Concerns about its was/now pricing has seen retailer 4WD Supacentre fork out $63,000 in penalties to the competition regulator, with a warning to other businesses about how they advertise discounts.
The ACCC said in a statement on Tuesday (14 December) that Outdoor Supacentre Pty Ltd, which trades as 4WD Supacentre, had paid the five infringement notices which related to allegedly misleading price comparisons on its website, and entered a court-enforceable undertaking to refrain from such conduct in the future.
According to the consumer rights watchdog, the retailer had advertised a range of its highest-selling products “with a high ‘was’ price and a low ‘now’ price”, which it said was despite the “was” price not having been used at all in the preceding three months.
“For example, 4WD Supacentre advertised a camp oven with a ‘was’ price of $279 and a ‘now’ price of $84, representing an apparent saving of $195. In fact, the camp oven had not been advertised at a price higher than $104 for the three-month period beforehand,” the ACCC said.
The regulator’s acting chair, Mick Keogh, expressed concerns this “was misleading consumers into thinking they could achieve significant savings with 4WD Supacentre, when this was not necessarily the case”.
Mr Keogh said the emphasis is on all businesses to “tell the truth” about any price discounts.
“All businesses should ensure they provide consumers with accurate price information, enabling informed choices by consumers based on potential savings and an even playing field for competing businesses which are doing the right thing,” he said.
The penalties paid by 4WD Supacentre follow similar ones issued to four furniture retailers including Oz Design and Plush in late 2019.
Payment of infringement notices issued by the ACCC does not necessarily constitute an admission of breaching consumer laws, the regulator noted.
According to its website, 4WD Supacentre has eight stores across Australia as well as dealers in every state (but not the ACT or the NT).
The retailer has been approached for comment.
‘Ensure that consumers are not misled’
A dedicated advertising and selling guide on the ACCC website states that businesses using price comparisons “must ensure that consumers are not misled about the savings that may be achieved”, which includes the previous price before one which was offered “for a reasonable period before the sale commenced”.
However, it concedes that “what’s considered to be a reasonable period in the circumstances will vary from case to case and will depend on the type of product or market involved and usual frequency of price changes for that product or in that market”.
“Every case will turn on its facts and it’s important to bear in mind that using ‘was/now’ or ‘strike-through’ pricing, where there were very little or no sales at the ‘was’ price, is likely to be a risky choice of advertising for businesses,” the website states, while encouraging businesses to seek legal advice.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.