retail finretail finance nance Point of sale issues of the BBC tof sale issues


Point of sales practices also came under fire in Which? r


oint of sales practices also came under fire the Which? report and were the main thrust of the BBC’s Watchdog programme. Currys stores were at the centre of the TV show’s complaints, comparing how warranties were sold against the claims experiences of one o


t and w e the main thrust chdog pr


..C C es we e at the centre of the V show


complaints, comparing how warranties w r sold against the claims experiences of one or two disgruntled custro disgruntled customers. One cu


ell against his lete vision, smashing the screen and dripping paint on the back of the set. Currys turned his claim down as they said the damage wasn’t consistent with an accident, and that he wasn’tcov ed under the polic


One customer was decorating his front room, lost his balance on the stepladder and ffe


ust


oom, lost his balance on the stepladder and ell against his television, smashing the screen and dripping paint on the back of the set. ys turned his claim down as they


said the damage wasn’t consistent with an accident, and that he wasn’t covered under the policy.


products utouc pr


products out therutthe Kevin Gillan, md of w


Th ree rere are lot of re here


There ar


The report cites the fact that with most products you already get a manufacturer’s warranty of one or two years, while the Sales ofars, while the Sales of Goods Act gives you rights to return a product if it develops a fault, and your home insurance ffe


Kevin Gillan, md of warrra tyantty The r


t cites the fact that ‘with most


ts you already get a manufac y of one or t o yea


Goods A t g es you rights tor if it develops a fault, and yo also offers some cover’. How


ers some cov


policies cover mechanical br ear and t


. F outside the home t idthh ears ha e not wanted the n a pr


Howeverr,, it could be argued that the Sales Of Goods (SOG) Act is a very grey area with y int


er still do not ha e a polic sov


Clearly 12.5m customers over the past three years have not wanted the hassle of trying t fathom and leverage the SOG Act, and cannot or do not want to claim against their home or electrical goods They ha inst ead


, particularly against claims on pr ly 12.5m customers


e hassle of trying to


or do not want to claim against their home insurance for electrical goods. They have invested in warranty cover instead. saresult, the UK mar et or


fathom and leverage the SOG A insurance ffo


As a result, the UK market for warranties remains very strong. The UKs longest standing electrical goods warranty providerp oviderr,, Domestic & General, has over 8m customers in the UKstomers in the UK. The company boasts 94% post claim customer satisfaction and v


in ested in warr y vercoant emains v & eneralG


e ffo war


The UK’s longest standing y pr


, has over 8m cus


The company boasts 94% post claim cust satisfaction and very high customer retention. The John Lewis department store group has built much of its enviable reputation on its warranty offering. The company recently announced that all electrical products bought from October10 now include a minimum two- year guarantee at no extra cost. This ex ends om previous


The John L wis departm


announced that all elec w inclu


f om Or


Howeverr,, while the guarantee provides full cover against mechanical breakdown through normal use, it does not cover accidental damage, misuse or wear and tear. For his level of cover,, the company sells its own-brand the company sells its own-brand John Lewis Plan warranty insurance.


comput How


r, while the guar cover against mechanical br John L w lan warra y int is P


while the guarrantee provides full down through


mal use, it does not cover accidental damage, misuse or wear an of cov


nd t nsurance .For his lev ober10 no , tablets


y high customer r etention. ment st


e g oup


has built much of its enviable r its war


s cat


ffe ing The company r trical pr


ear guarant ee at no extra cos This extends the concept from previous categories such as computers, tablets, TVs and major domestic appliances.appliances


de a minimum t t.


ies such as s and major domestic


our home insurance gued that the Sales


fGoods (SOG) A tisavery g ey area with many interpretations, and ffew home insurance policies cover mechanical breakdown or wear and tear. Fewer still do not have a policy excess, particularly against claims on products outside the home.


, and few home insurance down or


t of gr atwa f great wa ntrarr y provider Squarvider Squaretrra arranty ade


comment on the programme’s content, but all noted that not paying out on this particular claim was an error by Currys. Clearly the customer had a legitimate claim and Currys quickly paid outkys quic ly paid out when approached by Watchdog.chdog


No warrranty companies w e willing t comment on the pr ed that not pa


was an err or by C a legitima


Unfortunately, in any business, mistakes will be made - and in a sector that sees 12.5m omers over three y y large.


when approached by fo tunat


is v , in any busines , mistaks


will be made - and in a sec or that sees 12.5m customers over three years, the scope for error is very lar


fo There is a g eat deal of r how warranties are sold, and warrant


There is a great deal of regulation around how warranties are sold, and warranty


or err d


providers and retailers spend many millions of pounds each year ensuring that sales staff ar fully con ersant with these regulations and


oviders and retailers spend many millions of pounds each year ensuring that sales staff are fully conversant with these regulations and


ate claim and C pro


s content, but all ys. Clearly the customer h


ticular claim had


No warranty companies were willing to or


ein t


what they can and cannot say as part of their sales pit


what they can and cannot sa sales pitch. Selling r


.Itist


extended warranties are governed by the Domestic Electrical Goods Act 2005 but the requirements to comply with this legislation er


equ ements to comply with this legislation are relatively simple. It is the retailer’s esponsibilit


Selling repair protection plans or ended warranties areg omestic Elect ical Gr ir


tion plans or e g


gov epair pr s fo


oods A t 2005 but the the r


responsibility that repair protection must be sold ethically and follow simple stipulations. These include the supply and prominent placement of easy-to-und on the warranty pr fo


tion must be


These include the supply and prominent placement of easy-t -understand leaflets on the warranty products on off , detailsffe , details for written quotes and a consumer right to cancel within 45 days


ts on offer


or wr en quotes and a c cancel within 45 days.


y shopper sur


while many of the sales pitches we hear from store staff on extended warranties gave us the whole picture, we also heard inaccurate claims, confusing advice and exaggeration. Some of the information about what warranties actually o


The k y area of concern is sellingy Which? conducted a mystery shopper survey of five retailers and its findings revealed that: ‘while many of the sales pitches we heard e staff on ex end


The key area of concern is selling ethically. Which? conduc ed a myst


of five retailers and its findings r om st


e us the whole pic ded war , we also hear e claims, confusing advice and


exaggeration. Some of the inffo mation about what warranties actually offer and how theyoffer and how ythe compare to other cover you may have (such as the manufacturer’s guarantee) was just plain wrong.’


as the manufac plain wr Ak


e to other cover you may ha e (such s guarantee) was just


programme was a Currys staff member who advised a customer that, upon a claim, there ould be: no exceptions, so ther int and no questions ask


A key example in the Watchdog ramme was a C


s chdog


advised a customer that, upon a claim, ther would be: “no exceptions, so there’s no small print and no questions asked”.


ys staff member who s no small


g ethically ealed that:


ollow simple stipulations derstand leaflets consumer right t


ned by the t of their


October 2013 October2013


www


w..innov


ova ivvativeelveelectricalre ic


calretailing..co.uk | 27 co..u 27


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