Pricing regulations for rounded prices

Forums › Off topic › Pricing regulations for rounded prices

meesham

973 posts

Ultimate Geek

#273276 14-Aug-2020 08:34

A bit of an out there question - does anyone know what the rules are regarding showing a rounded price on online stores. So for example if the price is 44.4422 cents, if I was to show $0.44 (rounded) and the customer bought 100 of them, can we charge them $44.44? I really don't want to do this but it looks like I'm being pressured to do it from above so that it matches their ERP system.

kobiak

1615 posts

Uber Geek

Trusted

#2540689 14-Aug-2020 09:01

nope. it will be against the FTA.

we constantly have same issues while running discounts, promotions, etc. Some people are very cheeky and would complain about 1-2 c difference.

So our solution to always round up in customers favour.

helping others at evgenyk.nz

meesham

973 posts

Ultimate Geek

#2540707 14-Aug-2020 09:20

kobiak:

nope. it will be against the FTA.

we constantly have same issues while running discounts, promotions, etc. Some people are very cheeky and would complain about 1-2 c difference.

So our solution to always round up in customers favour.

That was my thought too, but I was told to show them where in the legislation it says you can't do it (even though I'm not a lawyer...)

kiwiharry

1030 posts

Uber Geek

ID Verified

Subscriber

#2540715 14-Aug-2020 09:28

As a customer, I would rather see an individual unit price that is round up; so in your instance shows online unit price as $0.45 and then be charged the slightly lower amount on check-out.

If you can't laugh at yourself then you probably shouldn't laugh at others.

Bung

6477 posts

Uber Geek

Subscriber

#2540718 14-Aug-2020 09:30

Round down in customer's favour surely?

Rounding is usually on total not individual items and the amount would depend on method of payment.

It's the fault of electronics. Once upon a time all you had to worry about was the weight of the butcher's thumb on the scale 😁

Handsomedan

7281 posts

Uber Geek

ID Verified

Trusted

Subscriber

#2540742 14-Aug-2020 09:44

Is there not a disclaimer you can use such as "We use Swedish Rounding so when you get to checkout it'll say 'Hurr De Durr ur Flurgen Durgen' " or similar?

Handsome Dan Has Spoken.
Handsome Dan needs to stop adding three dots to every sentence...

Handsome Dan does not currently have a side hustle as the mascot for Yale

*Gladly accepting donations...

freitasm

BDFL - Memuneh
79250 posts

Uber Geek

Administrator

ID Verified

Trusted

Geekzone

Lifetime subscriber

#2540757 14-Aug-2020 10:03

From https://comcom.govt.nz/consumers/dealing-with-typical-situations/buying-goods-and-services/pricing there's a PDF that basically says:

"Businesses must price goods clearly to make sure consumers are not misled. When a customer sees a price sticker on a good or a shelf price, it is reasonable for them to expect that that is the price they will be charged at the checkout. A business that displays prices which are lower than the actual price at which they are selling goods or services is misleading consumers about the true cost of goods."

This is from the FTA.

Basically, if the display is $ 44.44/unit but the business actually charges $ 44.4422 per unit then the price is wrong and falls in the "A business that displays prices which are lower than the actual price at which they are selling goods or services is misleading consumers about the true cost of goods."

It would be better to show $ 44.45/unit and charge the actual $44.4422 per unit (when buying multiple quantities), then apply the rounding on the total.

Their internal systems are no excuse to break the FTA.

IANAL.

meesham

973 posts

Ultimate Geek

#2540765 14-Aug-2020 10:10

freitasm:

From https://comcom.govt.nz/consumers/dealing-with-typical-situations/buying-goods-and-services/pricing there's a PDF that basically says:

"Businesses must price goods clearly to make sure consumers are not misled. When a customer sees a price sticker on a good or a shelf price, it is reasonable for them to expect that that is the price they will be charged at the checkout. A business that displays prices which are lower than the actual price at which they are selling goods or services is misleading consumers about the true cost of goods."

This is from the FTA.

Basically, if the display is $ 44.44/unit but the business actually charges $ 44.4422 per unit then the price is wrong and falls in the "A business that displays prices which are lower than the actual price at which they are selling goods or services is misleading consumers about the true cost of goods."

It would be better to show $ 44.45/unit and charge the actual $44.4422 per unit (when buying multiple quantities), then apply the rounding on the total.

Their internal systems are no excuse to break the FTA.

IANAL.

Thanks, this is exactly what I was trying to find (and how I thought it should work).

Equinox IT

Cloud spending continues to surge globally, but most organisations haven’t made the changes necessary to maximise the value and cost-efficiency benefits of their cloud investments. Download the whitepaper From Overspend to Advantage now.

Bung

6477 posts

Uber Geek

Subscriber

#2540766 14-Aug-2020 10:13

meesham:
That was my thought too, but I was told to show them where in the legislation it says you can't do it (even though I'm not a lawyer...)

Considering that attitude I'd be careful checking your pay sheet.

meesham

973 posts

Ultimate Geek

#2540767 14-Aug-2020 10:16

Bung:
meesham:

That was my thought too, but I was told to show them where in the legislation it says you can't do it (even though I'm not a lawyer...)

Considering that attitude I'd be careful checking your pay sheet.

Believe me, I do.

They still think showing "rounded" next to the unit price is their out, I'm not sure how far I'm going to push back.

Kyanar

4089 posts

Uber Geek

ID Verified

Trusted

#2541601 15-Aug-2020 13:42

meesham:

Believe me, I do.

They still think showing "rounded" next to the unit price is their out, I'm not sure how far I'm going to push back.

It's not, because it doesn't show what it was rounded from. The only legal way to do what they want is to just not round the display price, and apply the rounding at time of sale instead - you know, like petrol stations who also charge in fractional cents do. Simply saying "rounded" is not enough.

This would to me seem to be a breach of s19 of the FTA (as they have no intention of supplying the goods at the advertised price), as well as s9 for being misleading or being likely to mislead (key there being that it doesn't have to be deliberately misleading, just likely to mislead someone).

sbiddle

30853 posts

Uber Geek

Retired Mod

Trusted

Biddle Corp

Lifetime subscriber

#2541734 15-Aug-2020 15:35

Rounding is still something that is done wrong by so many people.

One classic example are the many farmers / vege markets around the place. As most retailers simply add up pricing in their head for a running total it's pretty common for many to use Swedish rounding for each product when weighted whereas the law says you are not allowed to round each product, and only round the total.