The Australian Competition and Consumer Commission (ACCC) has set its policy agenda for 2014, with the competition regulator setting its sights on deceptive online pricing and low-cost imports as two major issues facing the retail industry this year.
Launching the ACCC’s Compliance and Enforcement Policy for 2014 today, chairman Rod Sims called out a number of problem areas in the Australian consumer landscape, including scams, so-called “discounts of what?” in the energy and telecommunications sector (whereby door-to-door sellers make claims about potential savings), and credence claims (including product claims of being ‘Australian made’ or ‘free range’).
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A major focus for the ACCC, and one that has the potential to make major waves in the appliance industry, will be the increased focus on product safety, particularly with regards to low-cost imported goods.
The ACCC’s Recalls website is constantly updated with recalls of faulty products that have been sold in Australian retail stores, and low-quality appliances figure prominently in these lists. Last year alone, 41 electrical products were recalled across Australia, with a number of big box retailer home brands appearing a number of times, including Big W’s much-maligned Abode brand.
Speaking about product safety, Sims said:
As Australia’s product safety regulator we are always busy in this area. For example, in 2012-13 some 174 matters were investigated for possible non-compliance with safety standards or bans. We surveyed products from over 3,300 retailers, resulting in the removal from sale or seizure of over 29,000 products.
The ACCC also published details of 450 recalls, of which 91 were put in place by direct negotiation by the ACCC.
Product safety is a continuing priority for the ACCC. This year we will, in particular, focus on low cost imported goods sold in our major stores.
While Sims comments apply to the broader retail community, they serve as a timely reminder for the electrical retailing industry and those retailers and suppliers who import appliances into the Australian market. Appliance Retailer has sought further comment from the ACCC on the regulator’s enforcement plans in this area for 2014.
Another major focus for the ACCC will be the disruption of misleading retail comparison websites, as well as what it calls “drip pricing”. A particular issue in online retail, drip pricing “involves the incremental disclosure of fees and charges” that may see a consumer thinking they’re buying a low-priced product, only to have additional costs added on through the buying process resulting in a higher final cost.
Chairman Sims said:
Consumers see a ‘headline’ price advertised at the beginning of the booking process but when they progress to the payment phase, additional fees and charges have been added. Consumers purchasing airfares or sporting event tickets are all too familiar with this practice. Drip pricing involves a lack of transparency which may mislead consumers, and it can also make it difficult for businesses to compete on a level playing field.
