Pricing your products or services
When deciding on your pricing, you must take care not to mislead or deceive consumers. Any representations you make about price must be clear, accurate and unambiguous.
Tips for planning price promotions
- Ensure discounts are taken off the usual selling price.
- Don't use fine print to hide important information like extra charges.
- A ‘sale’ is a brief and limited opportunity to buy at a reduced price.
- 'Clearance’ sales are only for clearing goods.
- Do not exaggerate savings to be made or the range of goods available at a discounted price.
- Be careful with claims like “lowest” and “cheapest” prices, unless you've done your research and know you have the lowest price.
- you never charged the "usual" price
- you deliberately inflate the "usual" price to attract customers with a discounted price
- your claimed usual price is one of many prices at which you commonly sell the good or service
- your claimed usual price is out of date or was very rarely the real selling price.
Price comparisons over time
Recommended retail price
An appliance retailer advertised a number of sales over a period of four months. Each item advertised showed an RRP alongside the retailer's "sale" price which was significantly cheaper, and showed the percentage saving. The recommended retail prices were not the retailer's normal selling price; in fact the sale price was the normal selling price. The company was convicted and fined.
Comparisons with competitors
A leather furniture retailer incorrectly claimed its leather lounge suites on sale for $3,000 were sold by other retailers for $6,000. The Commission's investigation found that the more expensive leather lounge suites sold by other retailers were better quality. The company was convicted and fined.