Outfit from this post
Shopping is always a treat in Europe, but with the Euro (and GPB) at a continued low relative to the dollar, some of the price differences on designer goods can be quite significant! If you plan on traveling there and have a particular item or two on your wishlist, it could be well worth it to wait and purchase abroad. In this post I wanted to share some general shopping tips, and for an upcoming post I'll have price comparisons on popular items (including what I got!), along with notes for shopping at specific stores like Hermes, Chanel, Celine, and such.
There's a few factors that affect the potential savings on your European shopping spree: geographical price differences, the current exchange rate, and everyone's favorite - VAT refunds. Making the most out of each requires just a little prep and research...
Some brands have minimized global price differences on items (after exchange rates are factored in), whereas others still have much lower pricing in certain countries. There's a few ways to find out local pricing in advance of a trip:
- Visit the brand's website and change the geographical location to that of your destination. If the brand does e-commerce (like Prada, Fendi, LV) this setting is easy to switch as the "shipping destination." If it doesn't (like Chanel, Celine), changing the language alone won't give you prices in local currency, so it might take a little maneuvering to fake your browser's geographical location.
*approx rates used: 6% US sales tax, 12% VAT refund
- You could also try calling or emailing a specific international boutique to ask.
There's nothing like hefty fees hacking away at a favorable exchange rate! Many credit cards charge 3% on foreign currency transactions, and those currency exchange kiosks at the airport have terrible conversion rates (no surprise) plus a fee per exchange.
Use a credit card without foreign transaction fees. There are several credit card review websites out there with comparisons on the best cards without such fees!
Choose local instead of home currency on credit card purchases (of course, this only applies if your credit card doesn't charge foreign transaction fees). When using a US-based credit card, sometimes at checkout in a foreign country you get the choice of being charged in the local vs. your home currency. This may seem enticing, however I've calculated the implied conversion rate a few times for home currency and it's always notably less favorable than the actual conversion rate.
Notify your credit card company of upcoming travels, to avoid finding your card frozen by the fraud monitoring department just as you're trying to purchase that dream bag!
Unlike in the US where tax is an additional amount charged at checkout, price tags on goods in the European Union countries already include a hefty tax (averaging around 20%) in the displayed price. Non-EU residents can get a portion of that tax (~ 12%) refunded on non-consumable merchandise. So for a purchase totaling 1000 EUR at checkout, you could receive 120 EUR back. Here's how to make sure you get that refund!
1. Make a qualifying purchase at a participating retailer. In France, in order to qualify for a VAT refund you need to spend a minimum of 175 EUR at one store (minimum threshold differs from country to country, and France has the highest!). All the bigger and chain stores I went into were well-versed in the VAT refund process, but I wouldn't be sure about smaller businesses - doesn't hurt to just ask.
2. Prior to checkout, tell the store associate that you need VAT refund paperwork. You'll need to show your passport to prove you're a non-resident, then receive an envelope with the refund paperwork along with a receipt. You'll receive a new envelope at every store you make a qualifying purchase.
3. Before leaving the European Union, show your purchases and get your paperwork stamped by customs at an airport tax refund counter. If you visit and shop at multiple EU countries, just make sure to have all your forms stamped prior to flying out of the last one. And if you're leaving by another means of transit like train or car, it could get a little tricky finding an office.
Make sure to allocate enough time before your flight, as the refund counters could be crowded or hard to find. Some of my purchases were successfully "stamped" by a quick kiosk, whereas for others I had to show the agent. You might also need to show the agent proof that your purchases are leaving the country, so if you packed your items in luggage that will be checked, do this prior to checking in. I've also been told to avoid wearing the merchandise at the airport in order to show that it is new.
Heads up: The tax-free counter at Charles de Gaulle airport can be an absolute zoo. Prepare to futilely swim to the front through a sea of tour group grandmas wielding 3 LV bags each. We've also flown out of Orly in Paris and I was literally the only person at that counter, which is oddly located on the arrivals floor (but downside: no good shopping at Orly while waiting for your flight).
4. Choose to receive your refund either immediately at the counter in cash, or via your credit card which takes about 3 weeks. If you choose cash, the amount is less (10.8% cash versus 12% on a credit card) and it's given to you in the local currency. On the plus side, you do get it immediately without risk of potentially never receiving it. Note most stores use a third party service (the main ones are Global Blue or Premier Tax Free) to facilitate the refund paperwork process. These intermediaries take a portion of the refund as a admin charge - the 10.8% cash and 12% credit card refund rates are what you're supposed to receive net after admin charges.
5. Mail the stamped paperwork (I usually find a mailbox at the airport). The envelopes should already be pre-paid for postage and have mailing addresses printed on them for the third party service offices. Both Global Blue and Premier Tax Free allow you to track the status of your refund online (so jot down your paperwork numbers), though I'm not sure how responsive they'd be to any inquiries of missing refunds.
Ted Baker coat & Celine box bag ~ two of my VAT-free souvenirs!
Compile a specific wish list and stick to it to avoid impulse purchases due to aimless browsing and VAT refund goggles ("oh...I know this $3,000 bag isn't the size or color or style I wanted, but its so much cheaper here than in the US!!"), especially ones that can't be returned. Most of my VAT-refund eligible purchases were stamped final sale.
Shop at department stores to more easily meet the VAT refund minimum. If you plan on buying an item that falls below the minimum purchase threshold, see if it's also available at a department store where you can buy items from multiple other brands in one place.
Use the store inventory system. If the store you're at doesn't have what you're looking for, politely ask your SA to help check whether any other nearby location does. Some brands (like H of course) may not allow this, but Celine, Goyard, Prada, Louboutin and a few others were all happy to when I asked. One Chanel SA said they could not share info on stock between stores, but others still did.
Shop for wishlist items early on in your trip. This allows max time to get an item if it's not in stock at the moment. For example, one store had an item I was looking for, but only at their warehouse outside of the city which would take a day to ship from. Or, if something is out of stock, sometimes SAs know of upcoming shipments arriving over the next few days. And last but not least, some stores offer complimentary alterations, adjustments, or monogramming on select products but the service might take a few days to complete.
Let me know if you have any questions on the above, and stay tuned for Part 2! I would also love to hear about your Europe shopping stories and tips, along with any great deals or memorable purchases from your trips!