Consumers the winner in competitive electronics market

By IRENE CHAPPLE


Cut-price retailers are jockeying for position in the competitive electronics market as the strong kiwi drives prices down.

Consumers are the winners as gains in the exchange rate are passed on to imported goods, some of which are selling for less than half last year's price.

The strong dollar and increased efficiencies in the electronics market have produced what is perhaps the season's best deal: DVD players for about $90.

Last week, The Warehouse dropped its Transonic brand DVD player from $99 to $89.99 - last year a similar product was $199.99.

According to The Warehouse's David Wilson "several thousands" have sold and around 4000 remain in stores across New Zealand.

The price, he says, is "rock bottom" and unlikely to drop.

A Sanyo 14-inch television is selling for $189, while a year ago a similar product would have cost $260.

The Warehouse also says it is the price leader for X-Box and Playstations, neither of which it stocked last year.

Missing out on the games console market was blamed for last year's poor Christmas season and now The Warehouse is a strong competitor in the market.

The Warehouse says it is offering the cheapest prices in town: $316 for X-Box and $345 for Playstation 2.

Meanwhile, across town at K-Mart, Magnavox DVDs are selling for $96, down from $199 at this time last year.

These deals are the result of a ferocious price war between the two. Asked if the company would try to undercut The Warehouse further, K-Mart's Craig McKeown said "life can get pretty interesting in that world ... " However, he also said K-Mart believed its product was of better quality and that would be taken into account with the pricing.

McKeown said there were several factors influencing the price drive downwards, including the cheaper production of electronics and the competitive pressure to pass savings from the high dollar on to the consumer.

Wilson said the company had always been clear it would reinvest the savings into prices and that competitive attitude was forcing competitors to follow suit.