Lower MSRPs coming to Canada?

[eric_legare 0]

Canada's Finance Minister announced today a cut in tariffs for hockey equipment in the 2013 federal budget. The 18% importation tax will be waived in order for Canadian manufacturers/retailers to pass these savings to consumers.

http://www.thestar.com/news/canada/federalbudget/2013/03/21/federal_budget_2013_conservatives_hope_tariff_cuts_translate_to_lower_prices_for_sports_equipment_and_baby_clothing.html

[wrangler 157]

Effective 4/1/13. It'll be interesting to see if, how, and when this affects retail pricing.

http://business.financialpost.com/2013/03/21/canada-budget-hockey-gear/

[AIREAYE 248]

Canadian fiscal policy

In addition to helping retailers with cross-border shopping and shoppers, I would imagine that the effects will be felt among smaller gear companies based here in Canada as well. For the remaining few who still produce in North America and might be on-the-fence about moving production overseas, this might just push them over. For the remaining 5% of all hockey gear that is still produced in Canada that is.

If hockey associations inform parents about the numbers, mainly that, on average, they will not longer be paying $200 more for gear than a kid in the states, that could definitely be a bonus.

Assuming manufacturers/retailers pass on these tax savings to consumers that is. Conveniently enough, I have a chance to speak with Gerald Woodman, director of sporting goods channel for adidas, hopefully I'll be able to ask this question.

[t6lock 24]

i hate having to buy stuff from the states, hopefully this will help

[Chadd 916]

Effective 4/1/13. It'll be interesting to see if, how, and when this affects retail pricing.

http://business.financialpost.com/2013/03/21/canada-budget-hockey-gear/

Pricing has already been established for this product year. I can't imagine the manufacturers are going to issue a credit to credit all of the dealers. I would expect them to pocket the difference and adjust pricing on any new orders for product arriving after that date.

[wrangler 157]

That would surprise me, but I've been surprised before.

[RadioGaGa 162]

From a retailers stand point...Why would they drop prices....?? We're used to paying what we pay. If the tariff goes down 18% and the prices goes up 18%, we don't know the difference. I know If not for this site, I would not be following the Federal budget process and it's affect on hockey gear.

"Pass the savings on the to comsumer" is an advertsiing cliche that means nothing.

"Jack up the price and pocket the difference" is more likely how it will work.

I wanna see the guy who walks into Pro Hockey Life and demands an 18% discount, because he knows the tariff is gone. Best of luck to you!

[wrangler 157]

A couple things come to mind. If the marketplace is actually competitive, retailers will compete for business on price. If the prices don't go down, the government may reinstate the tariff, since the revenue reduction didn't have its desired effect.

[Neal 41]

A couple things come to mind. If the marketplace is actually competitive, retailers will compete for business on price. If the prices don't go down, the government may reinstate the tariff, since the revenue reduction didn't have its desired effect.

I'd agree, at least one retailer will lower their prices in hopes of pulling customers from their competitors. It will be interesting to see how many retailers decrease their prices and by what degree. Chadd is obviously right that pricing is set for this year, so I don't know if the impact will be soon, but I do think it will happen.

[Kessel'sOversizedSuit 18]

I'd agree, at least one retailer will lower their prices in hopes of pulling customers from their competitors. It will be interesting to see how many retailers decrease their prices and by what degree. Chadd is obviously right that pricing is set for this year, so I don't know if the impact will be soon, but I do think it will happen.

The idea that competition will result in lower prices with 18% to play with makes sense, however, with Canadian Tire having such a dominant position in the market, it will take the other smaller players (who seem to have a hard time competing on price as it is) to really push this envelope. Either that or CT will take an aggressive approach and undercuts the competitors who remain, even further.

It will be interesting to watch for sure.

[boo10 323]

The idea that competition will result in lower prices with 18% to play with makes sense, however, with Canadian Tire having such a dominant position in the market, it will take the other smaller players (who seem to have a hard time competing on price as it is) to really push this envelope. Either that or CT will take an aggressive approach and undercuts the competitors who remain, even further.

It will be interesting to watch for sure.

By Canadian Tire, I'm assuming you're referring to the Forzani Group (Purchased by Crappy Tire) ie. Sportchek/National Sports?

[Kessel'sOversizedSuit 18]

By Canadian Tire, I'm assuming you're referring to the Forzani Group (Purchased by Crappy Tire) ie. Sportchek/National Sports?

You assume correctly. And you can add Pro Hockey Life and Rosseau sports to that list.

[oldtrainerguy28 478]

If the others such as source stores and other groups decide to be proactive then it could put the CT group in a corner where they will have to match or beat.....could be interesting.

[Chadd 916]

I would be shocked if the manufacturers adjusted their pricing downward. The pricing is already set and people are paying it. Why adjust down?

I agree, that's exactly what I expect to happen.

[wrangler 157]

If they don't drop prices, there's an opportunity for the journalists to go after them.

[Beflar 55]

I think the big chain stores will in fact lower there prices first. Ie Canadiantire then the rest will have to follow.

All it will take is one store to crack.

Plus i think a lot of us will demanded it, since it was on the cover of the newspapers today. Going to be hard to hide it...

[Larry54 243]

I think the "what the market can bear" principle will prevail, and even though there might be an initial lowering in prices, they will work themselves back up eventually to what the market can bear.

[boo10 323]

Knowing how the retail industry works in Canada, I expect to see very little impact on prices. I would point to CCM U+CL skates as an example. Manufactured in Montreal, the retail price in Montreal stores is still $100.00 higher than in the US, even when the Cdn $ was worth more than the US $.

[AIREAYE 248]

Duncan Fulton, CMO for CT and their FGL Sports division and expresses that "we will certainly do our part to make sure consumers see the benefit."

http://business.financialpost.com/2013/03/21/canada-budget-hockey-gear/

However, that tariff cut on certain items has been followed by a tariff increase on many other items. I guess that money is going back with more certainty now. You win some, you lose some.

http://www.660news.com/2013/03/23/retailers-warn-of-higher-prices-for-everything-from-canned-tuna-to-leather-coats/

[Beflar 55]

Maybe this will open the door to ordering things from the states that are currently banned.

[Larry54 243]

Maybe this will open the door to ordering things from the states that are currently banned.

I really doubt that. If the manufacturers keep the Canadian prices high and pocket the difference, they won't want to lose their cash cow. And if the prices come down to par with U.S. prices, then it won't be worth buying them from the U.S.