Deal or no deal? How to know if the retail price is right
As the government prepares to crack down on ‘phoney bargains’ we ask experts about what exactly constitutes a genuine price reduction When is a sale not a sale? Online and on the high street, some shops just always seem to be selling at a discount. Whether it’s the closing down sale that goes on for years, or the crossed-out original price that you can’t remember ever paying, some retailers try…
The government is planning to tackle what it calls "phoney bargains" by cracking down on misleading price reductions. Retailers often use tactics like "closing down sales" that last for years, or displaying crossed-out original prices that customers may not have paid. Prime Minister Andy Burnham wants to put an end to these deceptive discounts, insisting "if something is advertised as half price, it should actually be half price."
The government will launch a consultation this autumn to consider banning fake claims of previous higher prices, invented discounts, and misleading recommended retail prices (RRPs). If the plan goes ahead, it would add to the 32 practices already banned under the Digital Markets, Competition and Consumers Act 2024.
Retailers already face penalties for unfair commercial practices, including misleading actions and omissions. Regulatory bodies like the Competition and Markets Authority (CMA) and Trading Standards can impose fines up to 10% of a company's global turnover and force refunds, but bringing enforcement action can be a lengthy and costly process.
The government hopes to simplify the enforcement process by adding egregious and false discount claims to the banned practices list. This would make it easier for regulators to protect consumers and deter businesses from engaging in deceptive pricing. However, the wording of the proposed legislation will need careful consideration to avoid loopholes.
Retailers must describe discounts in a "genuine" manner under consumer law guidance. The quoted saving must be accurate, and the product should have been sold at the original price at the same store where it is being discounted. Retailers are advised against making misleading or unfair claims when comparing the new price to a reference price.
Written by urgent.news from Guardian Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
