Bargains Galore

It is a tough business environment in this current economic climate.  For those with money to spend, there appears to be a multitude of bargains to be had.  Many of our large retailers are owned by overseas interests particularly Australian. 

We have been pleasantly surprised when pricing furniture by the prices being offered especially on large ticket items.  Major retailers are suffering from a lack of sales, as are their suppliers.  Hire purchase invariably makes up over a third of sales, and traditionally the finance companies were providing a profitable revenue stream for the retailers.  It is now significantly harder to obtain hire purchase credit, now that many finance companies have gone into oblivion.  Because of the lack of credit, the big ticket items have now turned into apparent bargains.

Worldwide a number of leading appliance/electronics manufacturers have massive stockpiles of goods as export sales have plummeted.  Some have decided to cease manufacturing certain items.  For example most of the top end Plasma TV manufacturers have or are ceasing manufacture as they can no longer compete financially against the lower production costs of LCD screens.

Real estate sales may be receiving a stimulus by downward price adjustments.  Those with cash to invest may well find some great bargains in slow moving developments.  At times like this, the RV (rateable value) is irrelevant to the purchase price.  In regions where the RV’s were issued over the past 18 months, they may simply be a guide to the perceived values at the peak of the property market.

Amazingly it is the surviving financial institutions that appear to have the most pricing power in depressed economies world wide.  Some of these are the very same institutions that have caused problems by making unwise investment decisions.  Few businesses have the power to add additional fees, simply to increase profitability, but it appears that some of the banks here have.  Customers are now finding they are getting charged unused fees, when they do not fully utilise their credit facilities. 

We continue to hear bad economic news, and how the economic stimulus packages are too low, and may be too late.  Governments are intervening.  Australia at this time appears to be doing it perhaps harder than New Zealand economically.  The key difference is that the massive mining exports have dramatically reduced.  This will be really felt in Western Australia.  The bulk export ports associated with coal and iron in New South Wales and Queensland will really notice a slow down.

We have all been saddened by the dreadful images of the devastation and loss of life associated with the horrific bushfires in Victoria.  Rebuilding those areas will stimulate the Victorian economy in particular.  It will also probably be a positive for some New Zealand companies such as Fletcher Building who will supply goods and services to the devastated areas.

The Australian government has launched spending packages well above those announced by the New Zealand Government on a per capita basis.  Will the big spend by the Australians be a benefit to us in New Zealand? As Australia is New Zealand’s largest single export market, the chances are it will help to keep some of our exporters going.  The significant fall in our exchange rate will also make our goods more competitive in that market place. 

For those that have money available, spend some time and do some research.  You will invariably find some real value bargains.  Seldom do we see property, furniture, electronics, shares etc, all at what appears to be basement pricing at the same time.