Australian Newsagency Blog

A blog on issues affecting Australia's newsagents, media and small business generally.

Advice on handling faulty product returns

Mark Fletcher
October 6th, 2017 · 8 Comments

A retail newsagent I know recently refused to give a customer a refund for what was clearly a faulty product. The item was one day old and found to be faulty immediately on removal from the retail packaging. The item was damaged and not working properly as a result. There was no obvious respect of repair.

The retailer said it was not their responsibility.

Australian consumer law is clear on this.

Replacements and refunds
You can ask for a replacement or refund if the problem with the product is major.

Replaced products must be of an identical type to the product originally supplied. Refunds should be the same amount you have already paid, provided in the same form as your original payment.

The business may take into account how much time has passed since you bought the product considering the following factors:

  • type of product
  • how a consumer is likely to use the product
  • the length of time for which it is reasonable for the product to be used
  • the amount of use it could reasonably be expected to tolerate before the failure becomes noticeable.

For a major problem with services you can cancel the contract and obtain a refund or seek compensation for the drop in value of your services provided compared to the price paid.

The retailer is responsible. Their refusal to refund for the faulty goods broke the law. Worse still, it got them a bad name.

I was approached because the customer was searching online how to complain about a newsagent, and they found this place. They have gone back to the newsagent. If the answer remains no there will be consumer affairs and ACCC complaints. Worse still, there will be a post on a local community Facebook page. That is where real damage can be done.

The customer is energised to act not so much because of the refusal of a refund but because of how they were treated. If their story is true, the handling of the request was rude as well as outside the law.

Make sure you and everyone working in your business understand your legal obligations.

10 likes

Category: Ethics · Newsagency management

8 responses so far ↓

  • 1 eric // Oct 6, 2017 at 11:45 PM

    we stop selling alarm clocks , just too much problems.

    0 likes

  • 2 Tony Q // Oct 7, 2017 at 5:47 AM

    Eric do you mean mobile phones? Or do you literally mean alarm clocks?

    0 likes

  • 3 Steve // Oct 7, 2017 at 10:12 AM

    Faulty product returns were the reason I quite selling mobile phones year ago. To many problems for a less than 20% margin, but because you sold it your legally responsible to sort the problems out.

    0 likes

  • 4 Mark Fletcher // Oct 7, 2017 at 3:18 PM

    Steve I think that is a better decision than retailers who refuse to follow the law because they say they don’t make enough money.

    0 likes

  • 5 eric // Oct 7, 2017 at 8:36 PM

    Tony Q . we sell alot of alarm clocks for hospital patients but also alot of defects after few days used.

    0 likes

  • 6 Cameron // Oct 8, 2017 at 9:27 AM

    Ink cartrridges can throw up some interesting situations. Customers may believe the cartridge is faulty and request refund when the problem is actually with their printer. Some HP printers will throw up error messages “blaming” the new cartridge. If the printer is unplugged and turned back on the error goes away and the cartridge works fine. It’s always the things with the pissiest margins that waste the most time.

    2 likes

  • 7 Billy B // Oct 8, 2017 at 7:55 PM

    Yes Cameron you are right. Always send back for assessment prior to refund. i reckon.
    I cannot agree on the GP though.
    I have Lotto, ISI, Newspapers, Magazines, phone topups, all with crappier GP.
    But it is always the low profit lines that cause the most grief.

    0 likes

  • 8 Mark Fletcher // Oct 8, 2017 at 8:27 PM

    I agree Billy. This is another reason I am not a fan of bill payment. Low margin. High grief.

    0 likes

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