Wednesday, November 10, 2010

Why are computer prices in the Philippines high?

Nice title, and it is really a question as this blog post will not attempt to provide a good answer.

A friend from UP and facebook asked me to write why are computer prices in the Philippines expensive, compared to neighboring countries. I cannot answer him as I do not have the data.

Then another friend in fb, Perez Bautista, provided this initial price comparison of computer parts (CPU Only):

From Phils:
Intel Motherboard DG41RG (Desktop Use)
Phil price. approx 2,950.00 Php
Hongkong price approx. 1,200.00 (Php)

Intel Core2 Quad processor 4MB Cache 1333FSB
Phil price. approx. 8,500.00 (Php)
Hongkong price approx. 5,000.00 (Php)

Power supply CoolerMaster (High-end)
Phil price. approx. 3,900.00 (Php)
Shenzhen price approx. 900.00++ (Php)

Kingston 2Gb DDR2 Memory
Phil price. approx. 1,750.00
Hongkong price approx. 500.00++

Perez added that "If you know how to assemble a PC and the right sourcing of parts,
you can actually build 2.5 more computers than buying 1 computer from the a stores here in the Philippines."

And today, I saw this comparative retail prices of IPad in several countries from The Economist magazine. HK prices are low compared to many other rich countries because HK does not slap any sales tax, wow!

Lesson 1: to keep prices competitive and affordable, have low or zero tax whenever possible. This applies to all commodities, from computers and cellular phones to food and medicines.

On another note, a friend shared with me some news he gathered why Intel pulled out of the Philippines a few years back. There were some speculations what were the reasons. My friend said that Intel management discovered huge pilferage among their employees and officers. And at that time, many computer products and parts' prices were relatively low.

Lesson 2: Do not steal. It gives you temporary benefits, but you lose out in the long term, like losing your job -- and your personal integrity and credibility.

Meanwhile, readers are welcome to provide insights and explanations to help answer the above question. Thanks.

1 comment:

John Beck said...

I've been researching computer parts and am finding that the retail for much more than what you'd pay in the USA. I'm quite frustrated about it. My question is why? Is there some kind of tariff tax on them? Most of the parts come straight from HK so why are the prices so high? If I can find the reason and do better, I'll start selling parts at a better price here in the Philippines.