My Life Abroad: The Adventures of Two Birds
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Thu
8
Dec '11

The Cost of Living in Australia

Lately there’s been lots of talk, and a couple of exposè’s on “A Current Affair” about IKEA and how the pricing structure is different in Australia from that of the UK and America.  It’s hard to understand why this is such a big shocker, when some of the prices are as much as double for the same item purchased in the US but I think that the Australians are forgetting to look at the big picture and are picking on IKEA for something that almost every company is responsible for doing here.

Prices are high.  For those of you that live in the US and complain about high prices for your groceries and clothing, cars and even gas (petrol)… you don’t know the half of it.  Prices are so high in Australia that the weekly groceries that used to cost me $100 in the US cost me about $250 in Melbourne.  In addition to not having the variety of goods (by far) that we have in the US, the prices are double if not more for goods that we use everyday.  I’ve tried to gather a price comparison of grocery goods, and other items just to make my point.  I will not use imported products as the cost may be raised due to shipping costs that are transferred onto the consumer.

 Product  US $  AU $
 Local Beer (6-pk)  3.99  15.00
 Chicken Breast (3 lb., frozen)  5.49  13.00
 Canned Green Beans (14.5 oz)  0.49  1.50
 Loaf of bread (12 grain)  1.89  2.49
 Dozen Eggs (Grade A Large)  1.19  4.50
 Cream Cheese (8 oz)  1.00  3.29
 Toilet Paper (6-pk)  0.98  2.00

Groceries are one thing, but let’s not stop there, mostly I am amazed by the beer prices here in Australia, for not only locally made beer like VB (Victoria Bitter), but for beer like Stella (for example) which is a imported beer to the US, but is made in Australia for Australians.  A 6-pack of Stella in the US is $8.99 (which is imported from Belgium) and the same labelled Stella beer made in Australia is $16.00.  In general we pay about $50 – 80 for a slab of beer (30 cans) – and this is the reason we make our own beer – it pays to have a brewmaster in the family.  It certainly doesn’t stop at beer.

Cars are another shocker, today I saw a left-hand drive 77 Mustang for $30,000.  Does that sound insane to you?  It does to me.  I’ll use Volkswagen as my example because they have some of the same cars for sale in the US and AU.  A VW Golf in the US retails at $17,995- $28,995 and the same car in Australia retails at $25,491 – $57,570.

The clothing problem is a constant one, typically a pair of jeans cost over $100, and because there is no ‘Ross’ or ‘Old Navy’ with bargain basement prices, the only way to get a discount is to shop at Target or Kmart.  And Target/Kmart in Australia doesn’t compare to the stores in the US.  Different brands, products, and quality by far.  Definitely not many stores have larger sized clothing, and you can’t find a men’s shoe over 11-12 (which is a problem for my size 13 husband).

What truly impacts these differences?  The cost of living is much higher here, the minimum wage is $17.00 p hour, but how does that impact a chicken’s eggs, or a grocery store loaf of bread.  I’m tired of hearing the complaints about how Australian’s have to pay for for “IKEA goods” when they are paying more for just about everything.

Shipping costs from the US to Australia are quite high, so you can’t afford to buy Australian, and you can’t affort to buy from overseas. Many websites don’t allow Australian credit cards or don’t ship overseas at all.  Luckily there are now more companies shipping to Oz, making an impact on the Australian market and forcing many to consider that even with high shipping costs, we can get cheaper products from overseas than we can buy at home.

Costco is a new thing in Australia, the first one in Downtown Melbourne – and after 1-year it is taking hold on the retail market, before Costco you never saw bulk packaging, no toilet paper over 12 rolls, no diapers over 24, no block of cheese over 16 oz.  It’s changed the market completely and Costco is moving all over Australia, #2 in Sydney and #3 in Ringwood, Melbourne.  I’d love to see more retailers come to Australia, and make a difference. In the last 7 years I’ve seen a lot of new things in Oz, and and I hope to see more changes as new retailers make their mark here, well…a girl can dream!

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