QUOTE(MR.Jellyfish @ Sep 8 2015, 09:01 PM)
some of china imports have over 1000% margin so absorbing the 30% increase is negligible.
Typical narrow minded view. Typical of BNTroopers.
At least credit to you, you put in your KEYWORD, "SOME". As in a small portion if any.
You think ALL our imports come from China ah?
I import directly from China also. What is the 1000% margin you speak of? Trying to pull wool over the sheep again?
China imports mostly FOB (unless directly negotiated). You no need pay for insurance/Freight which is in USD?
Then the additional costs from currency exchange are all compounded by GST, which is based on CIF prices in local currency after conversion.
Our factory equipment are all in USD and EURO. Including contract maintenance, parts and support.
Funny, you talk like you know. If you are directly affected, you will know what sort of impact this is.
Other things you probably didn't think about;
1) Duties and taxes (other than GST)
2) Cash flow
3) Financing costs increase
4) GST refund (or lack thereoff)
5) Production wastages
All these affect cost beyond just material costs....and to make it worst, these are compounded costs. You increase base cost, everything goes up more than the initial costs.
I know some of my clients and associates have seen revenue drop by 40-50% due to reduced demand. Couple with a 40% cost hike, many will find it difficult to survive. And pray tell what happens to the staff if the company decides to shutter up?This post has been edited by jaycee1: Sep 10 2015, 02:43 PM