The Switch Conundrum

By Nicolas See Tho on Jul 13, 2017

Back in March, there were many Nintendo fans eager for the arrival of Nintendo's new console, the Nintendo Switch. After the disappointment which was the Wii U, fans were eager to finally get their saving grace and saved the franchise it did, but at a hefty cost, to us Malaysians.

While huge improvements were made on the Nintendo Switch, such as region free play, portable gaming personified and improved hardware, one factor remains different from another, and that is the console pricing. In Malaysia, the prices we get for the Nintendo Switch can easily be 30% above the current global rates. Take a look at some of the prices I found, as I scrounged the Internet for price comparisons.

Price found in Lazada
Price found in Lazada

 

Price found in Kyo's Gaming Mart
Price found in Kyo's Gaming Mart

 

 

 These are some of the prices that we see on our local e-commerce markets and stores. Now let's take a look at what the rest of the world gets when it comes to bang for your buck Nintendo Switch pricing.

Pricing taken from a Hong Kong currency rate, which equates to RM1461.32
Pricing taken from a Hong Kong currency rate, which equates to RM1461.32

 

 

 

This is a bundle package from BestBuy, with a converted currency rate of RM1554.40
This is a bundle package from BestBuy, with a converted currency rate of RM1554.40

 

So what does this tell us, this means that all the screaming and wailing on Facebook comments and Twitter feeds for us Malaysians are justified. These price hikes are monumental especially when it comes down to what is being offered. So now to go to the root of the problem, we must first analyze what is causing these price hikes. The first glaring issue would be a shortage of stock. It was a known fact that Nintendo has been providing limited quantities of their new console devices to each region causing a shortage of supply for an overwhelming demand.

But could that truly be the cause for the price increase of over 30% in Malaysia? Evidently not, as while most of the stocks may have been sold out, the price remained the same in other regions with no sudden increase in pricing even throughout the high demand phase. So now we turn our focus on a different perspective, is there a 3rd party at fault here causing these price hikes? To answer that question, we must first look to the community for scalpers, individuals who pre-purchase a limited edition item with intent to sell at a higher price. So are there any within the community, well our voyage through the usual mediums of sale on Facebook and forums have found the pricing to be as below.

Seen here is a deal we found online at Lelong.com
Seen here is a deal we found online at Lelong.com

Facebook may have some tempting deals compared to the rest but with the risk of authenticity
Facebook may have some tempting deals compared to the rest but with the risk of authenticity

 

From what we can see, the pricing remains almost similar. Thus the matter goes back to the source of the issue which is where are we getting our supply from and how is it being managed. Is the distributor increasing the price within this region intentionally with the purpose of higher profit margins? Is this a case of the import tax and duty tax creating a price surge? I believe among the 2 cases above, we shall try to tackle the latter. 

Malaysia imposes 5-50% duty tax on a wide range of products with an average duty tax of 6%. This tax will also add on an additional 6% GST after calculations. Thus using this arithmetic, if we use the BestBuy Nintendo Switch as a sample after conversion, we will get:

(RM1556.43 +6%)+6%=RM1748.80.

The prices we have seen so far range from RM2000 to RM2300. As such, it is hard to see how the taxes can be used to justify the cost of the end product even if they were part of an exclusive bundle. This just brings us down to the remaining issue which is the operations and distribution of the Nintendo Switch. We, as consumers need to ask if we are being victimized here when all facts are provided in broad daylight on the price disparity. Should we only rely on our local options if they are more expensive than the international options? At the end of the day, as a gamer who strives to be a smart consumer, I will always choose any options that leave me in between good choices rather than bad options.

 

 

Nicolas See Tho
About the Author
A quirky gamer who has unrealistic expectations on survival RPGs, unrelenting hope for proper cooking mechanics and a love for tabletop gaming
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