Dollar going down

Discussion in 'Indie Business' started by Giuli, Nov 9, 2004.

  1. Giuli

    Original Member

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    I'm about to enter the shareware game business and i'm a "little" concerned about the current dollar fall in the exchange markets.
    This is particularly bad for non-US business owners. Not only we have to pay a good % of our winnings to the e-commerce provider, now in my case(Europe) i lose 30% due to dollar newest low :(

    What can we do to fight this? Not much eh? Rising the prices?
     
  2. Reactor

    Moderator Original Member Indie Author

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    Ya... or take the hit / make a game that sells more.
     
  3. mahlzeit

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    1) Also accept Euros and other currencies.
    2) Spend the dollars you earn in America. :)
     
  4. Redclaw

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    Unless you have a few world leaders in your pocket who you can convince to increase their dollar reserves... not a whole lot. You've just got to ride it out.

    Here's a decent financial forcast which shows at least some hope for the new year: http://forecasts.org/euro.htm though obviously take it with a grain of salt.

    Oh, and you think you have it bad in Portugal?? Just be glad you're not in the UK: http://forecasts.org/pound.htm ($1 = £0.54 atm) :eek:
     
  5. Mark Sheeky

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    Good advice. That $79 download.com fee has never been so low :) Another option is to buy $10000... and re-convert to pounds or euros in 6 months! :D

    Mark
     
  6. Jack Norton

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    Indeed, if I was living in UK I wouldn't even bother to make shareware games... better sell potatoes in local market! :D
     
  7. merovingian

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    Wouldn't that just get eaten up by two-way transaction fees?

    It seems to me at this point, it's too late to capitalize on short-term depreciation or I'd be buying Euros like crazy.
     
    #7 merovingian, Nov 9, 2004
    Last edited: Nov 9, 2004
  8. shoecake

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    The value of the dollar dropped quite a bit earlier in the year but went back up a little. I've noticed quite a drop once again this past month. I usually just adjust my game prices a little to make up for it. The prices of my games hardly have any difference to sales anyway so raising the dollar price makes up for it.

    However, I've been getting many more sales in Europe this year for some reason so the weak dollar isnt affecting me much.

    The recent(ish) change in the VAT laws in Europe was more of an issue than the price of the Dollar to be honest.. as long as the dollar doesnt get too much worse.
     
  9. arcadetown

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    With Bush running up gigantic deficits spurring unchecked spending by consumers I personally only expect the dollar to continue getting weaker.
     
  10. svero

    Moderator Original Member Indie Author

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    Yeah the dollar will drop more. It's really hurt me as I rarely buy anything in the states and I spent outside of the country.

    - S
     
  11. Jack Norton

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    Yeah, like me and many other forums members that live in UK/EU community... :(
    EU is expecially bad also because of VAT.
    Basically if I sell a UBM to UK, I have to subtract to the price of 24.95$ the VAT (17.5%) = 21.23$ (I choose not to add VAT but to subtract from the money I get).
    THEN on those 21.23$ I have to take into account the CRAP dollar value, another 20-25% less.
    Basically I get 40-45% less money from sales from Europe!!!! :mad:
     
  12. MirekCz

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    Jack, huh, one question, you live in europe, don't you?
    So just make europe price 19.99E and usa price 19.99$ and you will get pretty much the same money :)
     
  13. Sillysoft

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    If you were considering adding the VAT on top of the price then the change in the dollar would be a good excuse for it.
     
  14. Nexic

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    I live in the UK so I don't need to pay VAT until Im earning more than 50,000 gbp a year. If I ever start earning that from my games I will simply add it on the top of the price of my games and say that the rise is due to VAT. People these days are used to paying VAT so I don't think it will damage sales much.
     
  15. Jack Norton

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    I think that doesn't work this way... if you use a vendor (probably yes) they HAVE to pay VAT on ESD products sold to EU countries.
    Then, if you own a VAT (because you have a company of any kind) or if you can deduct VAT for some laws in your country, you must CLAIM BACK the VAT. But not simply not pay it directly on sales!!! :eek:
    I suggest you check with an accountant unless you're extremely sure :)
     
  16. princec

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    The current situation with VAT in Europe is - if you are not registered for VAT because you don't meet the threshold criteria, you effectively get charged VAT on your sales and you lose the money, period. It is a very sorry state of affairs and extremely penalising on small businesses (in the UK it's like losing 17.5% of your profits - insane but true).

    Cas :)
     
  17. mahlzeit

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    That doesn't make any sense. If you are not VAT registered, then any sales you make have 0% VAT. Your customers don't pay any VAT on your product. You don't have to pay the VAT to the government, because you aren't VAT registered. That's the whole idea. Of course this also means you can't claim VAT back on things that you purchased for your company. So as long as the VAT you save on your sales exceeds the VAT you have to pay on your purchases, you are in the plus.
     
  18. Jack Norton

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    Not at all. Governments don't care if you're VAT registered or not. If anyone (customer or business) buy a product with online delivery (ESD) they require the VAT - point :)
    It IS a crazy thing indeed, but what princec says is the truth :(

    EDIT: This is true because you're using vendors. The only exception that comes to mind (but I am not even 100% sure) would be selling with your own merchant account without having a company/individual business with VAT (don't know if anywhere in europe is possible though).
     
    #18 Jack Norton, Nov 10, 2004
    Last edited: Nov 10, 2004
  19. Dom

    Dom
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    No - your products MUST include VAT.
    The fact that (if you do your own payment processing at least) you don't pass this onto the government is because the law assumes that you will be paying VAT on purchases required to run your business. If you are below the threshold, then the difference between the VAT you would claim back on those purchases and the VAT you get from your sales is too small to be of any difference.

    Where this bites is if your sales are handled through an external processing company (such as SWReg) which is over the VAT threshold, and hence handles the VAT for you.

    If you raise your prices once you get VAT registered then you can be severely penalised - as you should be charging it now. If your not charging it now for European customers it is VAT fraud.

    Your best bet is to talk directly to the HM Customs & Excise. They probably won't be too bothered at the moment (you can always argue that the price is the price after VAT and you are just charging Americans more, although this may incur the wrath of someone else).

    Be aware that VAT is not handled by the (relatively nice) Inland Revenue - but CUSTOMS & EXCISE! They have extremely large powers under current law - including seizing property (without ever having to give it back), holding you for long periods, etc. Not even the police have as much power as C&E.
     
  20. mahlzeit

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    ShareIt is an example of a payment processing agent that does not resell your products. They can collect VAT for you, but this is optional.
     

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