The Cost Benefit of Buying Luxury Goods Overseas

Last year, I read an article touting the cost benefits of buying luxury goods while traveling overseas from the United States. So, I put it to the test last year on my trip to Australia. I had been eyeing the Félicie Pochette by Louis Vuitton and had difficulty finding it at home in Chicago and online. Many of the manufacturer’s small leather goods were sold out due to the shopping surge during the pandemic. It was available in Brisbane, and I saved $300 versus purchasing it in the US. Before leaving for a trip to Milan, Italy, a couple of months ago, I researched a Christian Louboutin bag I fell in love with. I decided to purchase it while on my trip because the savings would be even more significant than in Brisbane.

Why Is It Less Expensive to Purchase Luxury Goods Overseas?

There are a few reasons why luxury goods can be less expensive abroad than in the US.

1. There are price differences between countries. a. While these brands try to maintain similar prices worldwide, products will still be less expensive in certain countries, like the country of origin for the brand. b. When products are shipped, import taxes and transportation costs get passed on to the consumer.
2. Exchange rates change over time, and sometimes, the dollar has a more favorable position.
3. VAT refunds further reduce the price. Completing minor paperwork and submitting it at the airport or train station is time well spent.

Purchasing Louis Vuitton in Brisbane, Australia

When I purchased the Louis Vuitton Félicie Pochette last October, the US dollar was favorable to the Australian dollar. This and the VAT return yielded $298 in savings, an 18.8% discount, versus purchasing the bag at home in Chicago. See below.

	United States Dollar	Australian Dollar Converted to USD
Product Price	$1,490	$1,407
Fina Price: Plus Tax or Minus VAT	$1,583	$1,285

*Prices rounded to the nearest dollar.

                        

Purchasing Christian Louboutin in Milan, Italy

This August, the dollar was slightly unfavorable to the Euro, but there are limited transportation costs by purchasing in Europe and the VAT refund. I wasn’t sure what size I wanted of this bag, so I was excited to get to the store and try it on! I landed on the Cabarock Small Loubinthesky Perforated Tote Bag. The savings totaled $497, a 26% discount, versus purchasing the bag at home in Chicago. Yaaasss! See below.

	United States Dollar	Euros Converted to USD
Product Price	$1790	$1,578
Final Price: Plus Tax or Minus VAT	$1,901	$1,404

*Prices rounded to the nearest dollar.

                              

The Bottom Line

You can definitely win by buying luxury goods overseas. While I don’t buy enough luxury items to justify traveling to go shopping, I’m sure some people do! I’m just happy to have saved some money on my purchases over the last couple of years. It was a nice bonus on top of two amazing trips!

Click here to learn how I collected my VAT refund after my purchase in Milan.

Safe and Happy Travels,

Tamara