As the Canadian dollar, otherwise known as the Loonie) hits new highs everyday, it becomes imperative for both consumers and businesses to begin questioning the costs of items.
Simply put, over the last few weeks, just as a consumer, I've managed to buy "right" and questioned some other ludicrously large differentials.
Simply put, over the last few weeks, just as a consumer, I've managed to buy "right" and questioned some other ludicrously large differentials.
- Check what the currency conversion is on credit cards. Prior to buying something in US Dollars, I called both Visa and American Express. Visa's conversion earlier last week was $1.005, while American Express was languishing in the .97 area. So of course I bought the item with my Visa (although let's face it they are also making money on the soaring Loonie).
- If you've gotten a renewal notice from a US magazine publication, check their website subscription rates, and then question the rate you are being charges. I subscribe to Business Week, and received a renewal notice that said "Best Rate" which stated it would cost me $63.95 CDN to renew for the next year. I checked their website and in US dollars the magazine was significantly cheaper. So I emailed them and asked them their rationale and then requested their best rate in US Dollars. Lo and behold, my cost to subscribe to Business Week for a year is now $ 45.97 US...what a deal!
- I went to purchase something online which is manufactured in Cambridge. Online you can only buy through their PayPal alliance. So when I put in my order and then was asked for final review....are you ready?.....the conversion rate used by PayPal for Canadian to US Dollars was .94!!! The company stated well this was what PayPal would get from American Express...so that is why there is the difference. If you look at point number 1 above it is apparent that PayPal is also taking some additional profit on the conversion.
It is important for corporations as well to look at their contracts for products and services from US or foreign firms. If not already paying in US dollars, they may have inserted an uplift based on currency conversion and risk. Good negotiators usually put a caveat into the contract that allows renegotiation based on a 5% currency fluctuation. Unfortunately, many negotiators aren't that savvy.
Look through all your contracts and start asking the questions and forcing the issue. Otherwise, you will be helping other firms get rich, while your profits fall.
And forget the old adage -- "good things come to those who wait". As a consumer -- go out there and push the envelope and start asking the questions....retailers do respond to customer demands.....eventually....And don't forget to tell Santa to buy in US dollars.
Look through all your contracts and start asking the questions and forcing the issue. Otherwise, you will be helping other firms get rich, while your profits fall.
And forget the old adage -- "good things come to those who wait". As a consumer -- go out there and push the envelope and start asking the questions....retailers do respond to customer demands.....eventually....And don't forget to tell Santa to buy in US dollars.
1 comment:
"Good negotiators usually put a caveat into the contract that allows renegotiation based on a 5% currency fluctuation. Unfortunately, many negotiators aren't that savvy."
It's too bad most negotiators aren't that savvy because it's the consumers who tend to pay for the oversight - like right now in Canada.
I have always hated looking at the cover of a book and seeing the American price and the Canadian price. I'm old enough to remember the last time it was the other way around.
Recently I complained about paying the higher 'Canadian price' for a novel but I was told that since the retailer had paid a higher price, I also had to pay a higher price.
Much like shoplifting, it somehow became my fault when the vendor screwed up and as usual, it was somehow my responsibility to pay for it. This particular vendor was actually irritated I had even mentioned the matter.
Apparently prices can't be quickly changed - unless they're going the other direction.
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