Buying Bermuda

One of the things Bermudians are encouraged to do is to spend their money locally rather than buying from abroad. ‘Buy Bermuda’ is a slogan you see a lot around the place.

That’s easier said than done. Bermuda is a hideously expensive place to live and many things cost a lot more here than do elsewhere in the world. Bermudians are well known for going on weekend trips to New York or Boston during which they do nothing but shop and the advent of the Internet has made it easy for people to buy from abroad without even leaving the Island.

Of course, there are a number of reasons why things here are more expensive than in the US:

1. Shipping costs. Being an island in the middle of the Atlantic means that almost everything we need (with the exception of carrots and onions, which it is actually illegal to import) needs to be transported here by ship or plane.

2. Import duty. Most things that arrive in Bermuda, with only a few exceptions, immediately have import duty levied on them. Correctly determining the appropriate rate of duty for a given product is a task that would try the patience of Job (Bermuda customs issues a 350 page document which lists every object known to man and its corresponding rate of duty), but which is typically 22.25%.

3. The cost of living. Because the cost of living here is so high, shops have to pay their workers more than they would in a typical US store.

4. Size. Because Bermuda is so small, the retailers here only place relatively small orders with their suppliers. As such it is almost impossible for them to negotiate the kinds of discounts with those suppliers that big retail outlets in the States can get. There are no economies of scale. The size of the island also gives some companies a near-monopoly which on occasion they choose to exploit.

5. Profiteering. For such a small place you would expect the price of the same item in different stores to be almost identical. In fact I’ve found prices between stores here vary more than in the UK. As the previous points apply to all retailers almost equally, any difference between their prices must be mostly due to the profit margin each chooses to make.

Consider a 20 GB Apple iPod that Mandy and I have recently been looking to buy. Price from an online retailer in the US: $380. Best price in Bermuda: $630. Factor in the shipping ($20) and duty (22.25% = $85) and buying from the US is still $145 cheaper than buying locally.

I’ll leave you to guess what we did in the end.

Comments

[Patty on 13.07.04 at 16:45]

Thank-you for posting this.

My husband and I won a trip to Bermuda for our honeymoon July 3-12th. We stayed at the Southampton Princess. With our island taxes and gratuities paid, we figured bringing $1400.00 US dollars would be plenty. WRONG! Wow! It is more than all gone and this went to just food, drink, and our moped. We bought two t-shirts at the fun Swizzle Inn, some pink sand globes that cost only $8, and a pair of sunglasses. We didn't golf, snorkle, or have spa time (I wanted that luxery since it was our honeymoon). We are from Oregon and were shocked by the price of simple items such as a chesseburger! $15 for a burger that would cost $1.00-3.00 in Oregon. We understood why after chatting with a bartender at the hotel who actually makes the same wage as my husband who is a firefighter. Overall, what a beautiful island! The people are so amazing and friendly. We had a wonderful trip and hope we can afford to come back someday! Loved it!
~Patty in Oregon

[Bill Akin on 13.07.04 at 23:39]

Dear Patty&Hubby
Congratulations! Bermuda as most anywhere can be a bit of a pocket shock. If you ask around you can get a cheeseburger and a really good one for half that price. Do visit Bermuda again. We have for eight years and would not have missed a moment at any price.
Regards, Bill and Robina

[Sue on 14.07.04 at 20:53]

Congrats Patty. Bermuda is like most vacation spots....you can experience it in a wide range of prices. It pays to investigate forums on a vacation destination as you can normally find invaluable information on personal favorites and even cost saving thoughts. One of mine would have been grab a burger at one of the local lunch trucks. They are great and cost about $3.50. That is a deal in Bermuda. Portofino (great Italian food in Hamilton) has entrees for $15.00-$20.00. Let your fingers do the walking and you are sure to gain invaluable and useful info.
Sue

[David C on 16.07.04 at 14:55]

I can give you further reasons for not buying in Bermuda.

1. The customer service is usually terrible.
Who can blame them. They have a job for life and if you dont like the attitude where else are you going to go?

2. 30 Day warranties for Electrical items at some suppliers.
"But Sir we can give you a 12 month warranty if your prepared to pay the extra charge".

3. Delivery Dates.
Having no idea as to when an item you have ordered will actually be delivered. "It might be on this months boat but we aint sure"!

What gets me is that some of these very companies have lots of "Best of Bermuda" awards!

Its okay for me though, following 2 and a half wonderful years we are moving home, somewhere where I can shop around for what I want at a good price and not have to deal with an attitude.

I feel for the poor Bermudians who have to live with this for the rest of their lives.

[Patty & Hubbie "Tony" on 17.07.04 at 05:16]

We would love to come back again~ Thanks for all your advice ;)