The Highs And Lows Of Online Shopping

Saving and Making Money

18 January 2008 | 0 Comments

Shopping around online is convenient and saves a fortune, but this Fool reveals one downside of buying from foreign websites.

If the UK economy relied on my spending habits, then we'd all be up the proverbial creek without a paddle. Indeed, I shop so infrequently and spend so little on consumer goods that I'm hardly much of a `consumer' at all. This is partly because I can get by perfectly well without the latest `must have' gadgets and fashions, and partly because I hate trawling around high streets and shopping centres. However, I am partial to one specific type of `retail therapy' and that is shopping around online. Specifically, when I want to buy a particular item, I always use price-comparison websites to track down deep discounts. After all, why pay the full recommended retail price (RRP) when discounts of 50%+ can be found online in minutes? As well as using well-known `shopbots' such as Google Product Search, Kelkoo, Pricerunner and Shopping, I also use specialised shopbots to search for bargain books, CDs, DVDs and so on. I list several of my favourite price-comparison sites in Specs And Drugs And Rock 'N' Roll, Save 50% On DVDs and Buying Bargain Books. For example, let's see how much you could save by shopping around for three best-selling items. Take a look at these savings: ItemRRP (£)Lowest PriceFound(£)*Saving (£)Saving (%)A Thousand Splendid Suns by Khaled Hosseini £11.99 £5.99 £6.00 50% The Simpsons Movie DVD** £19.99 £7.99 £12.00 60% FIFA 08 for PlayStation 2 £39.99 £17.93 £22.06 55% * Prices include delivery **If you don't have a multi-region DVD player, then be sure to buy Region 2 (European) discs, otherwise they won't work. As you can see, a quick search can throw up massive savings on recommended retail prices, which explains the strong growth in online shopping. However, there is a downside to the ease with which we can find worldwide bargains, as I discovered at Christmas. I was shopping around for some beauty products for my wife when I found the excellent StrawberryNET website. This Hong Kong-based retailer charges low prices for cosmetics, make-up, perfume and skincare products. Reassured by masses of positive feedback from delighted British customers of StrawberryNET, I place an order for two Clinique skincare products, costing £17 and £18 respectively. So, with free delivery to the UK, the total came to £35. That's a saving of more than £15 on UK RRPs. So far, so good. What's more, I knew that value added tax (VAT) and sometimes duty is due on goods imported into the UK with a value of more than £18. Thus, I should have placed two separate orders in order to avoid extra charges. However, I was interested to see what would happen if I didn't split my order into deliveries of £18 or less, so I let it proceed as a single item. Predictably, HM Customs spotted that VAT was due on my £35, so it demanded the usual 17.5%, which came to £6.12. Alas, I was shocked to see that the Royal Mail had added on an `international handling fee' of £8. Hence, these additional charges totalled £14.12, which means that my order cost a total of £49.12. This added over two-fifths (40%) to its cost, almost cancelling out the discount gained. More fool me for allowing HM Customs and Royal Mail to plunder my wallet! So, if you plan to buy goods from international or overseas websites, try to keep the value of each separate order below £18. By doing this, you avoid paying sky-high levies which can be high enough to wipe out any savings. In other words, please learn from my silly mistake. Finally, all may not be lost, as StrawberryNET does offer to refund customs charges as a gesture of goodwill. This is not strict company policy and is only discretionary, but I'll give it a try. A cheque for £14.12 would be a happy ending! More: Earn as you spend with a cashback credit card | Current Discounts And Deals #15 | Earn Cashback On Everything

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