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It's not just bad customer service... the dealer does have his reasons!

Discussion in 'Televisions' started by radiostar, May 8, 2002.

  1. radiostar

    radiostar
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    I know this is probably going to be an unpopular entry on this thread, but I think some explanation is required of how the mail order industry works, particularly in the case of AV, and why you'll often get problems when you buy goods you haven't seen before via mail order.

    Most AV equipment isn't stocked by your dealer. It's shipped from the distributor/manufacturer straight to you. The dealer acts as an intermediary.

    This is the most cost effective business model, because the dealer doesn't hold stock, ie. no depreciation (which is huge in AV), no insurance and no warehousing. This enables the dealer to cut their margins, so you see a cost saving.

    The downside is the implication of a customer buying something they haven't seen working is not good if they're then going to be 'particular' when they receive the goods. If the dealer offered a 'return it if you don't like it' policy, they would then have to re-stock the goods themselves.

    If for instance you're talking about a 50" plasma screen that is about to be replaced by a superior model, this could end up costing the dealer a lot. Your screen <i>is</i> second hand goods, even if you've only had it for a day, because it has been opened, all the plastic bags ripped open, shipping labels are all over the box etc. It's very evident when a screen has been sold before, and how would you feel about paying full whack for a screen that you can see has been rejected by someone else?

    The chances are that <i>if</i> they then manage to sell the screen on as second hand goods, they'll lose at least 10% of its value and have to foot it themselves. And they're taking a risk they'll sell it at all. Plus, if you paid by credit card they can refund your money, but they'll still be charged 2% of the original purchase price by the credit card company.

    In the 50" plasma example, the total cost to the dealer would be about £720 on a £6000 screen. All because the customer just didn't like what they bought having not checked it out beforehand. Someone has to foot this cost, so you can either pay more for your product or do your research before buying.

    This isn't generally a problem, because most people are fairly cautious, go and see a product demonstrated in the high street, then go home and order it cheaper over mail order. And, unless you're buying grey imports, you'll get a virtually identical product sent to you as you saw in the high street.

    Of course, all of this is irrelevant if the goods are plain faulty, in which case they should be replaced. But my advice to you all is do your research before buying, but if you choose not to then don't blame the dealer if he's reluctant to take the product back. He's got good reasons.

    radiostar.
     
  2. simon1

    simon1
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    Fair comment I suppose, but you have taken it to the extreme in quoting a £7000 odd Plasma Screen. Most tv's are bought between £1000 - £2000.

    I disagree with your bit about the retailer still paying the 2%, or whatever the charge may be, if the product is refunded. Surely not, that's why retailers insist on using the same method to refund as was used in the original payment (so that this charge is also reversed).

    I'm happy to be corrected, should anyone know differently.
     
  3. radiostar

    radiostar
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    I know for sure than Barclays do this. I'm 99% the others will all charge it too. They still have to do all the admin and processing, regardless of whether the money ends up being refunded to the card.

    I don't know why some retailers insist on it being refunded to the original card. Perhaps to minimise the risk of taking in stolen goods.
     
  4. Squirrel God

    Squirrel God
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    Yes, can see the point - but only for small retailers. That's why I'd rather not deal with them - they care too much about each and every sale because it's money out of their own pockets when you try to return something.

    Big retailers should absorb the cost of this. The best ones do. It makes for better customer service and increased sales as a result because you shop with more confidence. It's been proven both psychologically and commercially. Certainly you'd recommend a shop to your mates if they didn't give you any aggro returning stuff wouldn't you? And you'd happily use them again yourself, knowing you were in for a smooth ride.

    Marks & Spencers do this with clothes, Argos have done this with their stuff too... Others are catching on....

    That's why you are starting to see the launch of auction sites for returned stock (e.g. http://www.unrepeatable.co.uk/ and http://www.clearance-comet.co.uk/). It's a way for a happy compromise to be reached - but only bigger firms can really get away with this because only they can generate the critical mass required for auctions.

    All makes for happy people IMO :D (although I'd never buy second hand muck ;) )
     
  5. MarkTaylor

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    I have a Natwest Merchant Services account and on the rare occasions when I do a refund I also get the initial percentage charge refunded as well.

    As to the rest of the comments the Consumer Protection (Distance Selling) Regulations 2000 ( http://www.hmso.gov.uk/si/si2000/20002334.htm ) really don't give the retailer a choice about accepting returns or not, if they want to be in the business of selling by phone, internet or other distance transactions then they are required by law to accept the return of merchadise simply on the basis that once the customer has had the chance to look closely at it he has changed his mind.

    Simple as that, choose to get a wider market for your products by selling in this way and no matter how inconvenient it may be you must accept the returns. There really is no choice for the retailer in this matter.

    Mark
     
  6. Zacabeb

    Zacabeb
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    And of course, as shown by the Philips CRT debate, you will not ever know what you get even if you check it out thoroughly beforehand.

    I made more than reasonable research before buying my Philips 32PW9616, checking out a total of 7 sets of different age, reading several magazine reviews, internet reviews, consumer opinions. I even went as far as getting hold of the service schematics and taking note of what components were inside, downloading datasheets and tracking down the manufacturers of known non-Philips components by researching the letter codes in the component typenumbers.

    I thought I knew exactly what to expect and what could reasonably differ inside from set to set. I was wrong. Anything and everything can differ.

    It is almost futile to check things out beforehand, there is a big chance what you'll get will vary significantly from what you saw. Actually, checking things out beforehand may cause you more harm than good. What you don't know can't hurt you. Ignorance is bliss. Blessed is the village idiot.

    I should never have learnt how things work. It's caused me nothing but trouble. :(
     
  7. gringottsdirect

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    Things will have to change, the Distance Selling legislation really does mean that dealers have to find a profitable way to deal with returns.
    Mail Order isn't working, even the biggest companies have a problem with AV related sales, and that includes makers, no company can afford the present business model.
    Small shops are affected too, if mail order customers are using them to test drive before ordering from the internet, they simply won't be around. Should anyone care?
    Interesting to see how the next couple of years shake out.
     
  8. Squirrel God

    Squirrel God
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    The Distance Selling legislation is a fantastic thing IMO. If only the retailers actually observed it ....

    Zacabeb --

    I have to agree with you about knowledge. I often feel like Adam and Eve when they bit the apple :( There's nothing more annoying than having someone round who is "ignorant" (for want of a better term) and trying to show them the geometry imperfections in your television, or the picture tilt, or the motion blurring, or other faults.... Drives me mad when they say "I just can't see what you mean - looks fine to me" :mad: Not hard to guess who's happier with their purchases - clearly them! Shame we don't have an envy smiley on here :rolleyes:
     
  9. MarkTaylor

    MarkTaylor
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    The funny part is, if the retailers don't follow the Distance Selling regulations they extend the period that you have to return your purchase.

    The 7 working day limit only starts from the time that they fully inform the purchaser of all the details required by the regulations so by not providing them they extend the window of exposure.

    Trading Standards people will be very happy to assist you in getting your rights under the regulations.

    I'm afraid that the business models will have to change. For consumers it will probably mean that prices will rise a little, but you will be able to buy with the confidence that if the product is not as good as you'd hoped it can be returned easily.

    I do have sympathy for businesses selling large branded items with indirect shipment from distributor to consumer since for the most part it wasn't this sort of item that really prompted these regulations to be brought in.

    But for good or for ill the regulations are in place and the retailers will have to live with them or expect a lot of attention from Trading Standards and Credit Card companies.

    Any business model that relies on the customer going to visit other businesses expensively maintained store displays to reach the purchasing decision then order from someone with no store front to pay for and maintain is flawed.

    The distance Selling regulations just level the playing field a little, if you want to do business without a shop, or do business with people living too far away to visit your shop then you have to accept the cost implications of returned merchandise.

    Mark
     

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