In New Zealand, “Sale” Had Better Mean Sale

June 18, 2007  by in UnCategorized   

By Home Furnishings Business in Furniture Retailing on June 2007 If you’re planning on opening a store in New Zealand, best watch what you call a sale.

From our international desk today, an Auckland, New Zealand, leather furniture retailer has been fined a total of NZ$36,000 over misleading claims about the ‘sale’ price of furniture.

In Auckland District Court Tuesday, 230 Marua Limited was found guilty on six charges of breaching the New Zealand Fair Trading Act by advertising furniture as being “on sale” when the price was the same before, during, and after the “sale”; and claiming that leather lounge suites on sale for NZ$3,000 were sold by other retailers for NZ$6,000 when this was not correct.

Commerce Commission Director of Fair Trading Deborah Battell said that any claims about so-called sale prices must be accurate and that comparisons about the prices charged ‘elsewhere’ must be accurate.

In this case, 230 Marua company director Naresh Shukla had shown customers copies of leather lounge suites advertised by other retailers including Harvey Norman, Farmers and Danske Mobler, comparing his prices with theirs.

“Mr. Shukla claimed that customers would pay (NZ)$6,000 elsewhere for a leather lounge suite that only cost (NZ)$3,000 at 230 Marua, but the Commission found that the more expensive leather lounge suites sold by other retailers were better quality,” Battell said. “By making this comparison, the company was clearly intending to gain a competitive edge over other companies.”