Canadian Retailers Pricing in USD

[CorsiHockeyLeague]

This sounds like an unnecessary headache for the accountant, as much as anything... all of a sudden he has to deal with forex gains and losses based on date of sale? Locke or someone can probably chime in... seems pointless. Just charge a higher CAD price.

[mikephoen]

Originally Posted by CliffFletcher

I understand what the Sentry Box is doing. But it does irk me to see stock they bought when the CDN dollar was 0.89 to 0.99 US marked with the US price band. They're not simply passing on their increased costs at that point.

I'm not exactly sure why I'm defending a company that I directly compete with... but the last time the Canadian dollar was at even .89 cents US was mid 2013. It hasn't been 99 cents since mid 2011. No one purposely has stock since 2013, let alone 2011, still around. If they do, it's being sold at below cost to just get rid of it (or it should be). That is the definition of dead stock.

The box is huge store, but the products they sell are also quite bulky. Say they sell 5 copies of Settlers of Catan every week. That's 260 a year. Since mid 2013 that's 650 copies. Try to do the math of how much space 650 copies of Settler of Catan takes up. It would fill an average house top to bottom. And that's just one game. There are like 7 different Settlers of Catan variants alone.

Assuming they are like most game and comic retailers, they get weekly shipments. Everything on those shipments is imported, as virtually no games are made in Canada. And even if they were, they're being distributed by US distributors, so they are priced in USD anyway. So their cost on any copy of Settlers in the store is taking into account the exchange rate of at least the last month or two. And if they buy copies today at 1.48 exchange or whatever it is, and the dollar actually improves, then they will be selling them at 1.35 or whatever the price improves to, until they move through those copies and get more at the new price.

Oh, and BTW, we here at Phoenix Comics are only charging 1.35% exchange this week, despite the fact we are paying significantly more than that. Just in case anyone is curious.

[pylon]

Originally Posted by mikephoen

We have been doing this for many years. Everything we sell comes directly from the US and we pay in USD. Almost all comic stores do this. It works the other way too, when the Canadian dollar gets better we adjust accordingly.

LOL.

But of course nobody will start a thread and complain then. They will however start a thread encouraging you to stick it to the retailer some how and rip them off until they are forced to close their doors. It's kinda like the RFD (red flag deals) effect. "OMG, I found a coupon code glitch, and got my 10 free PS4's, but they charged me $20 for shipping! What a rip-off! I suggest a class action lawsuit!"

As long as it's disclosed the pricing is in US dollars, nobody should be complaining.

[BigNumbers]

Never been there, but it's obvious these SentryBox folks are pretty poor at 'teh business'....

They should know their expected average inventory costs for a coming year, and then can hedge the FX for the year for something like 75% of that expected cost. Then they can post, with relative certainty, CAD pricing... Instead of passing on the FX onto the customer... That's pretty poor business to say "hey, we suck at forecasting our inventory purchases so here, absorb our inability to do business".

I understand they are a niche company but seriously... Bush league.

[ken0042]

I can also see retailers getting complaints about constant price increases; so this is a way to show that the retailer isn't really the one raising the price; it's the effect of the dollar.

We were so close to par for so long that I often have to do a double take when looking at US dollar prices. I'll see something in a Canadian store for $80, and see it online for $49.95 US, and at first think that I'm saving by buying it from the US retailer. Then I add in exchange and see the price is almost the same; if not better due to shipping costs.

[calf]

Originally Posted by CorsiHockeyLeague

This sounds like an unnecessary headache for the accountant, as much as anything... all of a sudden he has to deal with forex gains and losses based on date of sale? Locke or someone can probably chime in... seems pointless. Just charge a higher CAD price.

Pretty much. Plus, TSB might very well have a USD account that they hold cash in to make purchases...so, having cash come in and out in USD is easier to price and manage...then your only worry is the FX rate when you take the money out of the business (or if you have to fund the account), rather dealing with the FX rate for each transaction that has or may happen.

[mikephoen]

Originally Posted by pylon

LOL.

But of course nobody will start a thread and complain then. They will however start a thread encouraging you to stick it to the retailer some how and rip them off until they are forced to close their doors. It's kinda like the RFD (red flag deals) effect. "OMG, I found a coupon code glitch, and got my 10 free PS4's, but they charged me $20 for shipping! What a rip-off! I suggest a class action lawsuit!"

As long as it's disclosed the pricing is in US dollars, nobody should be complaining.

Yeah, people hate the retailer. There is no-one hurting more from the drop in the Canadian dollar more than small business retailers who imports the vast majority of their stock. If you raise prices to match your new costs then customers rebel and refuse to pay, or even worse, grab a soapbox and try to get others to also stop buying from you also. The other option is to not raise prices, and lose what margin you already have. Then no matter how much you sell, you don't actually net any profit.

I'm not going to lie, it's scary as hell thinking the Canadian dollar could drop to .59 by the end of the year. But I'll survive, it's just another curve ball to deal with. Adapt and move on, adapt and move on.

[Enoch Root]

Originally Posted by calf

Pretty much. Plus, TSB might very well have a USD account that they hold cash in to make purchases...so, having cash come in and out in USD is easier to price and manage...then your only worry is the FX rate when you take the money out of the business (or if you have to fund the account), rather dealing with the FX rate for each transaction that has or may happen.

For any importer or exporter (or any business that has expenses in a different currency than revenues), you're going to have currency risk. And that currency risk is there every day, whether you change your prices or not. Simply having a USD bank account won't negate that.

As BigNumbers said, you can hedge your risk (and should), but that is complicated by timing and uncertainty of cash flows and isn't always as cut and dried as he/she suggests.

[PsYcNeT]

Sentry Box sucks. Everything they sell can be had on Amazon or Ebay for 30% cheaper. Brick and mortar is awful for niche products.

3.5 MM 4 for $90? #### off.

[mikephoen]

Originally Posted by BigNumbers

Never been there, but it's obvious these SentryBox folks are pretty poor at 'teh business'....

They should know their expected average inventory costs for a coming year, and then can hedge the FX for the year for something like 75% of that expected cost. Then they can post, with relative certainty, CAD pricing... Instead of passing on the FX onto the customer... That's pretty poor business to say "hey, we suck at forecasting our inventory purchases so here, absorb our inability to do business".

I understand they are a niche company but seriously... Bush league.

It's not about forecasting for the year, it's quite literally about storage. You're also forgetting to factor in the hundreds of new products that come out in a year. You sell far more of these than you do even the best perennial products, and you can't pay for these in advance. Also, in a market as niche as board games, you often can't stock up on products to that extent, because the companies making these have the same storage problems, and don't have infinite in stock at any one time. They do small printings a few times a year, because quite literally no-one in the system has enough warehouse space to hold a years worth of product at any one time.

[calf]

Originally Posted by Enoch Root

For any importer or exporter (or any business that has expenses in a different currency than revenues), you're going to have currency risk. And that currency risk is there every day, whether you change your prices or not. Simply having a USD bank account won't negate that.

As BigNumbers said, you can hedge your risk (and should), but that is complicated by timing and uncertainty of cash flows and isn't always as cut and dried as he/she suggests.

Oh, absolutely. They have to pay utilities, property taxes, employees, etc in Canadian dollars, so that risk is ever present. I'm just saying when it comes to ease of purchasing and pricing, keeping it in one currency, despite the effect on the customer, is much easier to manage day-to-day.

[temple5]

The likely reason tSB prices in USD is because of comparison shopping online.

I have never tried to buy anything there in USD, I will try that next time and see what happens.

[mikephoen]

Originally Posted by temple5

The likely reason tSB prices in USD is because of comparison shopping online.

I have never tried to buy anything there in USD, I will try that next time and see what happens.

I can't comment on their practices, but here we take USD at the same exchange rate that we charge. If anyone wants to sell me USD at 35% exchange today, I'll take all of it BTW.

[Finger Cookin]

Originally Posted by mikephoen

I'm not going to lie, it's scary as hell thinking the Canadian dollar could drop to .59 by the end of the year. But I'll survive, it's just another curve ball to deal with. Adapt and move on, adapt and move on.

I'm not looking forward to picking up monthly issues of my comics at $6.75-$8.50 each when that happens. But so it goes.

[mikephoen]

Originally Posted by Finger Cookin

I'm not looking forward to picking up monthly issues of my comics at $6.75-$8.50 each when that happens. But so it goes.

When not responding to this thread, I've spent my morning slashing future orders, as I try to predict which titles people are most likely to drop as the prices go higher and higher...

[Krovikan]

As a customer my view is Sentry Box is dirty when it comes to their prices when the dollar was at or above parity a lot of their items started being listed in Canadian dollars, now that we are back below parity most of their stock is listed with US prices. Plus their customer service on their main counter sucks, so their really isn't really a reason for me to purchase at Sentry Box.

If you are looking for gaming stores, here are the three I visit:
- Imaginary Wars, SW (Good stock, smaller selection, amazing service)
- Revolution, NW (Good Stock, little room to walk around though, good service)
- Myth Games, NE (Pen and Paper RPG is hit or miss, Service is good now since owner stopped manning the counter)

[CliffFletcher]

Originally Posted by mikephoen

... but the last time the Canadian dollar was at even .89 cents US was mid 2013. It hasn't been 99 cents since mid 2011. No one purposely has stock since 2013, let alone 2011, still around. If they do, it's being sold at below cost to just get rid of it (or it should be). That is the definition of dead stock.

Then you don't know the Box very well. Gord has tens of thousands of items of inventory that have been on his shelves for more than 5 years, and many thousands that have been there for more than 10 years. Take a look at the wargame or RPG section sometime. All sorts of stuff from the 90s still in shrink. He doesn't care if it's dead stock because 1) he owns the building, 2) it's massive, and 3) he figures someone, someday will probably buy it.

Originally Posted by BigNumbers

Never been there, but it's obvious these SentryBox folks are pretty poor at 'teh business'....

The store started over 30 years ago in a strip mall behind a gas station in Altodore, and is now the largest store of its kind in North America, and probably the world. In a retail sector where stores fail at an astonishing rate. The owner must be doing something right.

Originally Posted by PsYcNeT

Sentry Box sucks. Everything they sell can be had on Amazon or Ebay for 30% cheaper. Brick and mortar is awful for niche products.

Not if those niche products have lots of customers who need people to play with and a place to play. On a typical Saturday there are close to 100 people gaming at the Sentry Box. Again, they gotta be doing something right.

Calgary has a geek and gaming scene much larger than a city of this population should warrant. There are only a handful of cities in North America that can support a tabletop gaming convention with 400 attendees. Part of that is due to the money in Calgary. But a big part of it is the Sentry Box.

[Finger Cookin]

Originally Posted by mikephoen

When not responding to this thread, I've spent my morning slashing future orders, as I try to predict which titles people are most likely to drop as the prices go higher and higher...

I'm also wondering how the rate might impact trade waiters who may not have picked up a volume in 6-9 months. When the last Image trade they got was $14.99 and the next one collecting the same number of issues might be $25 and up.

I nominate that you slash orders on announced variants by TBA with no preview art.

[mikephoen]

Originally Posted by CliffFletcher

Then you don't know the Box very well. Gord has tens of thousands of items of inventory that have been on his shelves for more than 5 years, and many thousands that have been there for more than 10 years. Take a look at the wargame or RPG section sometime. All sorts of stuff from the 90s still in shrink. He doesn't care if it's dead stock because 1) he owns the building, 2) it's massive, and 3) he figures someone, someday will probably buy it.



The store started over 30 years ago in a strip mall behind a gas station in Altodore, and is now the largest store of its kind in North America, and probably the world. In a retail sector where stores fail at an astonishing rate. The owner must be doing something right.



Not if those niche products have lots of customers who need people to play with and a place to play. On a typical Saturday there are close to 100 people gaming at the Sentry Box. Again, they gotta be doing something right.

Calgary has a geek and gaming scene much larger than a city of this population should warrant. There are only a handful of cities in North America that can support a tabletop gaming convention with 400 attendees. Part of that is due to the money in Calgary. But a big part of it is the Sentry Box.

Haha, you missed the part where I subtly said in brackets: "or it should be". I agree the Box does some weird things that I wouldn't do as a retailer. And that Wargame and RPG stock is beyond dead. But I was talking more about the product that actually sells, not the stuff that Gord collects and stores in his retail location for his own amusement.

[mikephoen]

Originally Posted by Finger Cookin

I'm also wondering how the rate might impact trade waiters who may not have picked up a volume in 6-9 months. When the last Image trade they got was $14.99 and the next one collecting the same number of issues might be $25 and up.

I nominate that you slash orders on announced variants by TBA with no preview art.

Yeah, they don't like to make my job easy, that's for sure! At least that beats the Marvel solicitations that are 'Writer: TBA, Artist: TBA, Content: CLASSIFIED!'. How many of that should I order!