Web shows high costs of hi-tech

The price difference soon adds up say researchers

Consumers could be paying almost double what they need to for their hi-tech toys, an investigation has found.

The research, carried out by reporters at PC Pro magazine, found that a basket of gadgets and software cost £3,500 from UK shops, but was £1,000 less when bought directly from US websites.

The saving varies by gadget but in many cases PC Pro found that US prices were half those in the UK.

Software, laptops and portable music players were all cheaper overseas.

Cost cutting

Following the investigation the reporters branded the UK a "treasure island" for the computer industry because so many people were paying more than they needed to for popular electronic gadgets and software.

"Some manufacturers fob us off with stories of localisation costs, but the price discrepancies between the US and the UK are simply too big to justify," said Tim Danton, PC Pro editor.

The price differences could be frustrating, he said, because it was so easy to look on US websites and see what Americans were paying for the same goods.

For its investigation PC Pro priced a basket of goods, including hardware and software, that might be sought by someone setting up their own business.

Buying the goods from US websites rather than UK high-street stores could mean a saving of more than £1,000.

WEB SHOPPING TIPS Use US websites that ship direct to the UK Get details of shipping costs before ordering Find out import duty on what you are buying Check warranties on the goods Research the returns policy just in case

For example, a copy of Microsoft Office 2003 is £362 from stores in the UK. By contrast it is on sale in some US web shops for as little as £211. Gadgets such as digital cameras were, on average, 40% cheaper in the US.

"If you know where to place your order and your rights as an international customer, you're in a great position to save a fortune," said Mr Danton.

Many US web retailers will supply goods direct to customers in Britain.

The main advice for those shopping on US websites is to check details of shipping and import duties before placing any order. Both can wipe out any savings that would be made on the basic price of software and consumer electronics.

Import duties can be tricky to negotiate. Digital still cameras are duty free but monitors that can handle digital video incur a 14% rate.

PC Pro also recommended finding out about the warranties associated with products and the returns policy.

James Roper, chief executive of the Interactive Media in Retail Group (IMRG) which represents web retailers, welcomed the fact that the net helped people get a better deal.

The net was both a leveller and enabler, he said, and it was up to retailers to convince customers to buy from them.

Nowhere was competition more intense than on consumer electronics, said Mr Roper.

Figures from the IMRG show that web sales of electrical goods grew five fold in the three years to Christmas 2004.

Web sales now make-up 20% of all retail sales and influence a further 40%, said the IMRG.