Last updated 10:49, May 11 2017
Sergey Nivens 123RF
Claiming that prices are discounted which they are actually the usual price is deceptive and unfair, the Commerce Commission says. Retailers have been put on notice that they cannot mislead consumers when holding a sale. The Commerce Commission has fired a warning shot over the practices by publishing an open letter to retailers which highlights breaches of the fair trading laws.
The biggest single complaint to the commission last year was about pricing and sales that were not really a bargain.
SCOTT HAMMOND/FAIRFAX NZ
Bunnings Warehouse remains in the gun over its lowest price claims
Claims of having the “lowest” and “cheapest” prices had to be true, said commissioner Anna Rawlings.
* Bike Barn indicates it will plead guilty to charges
* The Warehouse accused of ‘bait advertising’ in sofa sale
* Customer compensation question after Trustpower fined $390,000 over misleading adverts
* Bunnings pleads not guilty on 45 charges of false and misleading advertising1234
LIBBY WILSON/FAIRFAX NZ
Trustpower was fined last year for playing down the terms of a power and broadband offer.
Sales could drive competition, and it was unfair to those offering genuine specials when prices were not accurate or discounts were exaggerated, she said.
“We are concerned that some retailers may be misleading consumers about the savings that they offer.” she said. A common complaint was retailers offering deep discounts which turned out to be the usual selling price. Sales that were meant to be “for limited time” when they were not was another problem, as was using fine print to hide important information such as extra charges.
“Clearance” sales had to only be for clearing goods, and retailers could not exaggerate savings or the range of goods that were on special.
While the commission preferred to improve compliance through education, Rawlings warned it would prosecute if necessary. Recent big penalties included an $800,000 fine given to the two Bike Barn companies for advertising bikes at “half price” when in fact they were usually sold at that price, and for selling bikes at clearance price after the limited time. Trustpower was required to pay $390,000 for misleading advertising about the terms of a bundled electricity and broadband offer.
And in February, 45 charges were laid against hardware chain Bunnings in relation to its lowest price guarantee.
In 2015, several businesses including Air New Zealand, House of Travel and Nakedbus ended a practice called “opt out” pricing following a commission investigation.
Next Money story:
Mum who loaned daughter $360k says ‘it’s all terrible’6
- ^ Bike Barn indicates it will plead guilty to charges (www.stuff.co.nz)
- ^ The Warehouse accused of ‘bait advertising’ in sofa sale (www.stuff.co.nz)
- ^ Customer compensation question after Trustpower fined $390,000 over misleading adverts (www.stuff.co.nz)
- ^ Bunnings pleads not guilty on 45 charges of false and misleading advertising (www.stuff.co.nz)
- ^ Ad Feedback (stuff.co.nz)
- ^ Mum who loaned daughter $360k says ‘it’s all terrible’ (www.stuff.co.nz)
- ^ Business Homepage (www.stuff.co.nz)