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Topic # 185896 9-Dec-2015 10:08
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It happened then...


Retailers reminded to avoid misleading consumers with exaggerated discounts

The Commerce Commission is reminding retailers of their responsibilities as the holiday shopping season heats up.

"December is the busiest month of the year for retail sales and with online sales growing significantly, there is even greater competition in the market. Big sales and discounts are good for consumers and are an increasingly common feature of the retail industry in New Zealand. However, retailers need to ensure they are aware of their responsibilities under the Fair Trading Act. They need to make sure that advertised discounts offer a genuine saving and that their point of sale systems properly deliver the discount when the customer pays," said Commissioner Anna Rawlings.

The Fair Trading Act prohibits misleading and deceptive conduct and is designed to protect both consumers and competing businesses. Retailers need to take particular care when comparing a ‘special’ or discounted price with a previous or ‘usual’ price (such as ‘was $100, now $65’). Consumers could be misled if the retailer:

• does not usually charge the "was" or “previous” price;
• has inflated the usual price to exaggerate the discount or to attract customers by offering the goods at a discounted price;
• uses an “RRP” for price comparison purposes, where the RRP is not genuine or is not the seller’s usual price;
• sells products repeatedly and/or for extended periods at a promotional price but still claims it is a discounted price.

The Commission has previously warned and prosecuted retailers for misleading consumers in this way. In 2012, a supermarket company was issued with a warning for claiming customers could save "at least 20%" or "at least 25%" off all beer in a special promotion. However, it had been 32 weeks since the shelf price had been displayed for some products and the claimed saving of 20% off was misleading, as the product had been sold at a lower price for that period.

"We encourage retailers to take particular care when creating promotions, so that they deliver genuine discounts and charge correctly at the point of sale. For consumers, we advise they shop around and search online, to find out the usual pricing of goods before buying. That way, consumers will be able to know if a "special" price is really a good deal. Read reviews and seller feedback, to make sure you are dealing with reputable sellers and products. And if you are borrowing to fund the purchase, make sure you get good information about the total cost of the purchase once all repayments, interest and fees are included. These can add significantly to the price of a discounted purchase,” said Ms Rawlings.

Consumers who believe they have been misled by retail advertising or other sales practices can contact the Commission on 0800 943 600 or via their website – www.comcom.govt.nz




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  Reply # 1444366 9-Dec-2015 10:53
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Oh PBtech breaks a number of these that I have called them out on yet they still do it.
Their RRP's and normally not correct and they increase them to make the discount look bigger.  I called them out on a LG watch R that everyone was selling for the RRP of $400 (or so) when they were release yet PBtech said the RRP was $649



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  Reply # 1444501 9-Dec-2015 14:26
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tripp: Oh PBtech breaks a number of these that I have called them out on yet they still do it.
Their RRP's and normally not correct and they increase them to make the discount look bigger.  I called them out on a LG watch R that everyone was selling for the RRP of $400 (or so) when they were release yet PBtech said the RRP was $649





Why didn't you report them to the commerce commission then? If they aren't playing fair they need to be slapped over the hand for it.

 
 
 
 


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  Reply # 1446799 9-Dec-2015 22:01
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How about voiding the warrantee of a product unless an unfavourable review was removed? Some companies just don’t understand either customer service or the law.

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  Reply # 1446811 9-Dec-2015 22:26
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Bike Barn.  Enough said.

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  Reply # 1446813 9-Dec-2015 22:38
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Godfreys?

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  Reply # 1446816 9-Dec-2015 22:38
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Lenovo........shockers, but , they get away with it. 



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  Reply # 1446819 9-Dec-2015 22:52
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freitasm:

The Commission has previously warned and prosecuted retailers for misleading consumers in this way. In 2012, a supermarket company was issued with a warning for claiming customers could save "at least 20%" or "at least 25%" off all beer in a special promotion. However, it had been 32 weeks since the shelf price had been displayed for some products and the claimed saving of 20% off was misleading, as the product had been sold at a lower price for that period.



Holy crap - once upon a time, a long time ago, someone got issued with a warning?

I think I can truly schmell the scent of fear that CommCom's campaign is generating...  Oh wait - it was just the dog farting.  Toothless mutt.


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  Reply # 1446831 10-Dec-2015 00:02
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In the past I have reported a company to them before. They basically told me after several weeks of waiting,  that from the information I provided to them, it was possible the company breached the FTA, but they wouldn't taken any further action, and I should take my own action via the disputes tribunal. So IMO it is a bit of a waste of your time reporting a company, life is simply too short. My impression is that they simply don't have the resources to look into every complaint.

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  Reply # 1446858 10-Dec-2015 06:16
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mattwnz: In the past I have reported a company to them before. They basically told me after several weeks of waiting,  that from the information I provided to them, it was possible the company breached the FTA, but they wouldn't taken any further action, and I should take my own action via the disputes tribunal. So IMO it is a bit of a waste of your time reporting a company, life is simply too short. My impression is that they simply don't have the resources to look into every complaint.


Yes this is what happens when I have reported companies, there have been a couple of big issue in the last year that the companies just got a "warning" when they should have had fines etc.

Each time I have reported to the ComCom it has replied about a month later with a "do it yourself" answer.
The thing that really gets me however is then the companies have another sale and it's right back to what they were doing before.
Best 1 I have seen is a object for a set amount, then 1 week before a sale the price goes up then it "goes on sale" at the price it was before.  A number of you will know who I am talking about.


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  Reply # 1446862 10-Dec-2015 07:04
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Stan: Godfreys?


I haven't been to the Harvey Norman site in Lower Hutt for probably 6 months, but Godfrey's have had a big SALE sign hanging outside their store for the past 3 or 4 years!


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  Reply # 1446864 10-Dec-2015 07:12
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With the obsession by NZ customers of refusing to pay "full retail" for something the retail industry is in a real crossroads. Kathmandu screwed the industry for good, but they're now suffering badly.

If you shop at stores like Briscoes, Kathmandu, or even (to an extent Farmers) and buy something with anything less than a 50% discount the reality if you're being ripped off. It really shows the mentality of so many NZers when they can't realise that the everyday profile prices are being heavily inflated to support the discounting.

The Commerce Commission is very clear around what can and can't be a "sale" and that goods need to sell at a normal price for specific periods of time for a discount to be genuine. IMHO these rules need to be updated because of the abuse from companies such as those above. If you can offer 50% off a product every 3rd week (something that's perfectly legal right now) it really shows the price is being inflated in the first place.


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  Reply # 1446866 10-Dec-2015 07:14
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sbiddle: With the obsession by NZ customers of refusing to pay "full retail" for something the retail industry is in a real crossroads. Kathmandu screwed the industry for good, but they're now suffering badly.

If you shop at stores like Briscoes, Kathmandu, or even (to an extent Farmers) and buy something with anything less than a 50% discount the reality if you're being ripped off. It really shows the mentality of so many NZers when they can't realise that the everyday profile prices are being heavily inflated to support the discounting.

The Commerce Commission is very clear around what can and can't be a "sale" and that goods need to sell at a normal price for specific periods of time for a discount to be genuine. IMHO these rules need to be updated because of the abuse from companies such as those above. If you can offer 50% off a product every 3rd week (something that's perfectly legal right now) it really shows the price is being inflated in the first place.



I understand what you mean.  I see "sales" now for 20% - 30% off and think "oh it will be the same or more in a couple of weeks I'll get it then".

I guess that is why I am disappointed in most sales these days.



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  Reply # 1446870 10-Dec-2015 07:31
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tripp:
I understand what you mean.  I see "sales" now for 20% - 30% off and think "oh it will be the same or more in a couple of weeks I'll get it then".

I guess that is why I am disappointed in most sales these days.




I noticed Farmers advertising a 50% off a lot of stuff today incl all mens clothing. This is probably the 3rd time in the last 2 months they've had this.

Why would you bother buying anything outside these sale periods?



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  Reply # 1446917 10-Dec-2015 08:56
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Yep, it is all screwed up.

These stores (I'm thinking Briscoes/Rebel mainly) have to show they have had something available for the 'original' price so they can then show a "massive" saving. So they then have 3 or 4 days a week not on sale, and the weekend or some other day with 50-80% off or whatever.

Who would shop in those stores when the sale isn't on? They may as well close? I find it insulting, but people still stream into their stores for a bargain, so they keep doing it.

Harvey Norman are just as bad - especially those stupid 'lift the bag to see the price "sales"'

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  Reply # 1446933 10-Dec-2015 09:23
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trig42: Yep, it is all screwed up.

These stores (I'm thinking Briscoes/Rebel mainly) have to show they have had something available for the 'original' price so they can then show a "massive" saving. So they then have 3 or 4 days a week not on sale, and the weekend or some other day with 50-80% off or whatever.

Who would shop in those stores when the sale isn't on? They may as well close? I find it insulting, but people still stream into their stores for a bargain, so they keep doing it.

Harvey Norman are just as bad - especially those stupid 'lift the bag to see the price "sales"'


But a good proportion of this stream will be made up of people who are exactly those you mention in an earlier sentence - those who know not to purchase at any other time than when there's a 'sale' on. So, sure, there will be a proportion who are under the impression they're getting a bargain, but there'll also be many (including myself and most on this forum I bet) that will simply time their purchases to times of regular discounting.

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