What does this leaflet cover?
There are a number of traders who seek to book premises and hold sales that give rise to complaints from consumers and venue owners.
The purpose of this guide is to warn of the trading practices of these problem traders, and to offer advice on the acceptance of bookings.
Typically, a room will be booked for a sale of household goods or similar. The sale will then be advertised in the local papers and/or by leaflets delivered to houses in the locality. These will typically feature a range of bargain-priced goods, offered for disposal at a 'sale of bankrupt stock' or 'massive liquidation sale', or some similarly described event.
The apparent bargains on offer often attract quite a large crowd but, in practice, the bargains rarely, if ever, materialise at the sale.
For example, a 'massive disposal sale' featuring a range of brand name goods such as televisions or DVD players may actually turn out to be a sale of low value goods such as tool sets, glasses, blank DVDs and electrical goods, many of which may be reconditioned, seconds, or catalogue returns.
The goods will not be on open sale but will instead be offered for sale during the course of a very slick sales promotion, delivered from a podium to a crowd of expectant consumers, who are very often completely taken in by sales tactics that rely on crowd psychology to generate excitement. These tactics may include asking consumers to put up their hands if they want to buy certain goods or a bag of goods, or selecting certain consumers to the exclusion of the rest of the audience.
In a typical sale, the salesperson will begin by offering low-value goods at giveaway prices. They will then proceed to develop the sales atmosphere by apparently offering for sale more valuable items. These items may actually be purchased by people 'planted' in the audience by the organisers. A limited selection of brand-name electrical goods may be displayed on the sales rostrum, but they may never actually be sold. Their presence, however, ensures that audience interest is maintained. In some cases there may be a 'plant' in the audience who has been put there by the sales promoter. This person then appears to be getting some genuine bargains which only adds to the excitement.
The aim is to reach a point where consumers are willing to hand over money to purchase the contents of sealed bin bags in the expectation that they contain quality goods. The consumers are told not to open the bags until they get outside, or at home, and it then turns out that they contain cheap, poor quality items. By this time, it is usually too late. When complaints are made, the organiser will tend to be very unhelpful in dealing with them.
The sales practices described are likely to be 'banned practices' under the 'bait advertising' provisions (or 'bait and switch') of the Consumer Protection from Unfair Trading Regulations 2008. The promoter could face either prosecution or action under the Enterprise Act 2002 to prevent the practices. There could also be action against deceptive descriptions, pricing methods or fraud.
Typical complaints received allege:
Venues have complained that the nature of the sale has been misrepresented to them when they accepted the booking and in some cases that they have not received payment for the booking. At some sales, members of the venue staff have had to deal with very angry consumers who held them responsible for resolving their grievances with the sales promoter.
What can I do?
The obvious answer is to say no to any enquiries from sales organisers. However, if you are not sure whether the enquiry is from a genuine trader, ask some searching questions about the type of sale proposed when you receive the initial booking enquiry.
A booking form, including a code of conduct, has been prepared for venues to secure written agreement that the hirer will abide by certain terms and conditions. The form has been designed to prevent the conduct of a one-day sale of the type described above. You may also wish to refer to the terms and conditions provided on the form when the initial booking enquiry is received, to assist you in establishing the nature of the proposed sale. If you receive the right assurances from the enquirer, and decide to proceed with the booking, the hirer should be asked to sign the form.
This leaflet is not an authoritative interpretation of the law and is intended only for guidance. Please contact us for further information.
Last reviewed/updated: September 2011
© 2013 itsa Ltd on behalf of the Trading Standards Institute.