Demographics: The Price of Things

[VirusType2]

Coffee is much more expensive than tea here in the US. There could be a number of reasons for this, for example - where is it grown, how well does it grow here? But I think it's because tea is not all that popular in the US, while coffee obviously is (heard of Starbucks?).

Starbucks Corporation (NASDAQ: SBUX) is an international coffee and coffeehouse chain based in Seattle, Washington.

Starbucks is the largest coffeehouse company in the world,[4] with over 17,817 stores in 49 countries, including over 11,000 in the United States, almost 800 in the UK, and nearly 1000 in Canada.

While it is certainly true that - being of US origin - Starbucks is simply not as prolific outside of the US, I think it is still worth mentioning.

So, could it be, that because of its popularity in Britain, tea is very expensive there, and coffee is worth less? I ask you.

Please discuss price differences between regions. I don't expect this thread to really take off, but I was just wondering.

I suppose this may turn into complaining that video games are expensive where some people live. By all means. Which reminds me - people say that computer parts are cheap in the US. For example, a S.Korean designed Samsung device is half price in the US, compared to S.Korea. (I'm aware that it is made in China, just saying)

 

[Danimal]

Everything is pretty expensive down here, though that's cause a pretty big majority of stuff is imported - We are an island afterall!

 

[dfc05]

I feel like coffee might just cost more to grow and process?

At first I thought the beans were hand-picked, but a quick wikipedia check says they're harvested by machine nowadays. Anyhow, seems fruits of plants would be more intensive to grow than a bunch of leaves, but I don't really know.

I did hear a couple of years ago that chocolate (cacao beans) are still picked by hand though, because the beans don't ripen all at the same time so someone has to go around and decide which ones to pick. Which would be why high quality dark chocolate is more expensive.

Anyways, I have never been to the UK so I can't comment on that .

And... yes, I have heard first-hand that electronics cost 2-3 times more (after accounting for currency conversions) in Asian countries than in the U.S. -- especially Singapore and Thailand. One of my Thai labmates bought electronics here and shipped them to Thailand for his friends because even with shipping, they still saved money. It doesn't make any sense to me. A girl I knew from Singapore also complained that Microsoft software was very expensive there, even though Singapore has ridiculously strict anti-piracy regulations.

 

[Acepilotf14]

Virus, what you're trying to say is called 'supply and demand'.

 

[Mr Stabby]

I'm assuming the coffee market is larger than the tea market, if so then coffee is more subject to commodity speculation.

 

[ríomhaire]

Are you telling me that businesses try to make profits?!

 

[Eejit]

I feel like coffee might just cost more to grow and process?

At first I thought the beans were hand-picked, but a quick wikipedia check says they're harvested by machine nowadays.

Tea leaves are hand-picked. At least at the tea plantations I've seen.

 

[Remus]

Are you telling me that businesses try to make profits?!

Yes, unreasonable profits. Over here for the price of an iPhone 4 you could easily buy a top of the line desktop computer. That's how ridiculously overpriced mobile devices are, because obviously we are a rich nation and we can afford it. ROFL

 

[VirusType2]

Virus, what you're trying to say is called 'supply and demand'.

Indeed, but this just but one factor of price setting. What I am trying to avoid, is discussing supply and demand, while at the same time, not ignoring that information.

Like consider the practice of "price gouging", for example, charging 5 times more for a snow-shovel during a snow storm. Demand is up, but price gouging is illegal. If they could, they would totally charge as much as possible, regardless of the supply.

So it's not just supply and demand, it can also be simply: demand. And that's what I want to discuss here.

Well anyway, its starting to look like the price difference of tea/coffee isn't really any different in Europe, so this kind of puts a lid on that. But consider for example that the Xbox 360 was 2 or 3 times as expensive outside of Japan, because the demand was low in Japan. Supply is irrelevant here.

 

[No Limit]

Yes, unreasonable profits. Over here for the price of an iPhone 4 you could easily buy a top of the line desktop computer. That's how ridiculously overpriced mobile devices are, because obviously we are a rich nation and we can afford it. ROFL

I always find that amazing. Poland is the same way, electronics are expensive as shit there. I remember my uncle bragging about this sony stereo he bought for $600. The same one here in the states would have went for maybe $150. And their average income in Poland is a tiny fraction of what we make here.

But they have it good when it comes to food and housing. If you're not in a city a 1 bedroom apartment runs around $100 a month whereas I pay close to $700 for mine here.

 

[kupocake]

UK:
- Tea is not more expensive than coffee. It's always substantially cheaper. Usually about a third of the price?

- Starbucks has a reputation for being as prolific as it is in the US. That's partly down to the influence of US pop culture (e.g. most comedies that mentioned Starbucks in the early 00s), but 800 stores across the smaller span and population of the UK isn't unimpressive. Bare in mind that the UK simply doesn't have the kind of urban sprawls that the US has either.

- There are other chains of Coffee shop like Costa that are quite prolific. When Starbucks moved into Brighton's North Laine, there were protests (the Laines are a mostly independent, verging on Bohemian set of streets with shops, cafes and restaurants).

- Drinks in general (and in bars and restaurants rather than shops) always seem to be more expensive 'on the continent' (and in Ireland actually). Though 'the continent' is usually shorthand for 'France, Belgium, Holland and maybe Spain' and you can get inexpensively paralytic in Central and Eastern Europe (hence all the stag parties).

- Consumer electronics and software in the UK are always more expensive, but I think we're leveling out against the continent now that the Euro has taken a dive.

 

[Viperidae]

If they could, they would totally charge as much as possible, regardless of the supply.

And then the businesses that sell them at reasonable prices would get more clients.

Basic economics: beyond hl2.net.

 

[Krynn72]

And then the businesses that sell them at reasonable prices would get more clients.

Basic economics: beyond hl2.net.

Please, beyond VirusType2.net more like. I saw this thread before anyone had posted in it, and I was about to go ape shit on Virus for not knowing of such a basic concept, but I was sick of arguing with people who don't know what they're talking about, for that day at least.

 

[Eejit]

Saw this yesterday, kinda relevant.

 

[ríomhaire]

Drinks in general (and in bars and restaurants rather than shops) always seem to be more expensive 'on the continent' (and in Ireland actually)

We have high taxes on drink.

 

[VirusType2]

And then the businesses that sell them at reasonable prices would get more clients.

Basic economics: beyond hl2.net.

Please, beyond VirusType2.net more like. I saw this thread before anyone had posted in it, and I was about to go ape shit on Virus for not knowing of such a basic concept, but I was sick of arguing with people who don't know what they're talking about, for that day at least.

/face palm

Nothing annoys me more than being corrected when I'm right, by someone who is wrong, except when that is also followed by an insult. Do you not understand price gouging?

short-term and localized, and by a restriction to essentials such as food, clothing, shelter, medicine and equipment needed to preserve life, limb and property.

http://en.wikipedia.org/wiki/Price_gouging

You think I didn't know that competitive pricing gets customers? Did you not know I am more than 4 years old?

Should I have gone into detail on the stock market and the value of all the world's currencies too before you could follow along?

I was sick of arguing with people who don't know what they're talking about, for that day at least.

HAHAAHAa This.

 

[AiM]

Indeed, but this just but one factor of price setting. What I am trying to avoid, is discussing supply and demand, while at the same time, not ignoring that information.

Like consider the practice of "price gouging", for example, charging 5 times more for a snow-shovel during a snow storm. Demand is up, but price gouging is illegal. If they could, they would totally charge as much as possible, regardless of the supply.

So it's not just supply and demand, it can also be simply: demand. And that's what I want to discuss here.

Well anyway, its starting to look like the price difference of tea/coffee isn't really any different in Europe, so this kind of puts a lid on that. But consider for example that the Xbox 360 was 2 or 3 times as expensive outside of Japan, because the demand was low in Japan. Supply is irrelevant here.

At the end of the day, all your scenarios still fall under Supply and Demand. Take your snowstorm example, raising the price regardless of supply wouldn't make any business sense. You raise it to the point where you maximize your profits by selling your last shovel at the maximum price your customers are willing to pay. If you increase your price regardless of supply, what you end up with is customers will simply seek an alternative or look for a shovel elsewhere.

As for the Xbox 360 in Japan example, simple economics. Low demand so they reduce the price to increase demand.