According to a report by Mobile World Live, the Philippines has the highest prices for the various iPhones in the region. In the report, they also looked into why this was by asking three analysts.
Let’s first take a look at the price difference. The iPhone SE, which was recently released, was priced starting at USD 399 or around PHP 20,170 on the Apple website. On the other hand, the same device on the local Apple website starts at PHP 26,490 or around USD 525. This price in USD can get you an iPhone XR if you added around USD 74 in Apple US.
To further see the difference, we checked the price in Malaysia (RM 1,999 or roughly PHP 23,280), Singapore (SGD 649 or roughly PHP 23,000), and Japan (JPY 44,800 or roughly PHP 21,100). The price difference really is pretty big even compared to our neighbors.
One of the reasons that was brought up was currency exchange. At the time of writing, the Philippine Peso stands at 50.51 to 1 United States Dollar. In addition, Jensen Ooi, research manager covering ASEAN devices for the International Data Corporation, mentioned that freight charges could also have influence over the price.
Abhilash Kumar, research analyst with Counterpoint Research, further expanded that sales tax and import duties can also play a role. Sales Tax in the Philippines, in itself is 12 percent.
Mathhew Xie, Canalys analyst, on the other hand, looked at the distribution model of Apple. Locally, Apple “distributes through third-party resellers such as Switch, Power Mac Centre and iStudio” as opposed to operating stores itself. This causes a further price hike because of the need for the reseller to make a profit.
In contrast, Japan is ranked the least pricey in studies. Xie mentioned that Apple directly operates ten stores in Japan as well as has a lower sales VAT at 10 percent. In addition, Japan received shipments of 5 million iPhones in Q4 2019 compared to the 169,000 of the Philippines.