A $100 gift voucher will be available to a number of customers of a national bedding and furniture retailer after Australian Competition and Consumer Commission intervention.
Furniture and Bedding Concepts Ltd, which owns and operates 107 retail stores under the Sleep City and Everyday Living brands, has offered the voucher to those customers who were likely to have been misled by comparison pricing claims that appeared in its Spring '08 catalogue.
During August and September 2008, Sleep City and Everyday Living published a Spring '08 catalogue, promoting a range of bedding and furniture products using price comparisons in the form of 'Now $X, Save $Y'.
The 'save' amounts in the catalogue were determined by reference to Sleep City and Everyday Living's own internally-set recommended retail prices, not the prices at which the products were offered, or sold, for a reasonable time immediately before the sale.
Sleep City and Everyday Living admitted that the 'Now $X Save $Y' catalogue representations did not accurately reflect the actual savings available for many of the catalogue items during the sale and were likely to breach the Trade Practices Act 1974.
Upon being made aware of the ACCC's concerns, Sleep City and Everyday Living stopped the conduct and offered court-enforceable undertakings to:
- refrain from making false, misleading or deceptive representations with respect to the price of goods
- display corrective notices in its retail stores and on its websites
- publish an information notice in an industry magazine, and
- strengthen its existing trade practices law compliance program.
Additionally, Sleep City and Everyday Living will offer a $100 gift voucher to customers who purchased a catalogue item promoted by 'Now $X, Save $Y' pricing during the Spring '08 sale. Sleep City and Everyday Living have undertaken to write to those customers which it knows to be eligible for a gift voucher.
Customers who consider that they may be eligible to receive a gift voucher but have not heard from Sleep City and Everyday Living by 8 July 2009 are invited to contact them on (03) 8761 2200 with their inquiries.
The conduct of Sleep City and Everyday Living came to the ACCC's attention following a coordinated and proactive review by the ACCC and State and Territory Offices of Fair Trading of the two-price advertising practices of a number of bed retailers across Australia.
"Two-price advertising can be a very powerful tool in advertising and is designed to encourage consumers to buy a product by implying that the current price is less than they would pay outside a sale period," Acting Chairman, Mr Peter Kell, said today. "However, retailers must ensure that the claimed savings are genuine or they run a serious risk of breaching the law.
"The ACCC was pleased that Sleep City and Everyday Living cooperated with the ACCC during its investigation and offered redress to consumers who may have been affected."
The ACCC has developed its guidance to business on price comparison, or 'two-price', advertising in response to recent relevant court decisions.
The new guidance is now available as a News for Business leaflet on the ACCC's website. Printed copies of this leaflet will be available from the ACCC in late June 2009. Business groups seeking multiple printed copies should contact the ACCC Infocentre on 1300 302 502.