Is Australia an expensive country?

[JohnK]

I'd agree prices of things is increasing, but there are a lot of costs as a business owner these days and things can't be broken down quite as easily as you have mentioned.

I don't disagree with your comments but as a consumer I need to make informed decisions of how to spend my money and that am I getting value for the money I spend so I do need to break things down.

e.g I am still at work, it is late, and I am going home soon and I am hungry. I can eat out and spend $20-$30 on a rump steak or I can go buy some rump for ~$6-$8 and cook it myself. Keeping in mind that my time costs nothing. I have simply saved $12-$22 and got some enjoyment from cooking a meal.

As for breakfast, at $18.95 I would give it a miss. I believe the true cost of a cooked breakfast is ~$7.00 but would rarely purchase breakfast unless it was already included in the room rate. What would I do instead of having breakfast? Buy a barbeque chicken for ~$12.00, a loaf of bread for $1.19 and make 4-5 sandwhiches. Covers dinner, breakfast and lunch as well. Most people wouldn't bother but that is me.

... and what's wrong with people making profit? Would you rather they didn't, were closed as a result and you'd then have nowhere to stay? Clearly not everyone here thinks like a business person ....

Nothing wrong with making a profit. Big difference between 30% profit and 350% profit though.

 

[RB]

I don't disagree with your comments but as a consumer I need to make informed decisions of how to spend my money and that am I getting value for the money I spend so I do need to break things down.

e.g I am still at work, it is late, and I am going home soon and I am hungry. I can eat out and spend $20-$30 on a rump steak or I can go buy some rump for ~$6-$8 and cook it myself. Keeping in mind that my time costs nothing. I have simply saved $12-$22 and got some enjoyment from cooking a meal.

As for breakfast, at $18.95 I would give it a miss. I believe the true cost of a cooked breakfast is ~$7.00 but would rarely purchase breakfast unless it was already included in the room rate. What would I do instead of having breakfast? Buy a barbeque chicken for ~$12.00, a loaf of bread for $1.19 and make 4-5 sandwhiches. Covers dinner, breakfast and lunch as well. Most people wouldn't bother but that is me.


Nothing wrong with making a profit. Big difference between 30% profit and 350% profit though.

The only problem with your assertion is that the 350% profit is not real life (as alluded by PaulC83). Each to their own (as you say) but leave me out of 3 meals of chicken sandwiches for the day. Also for many people their time does mean money regardless of the time of day, not everyone gets a buzz out of cooking and not many get to buy bread at $1.19 a loaf! We all live in different circumstances & have different values but there is nothing to be gained by relying on & posting figures that do not reflect general circumstances-A Mackay motel charging $18.95 is not representative of Australian country motels & it would be deceptive if a prospective visitor from overseas read your post & believed it is representative of Aust "country" town motel rates in 2011.

 

[anat0l]

The only problem with your assertion is that the 350% profit is not real life

Well maybe not for a meal. But for other things it's not unheard of!

Good example in my experience: USB type A to type B cable (e.g. printer to computer). In most computer stores, it's charged at around $19.95. The cost price is typically $4.00. Profit: $15.95, or close to 400%. In saying that, it's not all "profit", as it's reduced by the other expenses, e.g. 4% for staple expenses (e.g. electricity), 20% for salesperson's commission etc.; plus that item probably pays off some of the "missing" profit on thinner margin items in the store.

 

[JohnK]

The only problem with your assertion is that the 350% profit is not real life (as alluded by PaulC83).

It may well be real life. I still believe it is wrong.

A Mackay motel charging $18.95 is not representative of Australian country motels & it would be deceptive if a prospective visitor from overseas read your post & believed it is representative of Aust "country" town motel rates in 2011.

Depends on how you look at it. I managed to get a Wotif special rate of $99/night in an Australian "country" town motel. Most motel rates are well above that special rate.

I know it is not wise to compare different countries but in my opinion accommodation, food, beverages are way overpriced in Australia.

We can keep using the excuses that we are an isolated nation, our wages are too high, we want better profits but that gets us nowhere. I am at a phase in life where I want to go everywhere but need to stretch my budget as far as possible. By avoiding overpriced goods and services I am able to achieve my goals.

 

[Keith009]

Re the brekky discussion. I'd gladly pay $18.95 for brekky myself but this would be at a nice inner city cafe. $18.95 is typically the cost of a good hot dish and coffee. But at a country motel for the usual basics - eggs, sausages etc no way. Unless there was really no alternative (haven't been to Mackay so no idea what it's like!). Work trips aside, I generally avoid hotel brekkies when I can anyway and far prefer to check out the local cafe scene.

 

[oz_mark]

I don't think I was implying it should be that way. But having a ridiculous mark-up (just because they can) is wrong.

2 Eggs = 40c
1 rasher Bacon = 50c
2 pieces Toast = 12c
1 glass orange juice = 30c
Cooking oil = 8c
Labour = $2.00 (assuming cook is paid $20/hour and spends 6 minutes making breakfast)
Overheads = $2.00
30% mark-up = $1.60

Giving a total of $7.00 for cooked breakfast. There a big difference between $7.00 and $18.95! But if everyone else is charging $18.95 and getting away with it why should I charge less?

Pricing is always a challenge - it is easy to quantify the direct costs, but the indirect costs can be much harder. I'd certainly question how the overheads here were calculated!

Having said that, I do find hotel breakfasts generally overpriced, and unless it is included I will more likely go out and find a local cafe, as they are often better value.

 

[oz_mark]

Work trips aside, I generally avoid hotel brekkies when I can anyway and far prefer to check out the local cafe scene.

I didn't realise you were awake at the times breakfast was served :mrgreen:

 

[ric_melb]

Oh; oz_mark, how you have made me laugh with your comment.

 

[JohnK]

Pricing is always a challenge - it is easy to quantify the direct costs, but the indirect costs can be much harder. I'd certainly question how the overheads here were calculated!

It was a guess. How do you apportion overheads? Is it as simple as electricity, cost of grill etc? Does anyone really do an in depth analysis of how much each breakfast costs?

All I was trying to do was work out roughly how much breakfast would cost to produce. Perhaps $7.00 is not the right number, perhaps it should be closer to $10.00 but I do know for me that $18.95 is way off the mark. Obviously different people put different value on things.

I didn't realise you were awake at the times breakfast was served :mrgreen:

LOL!

 

[Keith009]

I didn't realise you were awake at the times breakfast was served :mrgreen:

Thank goodness for all day brekkies.

 

[TonyHancock]

Does anyone really do an in depth analysis of how much each breakfast costs?

I can't believe there would be an in depth analysis of each meal, but at some point work would have to be done to establish a gross margin that would cover overhead.

Overheads can include depreciation of fixed assets, staff wages, telephones, internet, utilities, stationary, security, insurance, wastage, breakages etc etc etc. The list can go on and on.

Ultimately the price point should be set at what the market will stand whilst ensuring costs are covered.

I'd probably pay the $18.95 but that is me.

I do object a little bit to paying $350 per night for the Crowne Plaza in Perth though!!!!

 

[oz_mark]

I do object a little bit to paying $350 per night for the Crowne Plaza in Perth though!!!!

Stay on the weekend then, its much cheaper

 

[TonyHancock]

Stay on the weekend then, its much cheaper

LOL! Why didn't I think of that

 

[JohnK]

I do object a little bit to paying $350 per night for the Crowne Plaza in Perth though!!!!

Let's not get started on accommodation again.

I paid $156 for the Holiday Inn Burswood later this month. Normally I wouuld not pay that much for accommodation but I need 7 more nights for ~100,000 Priority Club bonus points.

 

[drron]

I didn't realise you were awake at the times breakfast was served :mrgreen:

Good catch.

 

[TonyHancock]

I paid $156 for the Holiday Inn Burswood later this month.

:shock:

Is that at the weekend? The robbing bar stewards want $325 for a Wednesday night.

 

[Keith009]

IMHO now is not the time to buy. The Australian property market is overpriced, and is set for a serious correction. Property is so overpriced in Australia it is ridiculous. In most (all?) other countries that have had such a bubble with house prices, their property market has crashed. Australia can't defy the trend.

More signs of an impending bust?
Australian home prices world's most over-priced: Economist survey

 

[mannej]

Let's not get started on accommodation again.

I paid $156 for the Holiday Inn Burswood later this month. Normally I wouuld not pay that much for accommodation but I need 7 more nights for ~100,000 Priority Club bonus points.

$156 isn't too bad for HI @ burswood


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[JohnK]

:shock:

Is that at the weekend? The robbing bar stewards want $325 for a Wednesday night.

Sunday night.

$156 isn't too bad for HI @ burswood

I am not saying the rate is bad. I just would not normally pay that much for accommodation. Friends and family rate was $117 but with a number of bonus points on offer I chose to pay the extra $39 for the night.

 

[drron]

And I am paying just under $A140 per night at the SGS Bangkok including a sumptuous breakfast buffet and 2 hours complimentary drinks each evening for the 2 of us.