Why You Could Pay More Instead of Less at a Shutdown Sale

Check prices before buying at a shutdown sale: Internet Scambusters #786

When you enter a shutdown sale or an outlet mall store, don’t assume you’re getting a bargain.

In fact, you could end up paying over the odds for a “sale” item or buying a branded product that’s not what it seems.

In this week’s issue, we’ll explain how easy it is to get ripped off — and what you should do to make sure you’re not.

Let’s get started…


Why You Could Pay More Instead of Less at a Shutdown Sale


Everybody loves a bargain so when you see a shutdown sale at a local mall, you may be tempted to race on over to join the treasure hunt.

But, hold your horses! Is that store really closing? Didn’t you see the same sign at the same store this time last year?

If you did, that’s a lawbreaker. It’s illegal for a store to claim it’s shutting down when it isn’t. If you know for sure what they’re up to, you can report them to your local consumer protection department or state Attorney General’s office.

But even if it’s legit you could still be conned — by being charged more for a “sale” item than you might have paid before the shutdown announcement.

It’s possible they’ve marked down prices from inflated prices that never really existed. You may not be making the savings you were hoping for.

Furthermore, it may not be the original owner who’s running the sale. Sometimes an owner might sell the store’s entire inventory to a liquidator for disposal.

Some liquidators specialize in these type of sales — moving inventory from one closing store to another, so you’re not necessarily being offered items from the original stock.

And, once again, prices are often marked down from the supposed “suggested retail price,” which is a fictional number that’s pitched to make it look like the new price is a bargain.

“That means goods can end up costing more than they did before the going-out-of-business sales began,” the U.S. Federal Trade Commission (FTC) warned in a recent alert.

So, how can you avoid being ripped off?

The first and most important rule is simply to check the prices against those on offer elsewhere.

You can do this at home on your PC if that’s where you are when you spot an ad for the shutdown sale. But if you’re already in the store, you can probably also make some comparisons on your smartphone before you buy

This is a good first step even if the store is genuinely going out of business. But that’s not all there is to it.

If it’s a liquidator’s sale, many sellers won’t accept previously issued store gift certificates or credits. And they likely won’t accept returns. If you buy, it could be yours forever, even if it doesn’t work!

So, check that it does work and that there are no other obvious defects. And if it’s a product that should come with a warranty, make sure the warranty card comes with the packaging.

If it’s not available and you still want to buy, check to see if the product can be registered online without a warranty card. Many manufacturers will accept this providing you have the serial number.

Shop Wisely at Outlet Stores

Shutdown sales are not the only way you can be hoodwinked into overpaying for what seems to be a bargain.

This is happening more and more at specialized outlet malls, where famous brand names offer their products at discount prices.

Shoppers should understand that oftentimes the products they buy at these stores may be defective or, in some cases, cheaper versions of the well-known branded products made from inferior materials — such as plastic instead of leather.

These stores are not breaking any laws, as long as they don’t make dishonest claims. But they still might use that “suggested retail price” trick to make their products seem more of a bargain.

Sometimes too the defects in so-called “seconds” may not be easy to spot without careful checking.

It’s not unheard of, for example, for pants to have one leg that’s longer than another, for seams to be unsewn, or patterns to be badly mismatched.

All of this underlines the importance of checking anything you plan to buy from an outlet store — not just the price but the actual product itself.

For instance, what does the product label tell you about the materials used?

You can often glean a lot of useful information by talking to a sales assistant in the store. You can ask them directly how an item differs from the ones available online or in the main store — or whether it’s manufactured specially for outlets only.

Ask them to identify any defects in the product, and find out about the store’s return policy. If you live some distance from the mall, it may not be feasible to return an item, especially if you have to pay shipping costs.

The lessons we learn from these two scenarios — shutdown sales and outlet malls — is that you shouldn’t buy a “bargain” unless you know it really is a bargain! These days it’s fairly easy to check the true value of something you’re planning to purchase — so resist the temptation to buy on impulse.

The FTC has a whole section of information and tips on shopping and savings.

Alert of the Week

Staying with the FTC, the agency has recently announced an agreement with the money-wiring agency Western Union to repay up to $586 million to victims who used WU to pay scammers.

The deal covers scams between January 2004 and January 2017. Claim forms are being mailed out to some victims, but if you’re a victim and haven’t received a form, you can claim online. You have until February 12, 2018, to claim.

That’s it for today — we hope you enjoy your week!