699 ($199)
Price difference: 38%

iPod Touch 32GB in SA: R5 800
iPod Touch 32GB in US: R3 400 ($399)
Price difference: 42% !!!!!

Peripherals:

Mini Displayport to DVI adapter in SA: R510
Mini Displayport to DVI adapter in US: R246 ($29)
Price difference: 52%!!!!

Now these are the cheapest prices available in SA. If Core is buying these machines at wholesale prices, I think it is safe to say this is plain old profiteering.

I plead you to pass this to your consumer-relations department — I doubt Apple wants to do its name any damage, regardless of where it may be in the world.

Some sights against Core I have come across. I should mention some of these sites are the highest viewed sites in South Africa. If you go to Google now and type Core and Apple, and view pages in South Africa, some of these articles appear above official Apple or Core website results. You can maybe just look at how many people join the discussion at 2oceansvibe, one of SA’s most visited sites. All the comments are negative.

http://www.stopcore.co.za

http://www.macgeek.co.za/2009/05/31/open-letter-to-core/

http://www.2oceansvibe.com/2009/05/25/calls-for-apple-us-to-revoke-local-distributor-cores-license/ (read the comments)

http://www.2oceansvibe.com/2009/05/19/core-group-insiders-come-forward/ (read the comments)

http://www.mpieters.com/2009/05/just-how-expensive-is-apple-in-sa.html

I really hope you can speak to whoever might be in charge of Apple’s international relations. If Apple is going to continue to be imported to SA by Core I cannot help but believe you will do your brand irreparable harm. South Africans have no way of purchasing Apple products, whether it is iPods or Macs, through any other channel. They control the entire distribution system.

I welcome your feedback.

PS: To anyone who wants to contact them as well, PM me on twitter at @mpieters, and I will send you their address with which I had service in the past. If you have written a similar blog post or letter, send me the link as well, I will add it here.