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this is not unique to FW either, as Wargames Foundry has a similar policy of charging a "inside UK with VAT" and "outside UK with price strangely the same as with VAT"

On top of that they have seperate prices for USD and Euros so as to to profit from exchange rate swings (always a profit, the prices go up when values decline)

Okay, here is the legal situation regarding VAT which I reseached through my company's Employee Assistance Programme.

Regarding Mail Order from outside the EU, there is no legal obligation to refund the VAT. The selling company needs to have voluntarily joined the scheme by registering with Customs and Excise. This would let them sell the goods to non-EU residents with VAT deducted. If they don't do this, the VAT has to be charged.

It seems Forge World have not joined the scheme so they charge the VAT and pass it on to the UK tax authorities.

I am slightly surprised Forge World haven't joined since as small a company as Baccus 6mm does not charge VAT on overseas orders.

www.baccus6mm.com

Perhaps a campaign by overseas customers would help convince Forge World to register.

Kilkrazy wrote:Okay, here is the legal situation regarding VAT which I reseached through my company's Employee Assistance Programme.

Regarding Mail Order from outside the EU, there is no legal obligation to refund the VAT. The selling company needs to have voluntarily joined the scheme by registering with Customs and Excise. This would let them sell the goods to non-EU residents with VAT deducted. If they don't do this, the VAT has to be charged.

It seems Forge World have not joined the scheme so they charge the VAT and pass it on to the UK tax authorities.

I am slightly surprised Forge World haven't joined since as small a company as Baccus 6mm does not charge VAT on overseas orders.

www.baccus6mm.com

Perhaps a campaign by overseas customers would help convince Forge World to register.

Sounds like a plan to me!

I'll send them an e-mail and post the reply here, if I receive one...

Its part of their business model to create extra margin from shipping. And means their store will get larger orders than they otherwise would wih the free shipping threshold.

Killkrazy..
Voluntarily joined what scheme for mail order.. erm I think you might be confused. It is the normal VAT rules for sales in and out of VAT able areas.. no special scheme required. Just proof of delivery outside of Europe. There might be one for retailers offering VAT reclaim forms at pos or in store which a few larger stores (Harrods for example) has. Or at least did have.

Pfft, securely packed...they're idea of "securely packed" is tossing all of the extremely fragile, worth their weight in gold and then some pieces of resin loosely into a bag, throwing that bag into a box, and then placing exactly one layer of bubblewrap on top of it.

Or at least, that's what it looks like judging from the packages I've gotten from them. Needless to say I thought that was pretty damn annoying when my barracuda showed up like that, which at the time was over $120 just by itself. But oh no, they don't just ship their models out in a plain plastic bag like "other" wargame companies, eh?

rich1231 wrote:Its part of their business model to create extra margin from shipping. And means their store will get larger orders than they otherwise would wih the free shipping threshold.

Killkrazy..
Voluntarily joined what scheme for mail order.. erm I think you might be confused. It is the normal VAT rules for sales in and out of VAT able areas.. no special scheme required. Just proof of delivery outside of Europe. There might be one for retailers offering VAT reclaim forms at pos or in store which a few larger stores (Harrods for example) has. Or at least did have.

According to the legal team on my company's Employee Assistance Programme it is like I posted above.

There is no automatic VAT refund or exemption, the selling company has to join the scheme voluntarily.

Kilkrazy wrote:

rich1231 wrote:Its part of their business model to create extra margin from shipping. And means their store will get larger orders than they otherwise would wih the free shipping threshold.

Killkrazy..
Voluntarily joined what scheme for mail order.. erm I think you might be confused. It is the normal VAT rules for sales in and out of VAT able areas.. no special scheme required. Just proof of delivery outside of Europe. There might be one for retailers offering VAT reclaim forms at pos or in store which a few larger stores (Harrods for example) has. Or at least did have.

According to the legal team on my company's Employee Assistance Programme it is like I posted above.

There is no automatic VAT refund or exemption, the selling company has to join the scheme voluntarily.

This is all irrelevant though, is it not? fullheadofhair has already explained what FW are doing; they arent charging VAT to non EU customers at all - hence why they dont need to declare it or sign opt out forms or whatever. What they are doing is effectively charging more to Non EU customers because the 17.5% portion of the cost that would normally go to the taxman is going into FW's pocket instead.

And really, I can see why Forgeworld doesn't (as much as I don't like it!), but their 'free shipping' threshold ought to be a bit lower too...

Alpharius wrote:And really, I can see why Forgeworld doesn't (as much as I don't like it!), but their 'free shipping' threshold ought to be a bit lower too...

and this is why I don't buy from FW. I mean, not only are they sticking the shaft by having a VERY high margin because of an additional 15% on US sales but the cheeky buggers charge (or used to) a higher shipping %age for being oversea. Man, that is REALLY taking the piss.

It isn't illegal, but it is borderline immoral IMHO

KillKrazy

I would respectfully suggest your employers "legal" team speak to HMRC to clarify.
If VAT has not ben itemised there is nothing to reclaim.

chaplaingrabthar wrote:How is saying "gak, you people need to put your big girl panties on and man up a little" NOT insulting to other posters?

It certainly seems like a contravention of Rule #1 to me, but since you get the [MOD] stamp, I'm sure you can get away with it.

What I have learned from Frazzled is that you can insult someone as long as you think that what they are talking about is complaining. This should cover you for about 50% of all posts in News&Rumors and Discussion.

fullheadofhair wrote:

Alpharius wrote:And really, I can see why Forgeworld doesn't (as much as I don't like it!), but their 'free shipping' threshold ought to be a bit lower too...

and this is why I don't buy from FW. I mean, not only are they sticking the shaft by having a VERY high margin because of an additional 15% on US sales but the cheeky buggers charge (or used to) a higher shipping %age for being oversea. Man, that is REALLY taking the piss.

It isn't illegal, but it is borderline immoral IMHO

Yeah, FW has some pretty shady practices. Overcharging on shipping/VAT charging the US, on top of already not-so-awesome customer service and quality control. I have bought a few FW pieces in my time but I would never consider buying a significant amount of their stuff.

LunaHound wrote:

wardancer wrote:LunaHound- they clearly stated that they don't profit from P&P- matey just proved that they do, so unless they donate it to a charity, that makes them liars. As somebody else wrote- GW just with a different hat. I was considering ordering few bits, but seeing that I will give it a miss.

If you count the loss from the free shippings , how do you gather that it totals to be a profit o_o?

They stated they don't make a profit from shipping. Have you guys considered they were talking about shipping OVERALL? They don't make a profit on shipping because they offer free shipping on all the big stuff. So...from a business persepective, they do NOT make a profit on shipping. They may make extra on the small orders but they are losing big on the big orders.

filbert wrote:

Kilkrazy wrote:

rich1231 wrote:Its part of their business model to create extra margin from shipping. And means their store will get larger orders than they otherwise would wih the free shipping threshold.

Killkrazy..
Voluntarily joined what scheme for mail order.. erm I think you might be confused. It is the normal VAT rules for sales in and out of VAT able areas.. no special scheme required. Just proof of delivery outside of Europe. There might be one for retailers offering VAT reclaim forms at pos or in store which a few larger stores (Harrods for example) has. Or at least did have.

According to the legal team on my company's Employee Assistance Programme it is like I posted above.

There is no automatic VAT refund or exemption, the selling company has to join the scheme voluntarily.

This is all irrelevant though, is it not? fullheadofhair has already explained what FW are doing; they arent charging VAT to non EU customers at all - hence why they dont need to declare it or sign opt out forms or whatever. What they are doing is effectively charging more to Non EU customers because the 17.5% portion of the cost that would normally go to the taxman is going into FW's pocket instead.

As I understand it they are charging VAT. That is why when VAT went down to 15% they generously knocked 2.5% off the overseas price.



Automatically Appended Next Post:

rich1231 wrote:KillKrazy

I would respectfully suggest your employers "legal" team speak to HMRC to clarify.
If VAT has not ben itemised there is nothing to reclaim.

VAT is not normally itemised within UK retail receipts but shops which have joined the scheme can and will do so on request, in order to facilitate the refund. An example would be Harrods.

FW haven't joined the scheme and do not offer the chance to get a refund.

Retailers are obliged to provide VAT receipts where asked. Its not some special situation.

The reason FW dont show VAT is because they show
Inclusive prices. When a EU customer orders the VAT is itemised (or should be) when its a rest of world customer they dont itemsise the VAT and keep it as extra margin.

It is nothing to do with any scheme whatsoever.

ph34r wrote:What I have learned from Frazzled is that you can insult someone as long as you think that what they are talking about is complaining. This should cover you for about 50% of all posts in News&Rumors and Discussion.

You're just jealous because all the voices talk to me!

Fullheadofhair has helped me understand this VAT issue. It's the same price no matter which way you cut it "BUT" for all euro, and UK sales FW itself has to spill out more of their profits to the GOV'T no different then say a retailer switching from GW to Alliance for GW products. They still get the same product and charge the same price, but just make less profit margine. Ergo I am sure FW takes this into consideration when they create their prices knowing that they loose out on some sales and as such may up the price to insure not a heavy loss. No one is paying more then the other and no one is paying another nations taxes.

jbunny wrote:
2. They told you up front how much it was going to cost to ship the item to you. You agreed to that amount so they did not over charge you. You might feel ripped off, but they charged you what you agreed to pay.

I think opinion plays out here, you may not feel that paying beyond actual cost (when told you were paying COST and nothing more), isn't being overcharge. The OP feels different.

In essence he was overcharged as he was told he would be paying COST, when he very clearly isn't.

TheSecretSquig wrote:I thought I'd share a little email exchange with you all I've had with the Forgeworld Customer Services Manager (I'll remove all names, just leave titles). I recently ordered some stuff, to which the P&P cost came to 14.65 or 12% of my Order. In the box where you can enter the '1 Forgeworld Model to be made' request, I put in "Free P&P, because lets be honest, to post what I've bought isn't going to cost 14.65". Surprisingly, I received the following email from Forgeworld............

===========================================
Hi,

Thanks for placing the above order. To explain our shipping costs, an order within the UK is charged 12% of the total value of the order in shipping and handling, as we endeavour to ensure that our orders are packed in such a way as to minimise any potential for damage in transit.
You will not receive your order in a jiffy bag or similar, as many wargames companies use, but instead firmly packed in a sturdy box. Note that resin kits are often heavy, and as you are no doubt aware the weight of a parcel also affects the postage cost.
Please don’t hesitate to contact us if you have any further queries.
Regards,
Customer Service Manager,Forge World

===========================================

So when the box arrived, I took it to the Royal Mail Office, and was quoted 2.41 to post it First Class (the same method as FW) to anywhere in the UK. I emailed the Customer Service Manager back.......

===========================================

Thanks for your reply. I waited until I had recieved my order before replying. I took the parcel to the Post Office and had it weighed and quoted for First Class Post to anywhere in the UK .
2.41 GBP. Quite a large difference to the +14.00 GBP charged by Forgeworld. I can't see how a small box and bubble wrap or even the 2 mins of labour could cost +11.00 GBP, so my original comment still stands. It does not cost 14.00 to send out my Forgeworld Order to me.
A GW mail Order is free shipping over 50GBP. Malestrom Games send out all their items, including resin, P&P is free, and they are in a sturdy box, padded with bubble wrap, just like Forgeworld.
Seeing as I have now proven the Forgeworld have overcharged me for P&P by a factor of +400% on this order, please feel free to refund me or send me some Vouchers. Your email below suggests you feel Forgeworld do not overcharge on P&P, clearly you do.
Thanks

============================================

And surprisingly, I recieved a reply........................

============================================

Thanks for your e-mail.
Here at Forge World we endeavour to provide a quality service that ensures you receive our products in the most effective way. Our team regularly review the prices we charge for shipping, and these are to cover our costs not make a profit. As you may have noticed, we offer free Express shipping on large orders and currently free standard shipping on all orders over £150 – we anticipate this to be a long-term offer that will benefit many of our customers.
You can also visit us at events such as our forthcoming Open Day here in Nottingham on March 28th, at which you can come and pick up almost anything in our range. The Open Day will also allow you to meet our entire staff including our Studio of writers, artists and sculptors, as well as to play some fantastic games and view work-in-progress models, books and artwork. The Open Day is free to attend and is a great way to save on Shipping costs.
We hope to see you there! If you have any further queries, please don’t hesitate me to contact me.

=============================================

So I have contacted FW, and I will take the matter higher when I'm at the next shareholders meeting. I've pointed out that the packing box and wrap it part of the cost of the product, as if you buy it direct from GW HQ, it comes in that box without any additinal charges. As a company they can charge whatever they like for P&P, but to blatently lie to a customer and claim their P&P charges are at cost, when I've proven they are out by a factor of +400% in their favour (in this instance), is what rattles me. Quote from the email above "cover our costs not make a profit". Does anyone else think this is a lie, or is it me?

He would have been better not to reply to me, rather than dig this rather large hole for himself. In trying to convince me in the truth of a lie, he's actually made it worse.

Bravo! I commend you sir! You represent a ray of hope in a world where most the gene pool is about as deep as a spittoon. I whole-heartedly wish more people would challenge things in the manner you did, and you did it with such class and cunning!

That being said... I really hope you win your case, if you are truly a stockholder and are able to attend the next shareholder's meeting I would love to hear the results of you bringing up your experience... if you can't try and sherlock-google to get the Email of a higher-up at gw, make sure to CC the respective Better Buisness Bureau (Or your country's equivalent) to let the Executive know you are serious.

one moment please

As for all the people claiming that the Postage is justified because of the "Large Order". Clearly you have never worked in a retail marketing environment... Take forinstance a GW Employee, lets say you get an Employee discount of 25% (Or the preferred plan corperate discount of 50%). GW is still making a profit off of your sales or else they would not be selling the product off of you. That means every PENNY of a normal sale is THAT much more in profit for the company (Meaning for example, GW could afford to sell Rhinoes at 15$ each, but instead, every 30$ rhino is 15$ more profit then whatever the margin is on the preffered discount). I used to work at bestbuy, and not even looking at the ~90% I got off of certain products (Like HDMI cables that would retail for 110-85$, I would get for around 10$) I was also the Apple Expert. Apple is a consumer based company like GW. What that means is that the profit margin for Apple products is so high, it would make your nose bleed if you put it in Feet (or Meters for you metric folks) and stood on top of it... for example... the iMac 24" model retails for around ~1800$ (for the most high end) and the 20 Inch around ~1200. I had a friend who was buying our old iMacs. Bestbuy cannot change the price of an apple to lower then around a 20% profit margin for apple, as apple has some weird deal with bestbuy in which they are actually 'renting' out retail space and 'sharing' the profit with us. (So Apple techinically still owns the computers in our store until we sell them, and split the profits with BB on like a 30-70 ratio IIRC). So that means, lets say every dollar after 1000 (on the 1800$ model) was profit (80% profit margin) I would not be allowed to sell the computer for 1200. Now, if this were the margin (which is still about 2x that of a high end PC/Laptop that would cost the same price range) I probably would not have a very good example.... so let me tell you what the actual price was... I was able to sell him both iMacs (20 and 24Inch) at a COMBINED price of 900$ (INCLUDING abour 180$ worth of Service plans, which are pure bestbuy profit)... this means that 20% price-profit on a 24 inch Imac is around ~500, and the same on the 20inch is ~300... thats a ton of profit! Kinda puts the whole "Free ipod touch when you buy a 2800 Mac Book pro(Which you don't even want to know the profit margin on that... lets just say I could sell it for LESS then the 24" iMac...)" deal into perspective...

Now, why would I bring this up? Because some companies, especially "consumer based" companies, make astronomical profit margins... especially on their more expensive items. So when you think about it, giving free shipping on any order over 150GBP not only makes sense, but is at least somewhat reasonable. Given the 60GBP shpping example, I don't think GW or FW cares about "sucking the loss" even of an amount that high, when they are making most likely 6-700% profit on the actual order... keep in mind, Profit is NOT revenue, profit is AFTER they factor in the shipping*, labor, parts and other misc costs. Let me state that again, PROFIT is AFTER they factor in SHIPPING, labor, parts, and OTHER MISC COSTS. So realistically, based on the price of the item, ALL FW orders should be free shipping, as a Consumer Based company, they are already making TONS of money on their product itself.

Charging smaller orders to pay for the "free" shipping on larger orders is a terrible buisness plan, especially for a CBC. But then again, thats not what they are doing... what they are doing seems to be terribly more malicious, they are trying to pinch MORE profit out of a market, probably due to the fear of it dying. (Completely Unjustified, as 2009 was GWs best fiscal year in a while IIRC) People like TSS are godsends, especially to hobbiests like us, that more people should learn from example. Because in the end, to be totally honest, these people also HELP the industry and CBCs like GW stay alive, the global economy, especially in the Retail world, is heading towards a Customer-Service industry. Socionomics shows that tools like these messageboards, Facebook, twitter, and just word of mouth are more supportive to a company then any advertisement, or even quality of product. If places like GW/FW don't learn from their mistakes, they WILL be left in the dust by someone who does get it right, or more likely (and much more ironically) when a virtual medium of their product becomes successful (w40k mmo). The same thing almost killed Magic the Gathering and Wizards of the Coast (thus people switching to online versions of that game) when they were hiking up profits (raising booster pack costs, starter and structure deck prices etc) and hopefully GW will go the way of a successful buisness, and not a dying giant.

Sorry for the rant, but hopefully, if nothing else, you have learned something!
-DAR

Kilkrazy wrote:

As I understand it they are charging VAT. That is why when VAT went down to 15% they generously knocked 2.5% off the overseas price.


VAT is not normally itemised within UK retail receipts but shops which have joined the scheme can and will do so on request, in order to facilitate the refund. An example would be Harrods.

FW haven't joined the scheme and do not offer the chance to get a refund.

No, you are wrong - as I said I may live in the US but I am English and I am an accountant with VAT experience which is why I had the email exchange with head of FW. He stated they don't charge VAT on US sales.

If in England you issue and invoice or receipt it has to have the company's VAT number. Here is the very basic theory. The amount you of VAT you pay the gov is the net of inbound (what people charge you) and outbound (what you charge the customer). If you are making a profit, in theory you always end up paying the government because the total inbound costs should be less that you total outbound revenue!

If the invoice you receive doesn't have a VAT number on it you cannot deduct from you inbound VAT. Also, in memory serves me correctly, by law you cannot charge VAT unless you put your company's VAT registration number on the invoice or receipt. FW invoices overseas do not have FW VAT number on the them - I dug out an old number.

As to your comment about the reduction in VAT, you are not right there either - FW charges one price (unlike the old days). By reducing the VAT rate on English sales we in the US also benefited from the drop. But don't think it was alturistic - one, they would have had to change their website to maintain mutliple prices and two, how odd would it have looked if they reduced UK prices becuase of VAT (drop to 15%) but then kept the US prices at the 17.5% included rate.

Don't know how to put, but the points you are raising are wrong factually as well as to how FW operates. I know this because of my knowledge of VAT and the fact I had this very same argument with them already. It caught head of FW by surprise - and as he said they really didn't expect someone with indepth VAT knowledge living in the US to start asking questiosn.

to the OP:

as someone who works in an internet mail order business, it sounds like you are just whining about shipping costs that you could have not paid by simply not ordering.


They have to pay the postal service, they have to pay warehouse workers, they have to pay customer service agents to deal with whiney customers who could have just not purchased something as opposed to wasting time+money on something as small as a few dollars to cover costs.

Games workshop and forgeworld are luxury companies, they do not produce anything that you cannot live without, you paid the price then expected a refund after the fact, this is just ridiculous. its so ridiculous its...

Demogerg wrote: you paid the price then expected a refund after the fact, this is just ridiculous.

No, if you read the entire post, he expected a refund because he was LIED to by that same CSR who "has to deal with whiny customers".

First off, if thats what you think a CSR department is for, then your Internet Mail Order Business probably won't last (or your position isnt in any sort of leadership, as every company knows, the CSR department is the heart of a company), but all that aside, you should at least know (as an employee of an "internet mail order business") is that #1. You should typically be paying LESS then a residential postage amount and #2 The cost of the product itself factors into the Warehouse workers, CSRs, and any Postal Contracts they hold. It wouldn't go into an inflation of the Shipping price.

The CSR said that FW does not try to make ANY (that means 0.000000000000000000000000000000000000000 of ANY Currency) profit off of the shipping, sent the package to the OP, and the OP prooved by price-checking a return trip on postage, that the CSR was LYING. Thus the (deservedly) requested refund.

The thread would be more informative, if people took a moment to take GW/FW off the pedestal and realise that they are being robbed. If they want to claim to be a Luxury Vendor, they should add the price (the 12GBP as it is in this situation) to the price of the model and not overcharge for shipping, what they are doing is called Bait-and-Switch(A form of False Advertising), in the states, that is illegal... I'm not sure how UK law works on that.

Daemon-Archon wrote:

Demogerg wrote: you paid the price then expected a refund after the fact, this is just ridiculous.

No, if you read the entire post, he expected a refund because he was LIED to by that same CSR who "has to deal with whiny customers".

First off, if thats what you think a CSR department is for, then your Internet Mail Order Business probably won't last (or your position isnt in any sort of leadership, as every company knows, the CSR department is the heart of a company), but all that aside, you should at least know (as an employee of an "internet mail order business") is that #1. You should typically be paying LESS then a residential postage amount and #2 The cost of the product itself factors into the Warehouse workers, CSRs, and any Postal Contracts they hold. It wouldn't go into an inflation of the Shipping price.

The CSR said that FW does not try to make ANY (that means 0.000000000000000000000000000000000000000 of ANY Currency) profit off of the shipping, sent the package to the OP, and the OP prooved by price-checking a return trip on postage, that the CSR was LYING. Thus the (deservedly) requested refund.

The thread would be more informative, if people took a moment to take GW/FW off the pedestal and realise that they are being robbed. If they want to claim to be a Luxury Vendor, they should add the price (the 12GBP as it is in this situation) to the price of the model and not overcharge for shipping, what they are doing is called Bait-and-Switch(A form of False Advertising), in the states, that is illegal... I'm not sure how UK law works on that.

The internet mail order business I work for has been operating online since the early 90's and the parent company has been around for over 100 years, doing phone and catalog mail order for who-knows how long.
the reason businesses dont add the cost (12 GBP in this sitatuation) to the item itself is because if you purchase over a certain value of the items, (150 in this case i believe) then they dont charge you shipping at all, and you save a bucket of money, if they added the cost to each individual item, then the number of large order decreases, and the number of small, time consuming order increases. They are rewarding customers who purchase in bulk, not punishing customers who order small.

This also has nothing to do with putting GW/FW on a pedestal, they are operating a standard mailorder business model.

Bait and Switch would be misleading the customer with false information, the customer in this case was fully aware of how much they were being charged for shipping, if they had a problem with that then they should bring that up BEFORE ordering.

So the long and the short of it is...in the UK the Forgeworld prices displayed are inclusive of VAT and you get a receipt that breaks down the cost of the item and the VAT and that adds up to the displayed price on the website. The website price is also charged as a flat raten to US customers, but instead of giving them the cost of the item minus VAT, they bill them the UK price inclusive of VAT but simply don't show this on the bill, the basic price of the item is declared to be the same as the advertised price and the VAT conveniently disappears making the US and UK prices identical.

GW do quite nicely from this then, because they effectively charge the VAT to US customers but don't pass it on to the government, because they don't actually call it VAT on the receipt. They just bill US customers the UK price and keep the difference. They get around it by simply not acknowledging the VAT on the recipt. Correct??

That's a fairly dirty trick if so because the advertised price on the UK site is supposed to include VAT that US citizens shouldn't be paying. I don't know about the legality of it though.

derek wrote:

jbunny wrote:
2. They told you up front how much it was going to cost to ship the item to you. You agreed to that amount so they did not over charge you. You might feel ripped off, but they charged you what you agreed to pay.

I think opinion plays out here, you may not feel that paying beyond actual cost (when told you were paying COST and nothing more), isn't being overcharge. The OP feels different.

In essence he was overcharged as he was told he would be paying COST, when he very clearly isn't.

No it's a matter of people not fully understanding direct and indirect cost of shipping.

Direct cost - The cost RM chrages, the cost of bubble wrap, the labor cost of the guy packing the model.

Indirect cost - Cost of building, power to the building, Cost of insurnace on building.

Now I don't know how they allocate cost to shipping, but I assure you it is not just the cost the RM chrages. So until you can give me a complete break out of all of there charges and then tell me they are over charging, you arejust speculating.

jbunny wrote:

No it's a matter of people not fully understanding direct and indirect cost of shipping.

Direct cost - The cost RM chrages, the cost of bubble wrap, the labor cost of the guy packing the model.

Indirect cost - Cost of building, power to the building, Cost of insurnace on building.

Direct Costs
- The Cost RM charges: in this case, ~3gbp
- The cost of Bubble wrap: for the typical model, probably less the the cost of data to store the transaction txt.file...
- The cost of Labor: Assuming he makes 5GBP and hour, ~0.09GBP

Indirect Costs
Cost of building - Assuming you mean the FW building, again that should be calculated into the price of the Product, not the shipping, if you mean the Shipping building, that should be calculated into the ~3gbp it costs to ship.
Power of building - Same as above. Also to add, FW will required the building regaurdless of your order and does not stay open past normal business hours just to ship your order, so your particular order's shipping being factored into building cost makes 0 sense.
Insurance of building - Same as above.

If anything the only Indirect costs for the SHIPPING would be things like packaging, shipping insurance, etc. However none of these were mentioned nor should they at all be even close to the 14GBP that was charged for the item. If the above were considered in every postage stamp ever then it would cost ~10GBP per promotional mailing/magazine/just about anything, that you ever recieved in the mail... seeing that most promotional mail items are mailed for free (and usually at the dismay of the recipient. aka spam) I don't think FW has much ground to stand on for the 14GBP shipping rate...

Daemon-Archon wrote:

jbunny wrote:

No it's a matter of people not fully understanding direct and indirect cost of shipping.

Direct cost - The cost RM chrages, the cost of bubble wrap, the labor cost of the guy packing the model.

Indirect cost - Cost of building, power to the building, Cost of insurnace on building.

Direct Costs
- The Cost RM charges: in this case, ~3gbp
- The cost of Bubble wrap: for the typical model, probably less the the cost of data to store the transaction txt.file...
- The cost of Labor: Assuming he makes 5GBP and hour, ~0.09GBP

Indirect Costs
Cost of building - Assuming you mean the FW building, again that should be calculated into the price of the Product, not the shipping, if you mean the Shipping building, that should be calculated into the ~3gbp it costs to ship.
Power of building - Same as above. Also to add, FW will required the building regaurdless of your order and does not stay open past normal business hours just to ship your order, so your particular order's shipping being factored into building cost makes 0 sense.
Insurance of building - Same as above.

If anything the only Indirect costs for the SHIPPING would be things like packaging, shipping insurance, etc. However none of these were mentioned nor should they at all be even close to the 14GBP that was charged for the item. If the above were considered in every postage stamp ever then it would cost ~10GBP per promotional mailing/magazine/just about anything, that you ever recieved in the mail... seeing that most promotional mail items are mailed for free (and usually at the dismay of the recipient. aka spam) I don't think FW has much ground to stand on for the 14GBP shipping rate...

I disagree, the indirect cost of running a mail order business remains the same weather you order $1000 worth of product or $10, to increase the cost of the product to cover the static overhead cost of the business would be a foolish move, insted they offer a shipping price based on their cost, and offer FREE shipping if you order over a certain amount, because the profit margin of the product then covers the cost of shipping.

Daemon@

Where did you get your accounting degree from? Just wonderign where your expertise on Cost Accounting comes from. Personally, I graduated from the Number 15 school for accounting according to US News and Reports. I have been doing accounting for several years, most of which as a cost account. While not an expert, I know what I am talking about.

As far as shipping, it is a common practice for manufactoring companies to portion of thier shipping done after normal business hours because it gives the plants time to complete orders. Otherwise you might have shipping just standing around waiting on orders to be completed. I worked 4 years in the shipping /Receiving for a large manufactoring company while in college.

While I do not know how GW allocates cost for shipping, I do know how other companies allocate indirect cost. If shipping is a major (in terms of energy not money) section of the business, then you allocate a portion of indirect and fixed cost to it. I don't think Forge World has to many POS locations where you can walk up and buy direct, so shipping is a major Cost center.

Just to give you another leason, Forge World should have equipment that is only used in the shipping process. Things like Packing Stations, Pick Trucks for reasching items on high shelves*, scales, Tape dispensors. The cost of those items could be broken down on a per package shipped basis,and is therefor a cost to ship.

* Not sure have never been to their warehouse before, but this would be used in a lot of operatings.

Alpharius wrote:

Kilkrazy wrote:Okay, here is the legal situation regarding VAT which I reseached through my company's Employee Assistance Programme.

Regarding Mail Order from outside the EU, there is no legal obligation to refund the VAT. The selling company needs to have voluntarily joined the scheme by registering with Customs and Excise. This would let them sell the goods to non-EU residents with VAT deducted. If they don't do this, the VAT has to be charged.

It seems Forge World have not joined the scheme so they charge the VAT and pass it on to the UK tax authorities.

I am slightly surprised Forge World haven't joined since as small a company as Baccus 6mm does not charge VAT on overseas orders.

www.baccus6mm.com

Perhaps a campaign by overseas customers would help convince Forge World to register.

Sounds like a plan to me!

I'll send them an e-mail and post the reply here, if I receive one...

I'd love to hear the results of this, if you get a reply back!

RiTides wrote:

Alpharius wrote:

Kilkrazy wrote:Okay, here is the legal situation regarding VAT which I reseached through my company's Employee Assistance Programme.

Regarding Mail Order from outside the EU, there is no legal obligation to refund the VAT. The selling company needs to have voluntarily joined the scheme by registering with Customs and Excise. This would let them sell the goods to non-EU residents with VAT deducted. If they don't do this, the VAT has to be charged.

It seems Forge World have not joined the scheme so they charge the VAT and pass it on to the UK tax authorities.

I am slightly surprised Forge World haven't joined since as small a company as Baccus 6mm does not charge VAT on overseas orders.

www.baccus6mm.com

Perhaps a campaign by overseas customers would help convince Forge World to register.

Sounds like a plan to me!

I'll send them an e-mail and post the reply here, if I receive one...

I'd love to hear the results of this, if you get a reply back!

Wow, this thread has caught my interest, particularly this part. I have been putting off a Forgeworld order due to the price+ shipping for a bit now. Waiting on my taxes and sneaking it past the wife. Now if only some person would make a website to petition FW with signatures to participate in this. Someone...anyone....do it for us lazy people with no web skills?

A few things to think about. Say if they do charge the "appropriate" price for shipping , where do you suggest they
take the amount to cover for the free shipping on large orders?
Do you want:

a) Everyone pay for appropriate shipping , no more Free Shippings.

b) Keep free shipping on large order , charge appropriate shipping on small order , raise price on product to cover for free shipping.

Im sure FW and like most of companies prefer large batch per order to ship , then having to deal with small $15 purchases.