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Marketing Cost Savings and Disclaimers That Should Be Used document sample
Marketing Cost Savings and Disclaimers That Should Be Used document sample
RFlash Pl ea se Pa sso n to : etail Lay-bys— top 10 tips A s a retailer are you interested in knowing your rights and responsibilities under the Trade Practices Act? Do you want to keep on the right side of the Here are some tips on good lay-by practices that will put yours and your customers’ minds at ease. These tips are provided with the kind permission of Consumer and Business Affairs Victoria. If you want to understand your legal Australian Competition and Consumer Commission obligations contact your State or Territory fair trading department (ACCC) and your customers? or retailers association. If the answers are yes, then the contents of this newsletter The GST will apply to lay-bys. Contact the ACCC or check out its are essential reading. GST website for information. The Retail Flash is a joint production of the ACCC and the ! The lay-by statement you give to customers should include a Australian Retailers Association. If you think that this newsletter description of the goods, and in Victoria the statement should would be useful as a regular series please let us know. be signed by you and the purchaser. Email: firstname.lastname@example.org ! The statement should detail the price of the goods. or phone your nearest ACCC or ARA office. ! The statement should include the first payment made and the balance outstanding. Contents ! The statement should detail when other payments are due. Lay-bys — top 10 tips 1 ! The statement should outline any cancellation charge, or how GST pricing information 1 such a charge will be calculated. ! The customer can cancel a lay-by before the goods are To refund or not to refund 2 delivered, or if the goods are delivered in a damaged state The Australian Retailers Association 2 (which has not been brought to the customer's attention). ! The cancellation charge should be reasonable. How much are your customers worth? 2 ! The supplier should refund the money as soon as possible, Consumer friendly websites 3 minus any cancellation charge. How to advertise and sell — and stay honest 3 ! The supplier can only cancel a lay-by if it stops trading, if the customer breaches the contract, or if the goods are no longer Are you a franchise? 3 available. Unconscionable conduct 4 ! If the supplier cancels the lay-by then all money should be refunded and no cancellation fee charged (unless it is a breach Contacts and more information 4 by the customer). GST pricing The ACCC has developed a range of information Retail Price Adjustor are software packages The series targets micro-business, but will be publications to help you understand your which you can use to help you identify the a useful resource for all businesses. Topics to obligations when adjusting prices to take levels of savings you can expect on a range come include: price display; adjusting prices account of the New Tax System changes. of business expenses, adjust your prices, and correctly; transition to GST prices; pricing convert your old tax system prices to New claims; identifying savings; record keeping; Pricing Kit for Small Business Tax System GST-inclusive prices. Copies of and handling complaints. The Pricing Kit for Small Business has three the Pricing Kit will be available from the components: A Compliance Guide, a Cost ACCC's GST website and on a business card- News for business Savings Estimator, and a Retail Price Adjustor. sized CD ROM. The Compliance Guide will This series addresses topical issues, focusing The compliance guide explains the ACCC's on industry-specific matters. Topics already 1 also be available in a B5-size booklet. guidelines on price exploitation in detail, and covered include transitional issues, pricing provides numerous illustrations and practical Small business GST checklists claims and lay-bys. Upcoming issues will examples of the concepts in the guidelines. A series dealing with compliance issues in a include: road transport; travel and tourism; It can be used as a reference manual short, easy to apply format that will help you cost savings to business; price points and throughout the transition to the New Tax tick off compliance measures as you rounding; and pricing for jewellers. System. The Cost Savings Estimator and complete them. Retailers Newsletter To refund or not to refund? GST pricing information (continued from page one) All goods and services sold by retailers, service providers and manufacturers are covered by a Trade Practices Act statutory Price expectation information. warranty that can’t be limited and that provides minimum refund The ACCC will also publish information on expected price changes entitlements for consumers. i.e. up or down, and the expected percentage change) for about 200 major household items. While aimed at consumers, this As part of good business practice some manufacturers offer their information will also help businesses by giving price movement own additional or voluntary warranty. Both must be honoured. indications. A refund is required when the goods: ! don’t meet a basic level of performance, taking into consideration the price and description; ! don’t perform the intended purpose; The (ARA) ! don’t match the description or sample; and Australian Retailers Association ! have hidden defects that affect the quality or performance. The Australian Retailers Association (ARA) is the national voice representing the retail industry. Its 12 000 members operate over A refund is not required when the fault was caused by: 40 000 retail outlets across the nation, making it one of the largest employer/trade organisations in Australia. The members ! something the customer failed to do; transact an estimated 75 per cent of the nation’s retail sales and ! the problem could have been expected given the quality, employ about three-quarters of the retail workforce. age and price of the goods; At least 90 per cent of our members are small businesses, ! customers simply change their minds or find they can get the employing less than 20 staff. ARA offers a variety of services to goods cheaper elsewhere; members including advice on wages and employment conditions, assistance with workplace agreements/enterprise bargaining, ! there is a fault that was brought to the customer’s attention advice/consultation on retail legislation, tenancy, GST, staff before purchase; and training, the Internet and more. We also monitor laws and consumer advice on refunds, tenancies, lay-bys, credit and ! a manufacturer’s reasonable instructions have not been product safety laws. followed or the goods have been misused. We are there for the retail industry and will help you work on your business rather than in your business. Tips National contact details Canberra 02 6283 5200 Brisbane 07 3251 3000 Sydney 02 9290 3766 Establish clear refund and warranty policies, and make your staff aware of those policies. Check that Melbourne 03 9326 5022 they meet the minimum requirements above. Adelaide 08 8419 2222 Ensure that your staff do not offer refunds beyond Perth 08 9365 7695 your store’s refund policy (for example, if your store does not offer refunds if customers simply change Hobart 03 6234 2800 their minds, then your staff should not tell your customers otherwise). Darwin 08 8981 5755 Make sure store signage does not mislead customers or visit www.ara.com.au about their right to a refund. Draw product defects to your customer’s attention, and note the defects on the sales docket. How much 2 Ensure the product is suitable for what the customer are your customers worth? intends and they are aware of care instructions and performance expectations. Calculate how much each customer is worth to your business — ($ turnover against the number of transactions multiplied by average gross profit). Would you give away even a single customer to make an additional 1 cent profit? Retailers Newsletter How to advertise and sell — and stay honest How much are your customers worth? (continued) Although it’s been 10 years since ! The Trade Practices Act and similar legislation in each State 1&2 cents rounded down 1 and 2 cent coins were removed from and Territory set out laws about advertising and selling. Here to the nearest 10 circulation, the guidelines for rounding are some marketing essentials to help you understand the transactions haven’t changed. 3&4 cents rounded up principles behind the law. to the nearest 5 Cheques, credit cards and point-of- ! Make sure that you, your staff and your representatives don’t sale electronic funds transfer should be 6&7 cents rounded down mislead or deceive customers. It doesn’t matter whether the to the exact cent on the total sale. to the nearest 5 misrepresentation is deliberate or accidental; it’s the impression left in the customer’s mind that counts. Cash transactions should be rounded 8&9 cents rounded up to the nearest 5 or 10 cents on the to the nearest 10 ! Don’t make false or misleading representations about a total sale, not individual items. product's value, price, quality, place of origin or impact on the environment. Perception is reality Customers who experience poor rounding practice often equate ! Speak up if you think that your customer needs to know it to poor service. Poor service equates to less return business, something more about your product or service so that they less profits, and bad word of mouth. won’t be misled. Customers still complain when businesses round up on each item ! Seek legal advice if you think a competitor is making rather than on the total. You may not hear the complaints and damaging and unfair comparisons with your product or don’t know how many never return, but bad rounding practice service, or is engaging in other forms of misleading conduct. will damage your business. You have rights too, and you may be able to stop the competitor’s conduct. On top of all that you may well be misleading or deceiving customers because individual rounding is illegal. ! Focus on the overall impression you give your customers, especially when you use techniques such as asterisks and Consumer friendly associated fine print. Disclaimers should be specific, clear and highly visible. websites ! Advertising, shop tickets and signs using price comparisons Is your business developing an on-line presence? If it is you should must be realistic. The prices you use must be genuine and be doing whatever you can to overcome consumers’ concerns relevant. You must have made the goods available at the about buying over the Internet by displaying information that pre-sale price for a reasonable period before using this reassures them of your integrity and security measures. technique. Your website needs to comply with the Trade Practices Act in the ! You must reveal the total cash price to your customers before same way that any other advertising and selling practices do. purchase, not just deposit and instalment amounts. Your website should: ! Special offers to draw customers to a store should be made ! provide clear information about who you are and only if they have a fair chance of purchasing the advertised your location; goods. It’s a good idea to offer rain checks if demand exceeds your expectations. ! provide clear explanations of policies on refunds, warranties, complaints handling and delivery arrangements; ! Don’t accept payment if you know, or should know, that you can’t provide the kind of goods or services promised. ! provide a clear and accurate description of the goods or services you are selling; ! provide a plain explanation on how you will treat their personal information; Are you a franchise? If you are you should be aware that the government has ! provide a simple explanation about the security level introduced a Franchising Code of Conduct that has the force of of your site for on-line transactions; and law; it outlines the rights and responsibilities of franchisees and ! if you are using framing, linking or disclaimers — ensure that franchisors. consumers are able to make fully informed decisions about It applies to a franchise agreement entered into, renewed or entering into on-line transactions by making reference to the extended on or after 1 October 1998. above information at all stages. For example, disclaimers should be compulsory viewing. If you are not sure if you are a franchise you need to look 3 at your business relationship to see if you have a franchise Your website should not assume that consumers will follow every agreement. link and read every page. If important information such as terms and conditions of a contract or disclaimers are buried deep, your The definition of a franchise agreement is found in clause 4 of the site may risk being misleading about the nature of your goods or code. For your agreement to be classified as one it must contain services. the following four elements. are you a franchise ? (continued) 1. You must have an agreement (which may be written, If this fails find out if the other party has a complaint handling oral or implied). process. If not, then suggest a mediation service. Most major cities have mediation service providers and you can find them in 2. There must be evidence of a system or marketing plan the yellow pages. Mediation is a quick and cheap way of dealing that has been suggested or is controlled by the with matters that can help to keep relationships intact. franchisor or an associate in your business. Examples of a system or marketing plan may include Victims of extreme business behaviour may be protected by specific instructions from the franchisor on how to section 51AC of the Trade Practices Act and an option to resolve advertise and sell goods or services. the matter is to take it to court. 3. Your business must be associated with a symbol or a It’s advisable to remember, though, that the courts may not agree trade mark (which may include the franchisor’s logo the behaviour is unfair or unconscionable. A court may decide or trade name). that it’s legitimate commercial behaviour, given all the circumstances. 4. You must pay a fee or agree to pay a fee to the franchisor of the type prescribed in clause 4 of the code. (Examples of fees include up-front franchise fee or royalties.) For more information The code does not apply to a franchise agreement are when: contact any ACCC office ! an overseas franchisor uses only one franchise or master franchise in Australia; or Canberra (02) 6243 1111 ! the agreement is covered by another mandatory code; or Brisbane (07) 3835 4666 ! sales under your franchise are likely to provide no more than 20 per cent of your gross turnover for the first year Townsville (07) 4771 2712 of the franchise, and you have been supplying the same Sydney (02) 9230 9133 goods and services for two years immediately before entering the agreement. Tamworth (02) 6761 2000 If you meet all four requirements and do not qualify for any of the Melbourne (03) 9290 1800 exceptions then you are a franchise and the Franchising Code applies to your business. Adelaide (08) 8205 4242 Perth (08) 9325 3622 Hobart (03) 6234 5155 Darwin (08) 8943 1499 Unconscionable All publications mentioned are available, conduct or will be when they are published: ... and how would you handle it? ! from any ACCC office; Unconscionable conduct is extreme behaviour where a business ! on either the ACCC’s main website takes severe advantage of its bargaining power over a smaller http://www.accc.gov.au party with which it has a commercial relationship. or its dedicated GST website http://gst.accc.gov.au How to assert your rights and continue ! the ACCC’s GST hotline on 1300 302 502 or the relationship If you are yet to sign the contract and think the terms are too ! from your local representative organisation. harsh then don’t sign. If you’re in doubt, seek independent expert advice. Business associations can contact the GST hotline to join the Business Information Network that provides free If you already have a contractual relationship and a dispute arises: copies of GST publications. Some are available in hard ! discuss it with the party involved — don’t delay or let copy and some in electronic. 4 problems worsen; ! make it clear what action you require to settle the dispute; and ! put your concerns in writing to the other party.
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