Transparent Pricing and Online Shopping

By: Lucy Debenham BA (hons) - Updated: 9 Sep 2020 | *Discuss

 

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Online shopping is a phenomenon that looks set to stay. Sales are steadily increasing each year, and business opportunities within this sector seem neverending. Consumers are turning to the Internet as it offers more choice, flexibility and competitive pricing. However the Internet has one flaw – it can be much harder to spot an unscrupulous seller.

There are literally hundreds of thousands of transactions that take place on online shopping or auction sites each day, and only a fraction of these purchases prove problematic. However, consumers still need to be on their toes when it comes to recognising less than honest sellers, if the findings by the Office of Fair Trading (OFT) are anything to go by.

Understanding Your Online Shopping Rights

It is vitally important that you understand your rights with regard to online shopping, as some online retail outlets take advantage of consumer ignorance, particularly with regards to transparent pricing. The OFT estimates that online shoppers can pay upwards of £100 million in hidden charges, as a result of breaches of law and uninformed consumers.

The Sale of Goods Act basically stipulates that when you buy goods, when they reach you they should be of satisfactory quality, as described (this includes the product description and price) and fir for purpose (for example, if it says it’s waterproof, then it really is waterproof).

The Distance Selling Regulations ensure that when buying in circumstances where you are not able to physically be present when making the purchase. Distance Selling applies to mail order catalogues, digital television, SMS and phone purchases, in addition to Internet Shopping. The basic premise is that as a consumer, you have access to ‘prior information’ - this should include information such as business name and address, full price of goods and services on offer, as well as your rights pertaining to returns, refunds and cancellation policies.

The E-Commerce Regulations have been created to help sellers and consumers complete electronic contracts (the purchasing and delivery of goods or services). The regulations stipulate that business details should be readily available to the consumer, should there be any dispute with the quality of goods or services received. The regulations also ensure that all pricing strategies and advertising used by the seller are lawful – that is, that they are clear, not misleading and include all otherwise hidden fees such as VAT and delivery/shipping costs.

Transparency in Pricing

The main problem was linked to the refund policies set out by these online shopping sites. The Distance Selling Regulations require sellers to incur the cost of a full refund, yet some retail sites were not complying with this fundamental aspect of this piece of European legislation. Under half of the online retail outlets that were surveyed were failing to clearly outline additional charges before reaching the checkout stage of a purchase. These ‘hidden charges’ often include the cost of delivery, which can significantly increase the price of a purchase.

However, despite this finding, the OFT still found that the majority of online shops were complying with the regulations and legislation designed to protect consumers. So as a consumer buying online, you should still have confidence that there are honest and law-abiding retailers out there.

However, if you have a good understanding of your consumer rights, and know what to look out for, you’ll be able to make an informed decision about whether you’re buying from a reputable company who respects your rights.

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