Prices

[jukung11]

There have been a few discussions recently on the topic of disclosure of prices. Rather than derail the other threads, I decided to start a new one.

One reason people do not disclose prices is because they are selling a story, not as much the product. I am a fan of a podcast called Planet Money. They had a great story about how and why Jewelers (and many other goods) hide the price. The price is to sell you the story. That is the premium for the seller. You could apply this to many other premium goods including cheeses that have to be made in a certain location in the world.
http://www.npr.org/sections/money/2014/09/22/349873785/why-jewelry-stores-hide-the-price-tags

Also there is another reason of trying to get the maximum price of what you think each individual will pay. There is a great breakdown of the history of this here:
http://www.npr.org/sections/money/2...sode-633-the-birth-and-death-of-the-price-tag
A basic premise of the story is how the history of prices pre-industrial revolution were based on the maximum amount that the seller perceived of the buyers demand.
It is interesting how culturally westerners hold a price. Post industrialization westerners discovered it was more economically efficient in most transactions to have a standard price. I have lamented about the frustrations of the cultural differences in transactions in Indonesia when sellers charge a bule price or simply state something very high expecting it to be negotiated down. Occasionally when it is a small amount, I will just pay more. My time is more valuable to me than the negotiation. Many times the cultural difference between perceptions of price will have me just walk away from the transaction resulting in an economic loss for both parties (wasted time and no exchange of money).

This topic has been on my mind for a couple years so I thought I would write it down and listen to what others have to say on it.
I have a few questions I would enjoy peoples opinions on:

Do you think standardized pricing will culturally develop in Indonesia as the economy and wages develop?
Do you think that the cultural value of bargaining could a very minor impediment to economic development?
Will the widespread use of smartphones in Indonesia have them skip standardized pricing for a more adaptive model?

Any other thoughts I would appreciate.

 

[waarmstrong]

I agree that merchants hiding the price are selling a story; that is the essence of marketing a brand. Shifting the emphasis from comparisons based on quality, durability and other indices of value, to brand identity based upon a contrivance, a story, is what you seem to be advocating. Me, I want to purchase quality products at the best price that transparent competition can yield. Stories are not on my shopping list.

 

[Smallworld]

.....
It is interesting how culturally westerners hold a price. Post industrialization westerners discovered it was more economically efficient in most transactions to have a standard price. I have lamented about the frustrations of the cultural differences in transactions in Indonesia when sellers charge a bule price or simply state something very high expecting it to be negotiated down. Occasionally when it is a small amount, I will just pay more. My time is more valuable to me than the negotiation. Many times the cultural difference between perceptions of price will have me just walk away from the transaction resulting in an economic loss for both parties (wasted time and no exchange of money).

This topic has been on my mind for a couple years so I thought I would write it down and listen to what others have to say on it.
I have a few questions I would enjoy peoples opinions on:

Do you think standardized pricing will culturally develop in Indonesia as the economy and wages develop?
Do you think that the cultural value of bargaining could a very minor impediment to economic development?
Will the widespread use of smartphones in Indonesia have them skip standardized pricing for a more adaptive model?

Any other thoughts I would appreciate.

Wasted time maybe yes .... but more important you learnt something:

- seller is not wiling to negotiate lower price, the character and type of the seller
- you learnt where is his business located, what does he sell, volume he is selling ect.
- confirm prices ranges (even the absurd ones) - you can categorise at least which seller is more greedy / crazy

Always ask, ask and again ask ..... then search until you find YOUR SELLER. This is the most frustrating part but highly rewarding once you get a grip of it.

Do you think standardized pricing will culturally develop in Indonesia as the economy and wages develop?
Do you think that the cultural value of bargaining could a very minor impediment to economic development?
Will the widespread use of smartphones in Indonesia have them skip standardized pricing for a more adaptive model?

1. It will but it will take long time. Places like car boot sales, flea markets will preserve the "nature of negotiation prices" as it is integral part of any market since ancient times.

3. Smartphones will give Indonesian people better way to find "someone" cheaper or to quickly check price / search for information on product prices. It will not affect in any way the way how fast businesses will start to display their price tags.

2. In my opinion the culture of negotiation on prices has got a major influence on any economy. This is the basic principle on how economy is based and how businesses work. Eg. if someone is willing to sell you bank for 1 billion GBP will you buy it for the ASKING price or you will try to negotiate to get it lower? Do you think they will send you bill to sign straight away or is there some negotiation process?

No prices has got this magical thing you know.... you never know if some items they sell will be much cheaper than their competitors some will not. You then know what to buy and from who and for how much.

 

[rabbit_39]

Sure, sell a story. But don't be disappointed if you're selling crap stories and you're given crap over it.

 

[jstar]

.
I realize this is a bit of thin ice, but I'll write it down anyway:
Many years ago I had a colleague from Iran. When we travelled together, and went shopping in our spare time, he always haggled. And he stated: "I have always gotten any discount or bonus when I bought something.". He was probably right; I saw him in action in a some stores in London and buying a suit (free tie, free shirt, ...).

And even in western countries you can negotiate prices, especially if you buy larger amounts etc. But to do that in a regular shop, is definitely frowned upon. (Factory outlets and antique stores and car dealerships are the big exceptions.) But he didn't care. And I am very close to some people who -when they go shopping- ask as first question: "Ada discount, mbak?".

So the global Asian attitude is different, look at the sales models via FB/Instagram here where they practically never publish prices. (Even the professionals.) It could have to do with avoiding giving insight to the competition, or just getting the most out of every potential customer (depending on their negotiating skills). But if someone already knows everyone will haggle, and a price is nothing more than a starting point, why publish it?

 

[fastpitch17]

The nature of negotiated sales will be around for a long long time. This will be especially true when it comes to Expats buying outside the major brick and mortar stores and set price internet sales. Local merchants seem to raise the price immediately upon learning an Expat is interested. Even with a pain in the ass negotiation you will still have to pay more if you want it. Merchants are not shy about telling you that "hey, you are a Bule, you can pay more." I have seen it first hand. For my wife and I, we tell them what we feel is fair and if we can't get that, we walk away. It still amazes me how they seem to be happy making no sale over a sale they were hoping for extra from. When I say fair, I am not referring to some low ball steal. When it comes to things like furniture and larger expensive items, we do our homework first. My wife has been quoted prices and she agreed to them and as soon as they seen me they immediately raised their price because, oh a Bule, you have lots of money so you can pay me more.

Pricing has changed for the better only in regards to land based bigger stores and the internet markets and their you should probably stick with the bigger outlets since there still seems to be problems in the smaller ones not delivering the product you paid for if any product what so ever.

 

[Smallworld]

...Merchants are not shy about telling you that "hey, you are a Bule, you can pay more." .....

When it comes to things like furniture and larger expensive items, we do our homework first. ....

In the first case I try to "prove them" I am not an ordinary bule. I know the language, I know a bit how to bargain, what I want to buy and what the price is/should be (according to my research). I usually chose my seller by how nice the negotiation / conversation is going vs. price. I won't mind to pay a bit more to the seller with whom doing business is a pleasure.

Second case I send my wife to ask first for the price - asking price - it means it cannot go up by any means. Period. If it does it shows the seller is not mature - someone who is changing their mind every 5 sec (about price) is not worth to do business / proceed with sales. It applies to any kind of sale!

 

[fastpitch17]

Second case I send my wife to ask first for the price - asking price - it means it cannot go up by any means. Period. If it does it shows the seller is not mature - someone who is changing their mind every 5 sec (about price) is not worth to do business / proceed with sales. It applies to any kind of sale!

I have had my wife go in and get a price on furniture. She was quoted 2.5 juta for an item. I came by with her the next day and as soon as the lady seen me she said to my wife, you are married to Bule, you have lots of money, price is now 4.5 juta because you can pay more. We left.

 

[Puspawarna]

Thank you for starting this thread, jukung11. I think it is healthy to discuss this.

There are really two things going on here - one is the wider question of cultural differences in price specification practices, and one is a much narrower but not completely unrelated question of what forum policy is in regard to our classified advertising section. I'll speak to the second.

As a poster, I personally have no problem with requiring that advertisers publicly post their prices, and I understand why people are skeptical when they aren't. As a mod, I'm willing to listen to various points of view and try to come up with a rule that is reasonable, reflects thoughtful discussion with the team's various viewpoints, and transparently leaves us with a healthy, functioning forum.

But I gotta say, it seems as if our poor advertisers are damned if they do and damned if they don't.

If they DO post prices, history from the old forum suggests that someone will respond with "what? You want Rp 100,000 per meter for that cloth made of Javanese unicorn hair? Bah! I can get it for half that, and the cloth *I* buy is made from only pink unicorns that were raised on mead made from the tears of baby pandas!" Okay, I'm exaggerating for effect. But anyone who has been reading the forums thoroughly for a while will know that pouncing on prices that are perceived - rightly or wrongly - to be too high is a real thing.

If they DON'T post prices - well, our cheese fiasco shows what can happen then.

I'd like to paraphrase the Rodney King question: why can't we all just get along (in the classifieds)? Take honest fights to threads on politics/current events, and take bickering to the Cage. At the same time, let's make this place at least somewhat attractive for advertisers by not scaring them away.

Got a question for an advertiser? Ask it - just do it politely. One defense of challenging advertisers is that it is for the benefit of future readers. Sure, I'll buy that. If that's the case, won't civil discourse, in which advertisers are encouraged to answer because they feel like they are being treated with respect, be the best of all?

 

[sumyunggai]

I find strange some of the pricing.

Example:

sachet of shampoo (5ml) - 500rp
bottle of shampoo (170ml) - 18,000

sachet is cheaper

Or

Small packet of Sampoerna cigarettes (12 sticks) - 13,000rp
Large packet (16 sticks) - 21,000rp

Small packet is cheaper

In the west we expect a bulk discount...

 

[William King]

It's often bule price or screw the buyer for as much as they can. And like it or not that it's part of racism.

 

[jstar]

I find strange some of the pricing.

Small packet is cheaper

In the west we expect a bulk discount...

https://forum.expatindo.org/showthread.php?430-Indosyncrasies&p=8521&viewfull=1#post8521



Of course the whole pricing thing is obviously dompet related but that again is based on racial profiling and also location determination. To generalize somewhat: In Bali for instance, a local will get the lowest price (sometimes there's even Desa differentiation), then an Indonesian, then a Chinese Indonesian, then an Asian, and then a Bule.

Many westerners who have been in Italy or Mexico or so think they have a grasp of bargaining but they will always pay 'too much' anyway. Of course that is relative; it can be a win/win. I just make sure I have a number in my head. But better is to send your spouse in after checking out the product.

If my wife wants to buy a bag for instance, made from leather and batik, as a present for someone in Europe, she will often get it via FB/Instagram. I am always amazed at the process; hundreds of messages back and forth with the seller, hours and hours of 'chat' and negotiations. Not my cup of tea.

 

[Euc-]

I've done the Bule vs Local pricing test on various occasions, something like fastpitch17 I have never seen or experienced.

I remember I was looking for a new iPhone when I was in Nagoya Batam, I asked a colleague for assistance, told her exactly what I was looking for before we reached the mall and we went in through separate entrances. After a good 30 minutes of shopping around I had managed to haggle the cheapest price by almost 1 million for the same product. I then send her to the store I got the best price from, which she skipped initially, and even there she was still quoted a good 500rb more then me.

My friend negotiated in Indonesian, I did in Indonesian and Hokkien.

Yes, some people will try to get more money from you based on your looks (Pak Dobil babi guling in Bali/Nusa Dua is a prime example), but if you know the price the locals are paying and call them out on it you'll get it for the same price. In the end, as long as both of you are happy with the price you're paying, who cares if a few bucks were made?

 

[jstar]

My friend negotiated in Indonesian, I did in Indonesian and Hokkien.

That says a lot though. A brother in law from Medan also gets very good deals from many of the toko owners who are ...... you guessed it.

 

[fastpitch17]

I went to an electric toko today to pick up some lights. My wife previously bought the same lights in that store twice. Once only a month ago. Today she went in and waited right outside. She went up to the owner who she normally doesn't deal with and asked for three of the lights. He tells her 20,000 over what she has been buying them for from the girl standing right next to him but not looking up at her. She, who doesn't look Indonesia explains that she has been buying these lights her for less. She tells him what she has been paying. He says, OK, and takes off 5,000. She looks right at him and accuses him of charging Bule prices. Oh, no, he says, I wouldn't do that. She told him, I know because I won't buy them here any longer and walked out.

 

[jukung11]

One cultural value I was referring to the constant need to bargain over everything no matter how large or small. No consistency in pricing. Yes, in the west, there are still big ticket items which can and do require some negotiation such as furniture and
cars and many other commission based sales items. But the negotiations of price has an economic cost on both buyers and sellers. Time, trust and training in employees, information costs, etc. Could you imagine if you had to do this every time you walked into an Indomart? Yes, I might be able to get a lower price for water from a street vendor, but most times I would prefer to get it from an Indomart instead of having to get quoted more then spend time haggling. Is it really economically efficient for both parties to have to bargain for every light bulb?

My friend negotiated in Indonesian, I did in Indonesian and Hokkien.

Explains a lot.

It still amazes me how they seem to be happy making no sale over a sale they were hoping for extra from.

This is a cultural conflict that I am referring to. I am happy to walk away from transactions because of my own cultural understandings of fairness and price and they are satisfied to do the same. Economic failure on both parts. As a small example, yes I could easily afford an extra 5k idr for sate, but when the person in front of me and behind me is quoted less, I walk away from the transaction. Bickering over 5k idr is not worth it to me, and the seller is happy to have me walk away rather than not get a person like me to pay more.

Little conflicts like these help me to notice and understand the value in some of the smallest things that I took for granted, like a price tag.

 

[Euc-]

That says a lot though. A brother in law from Medan also gets very good deals from many of the toko owners who are ...... you guessed it.

Mind you I'm 100% white, not a drop of Chinese blood in me. So, for the sake of this particular argument it shouldn't matter that much should it?

 

[Banana72]

Mind you I'm 100% white, not a drop of Chinese blood in me. So, for the sake of this particular argument it shouldn't matter that much should it?

In your case, I think the language helped you more than the looks. However, you being a non-Chinese who speak the language, had even a greater positive effect in my opinion.

I don't know how good your Hokkianese is, but a caucasian speaking say, average Hokkianese (not saying your Hokkianese is average btw) is amazing in Chinese people's eyes, vs a non-caucasian speaking average/so-so Chinese/Mandarin, might get some negative comments instead ("You're Chinese, how come your pronunciation is bad?" "You need to speak better, etc". "You're Chinese, how come you can't speak the language?" etc). I don't know if it would translate to better/worse pricing though.

 

[atlantis]

I've done the Bule vs Local pricing test on various occasions, something like fastpitch17 I have never seen or experienced.

Mind you I'm 100% white, not a drop of Chinese blood in me. So, for the sake of this particular argument it shouldn't matter that much should it?

I totally agree with Euc-'s posts in this thread. This whole thing about "bule price" and that we would be eternal victims is just rubbish, sorry to say. All depends on your ability to establish a conducive relation with a seller, whatever color of skin you have.

For the record, I trade on a daily basis a bunch of commodities which are for the most part resold for a profit to... Indonesian. In the past 3 years in our region we have taken important market share in a market which was previously controlled by Indonesian traders, pribumi or of chinese descent. If we have done so it's just because we have been more careful and aggressive in our purchase, allowing us to be the most competitive while remaining economically very profitable.

I am buying commodities from various region including Jawa Timur, Jawa Tengah, DKI Jakarta, Maluku, Sulawesi Tengah, Gorontalo and of course Sulawesi Utara and from a large spectrum of sellers.

In the past I have also traded a lot with Bali and Jawa tengah, for other types of goods than what we deal with now, sending on average about 20 containers of goods to Europe and here again, I have never experienced discrimination on the final bill. Even comparing the price Indonesian sourcing the same products than us were paying I believe we always had a very fair deal.

At the moment, about 90% of our total purchases are done by me, a good old bule with white skin and tattoos. And definitively 100% of it when it comes to commodities where a negotiation may be involved. As much as my Indonesian wife is skilled for many things, when it comes to price discussion she has rarely approached the result I got, even (and perhaps should I say "especially") with fellow Minahasan.

I really don't give a flying rat's ass if a good I want comes with a price tag or not. I even prefer that it doesn't have to be honest.

Do I have a price list of the items we trade? Not really. Or to be more exact we have several of them. You wouldn't get the same price from us if you want 1 fish or 1 ton of it, if you intend to pay me cash or if you need a special T.O.P, if this T.O.P is gonna be 7 days or 90 days (our limit), if you intend to come and buy just today or if your needs are regular, if you are interested by the whole range of products we propose or if you are just willing to pick the rare, hard to find anywhere else items in our list of products, etc. In a word, I want to hear from you and this is what will tailor the price you get. This, and of course how skilled you are in establishing a conducive trading relation with us.

 

[atlantis]

In your case, I think the language helped you more than the looks. However, you being a non-Chinese who speak the language, had even a greater positive effect in my opinion.

I don't know how good your Hokkianese is, but a caucasian speaking say, average Hokkianese (not saying your Hokkianese is average btw) is amazing in Chinese people's eyes, vs a non-caucasian speaking average/so-so Chinese/Mandarin, might get some negative comments instead ("You're Chinese, how come your pronunciation is bad?" "You need to speak better, etc". "You're Chinese, how come you can't speak the language?" etc). I don't know if it would translate to better/worse pricing though.

Exactly. As per my previous post, it all depends on how skilled one is in establishing a conducive trading relation with a seller. Use your skills, be they the knowledge of a language, humor, ruse, patience, tenacity...etc, and as importantly know what you are talking about and look for.

I've been trading with China for years, again sending containers of goods to Europe from there, without speaking much Mandarin apart mastering the numbers and a few basic polite words, using translators only to explain technicalities about what I needed to be produced. Many of my contacts knew about as much English as I knew Mandarin.