EmergingGrowth.com Report on Jos. A. Bank Clothiers and their "Too Many Sales" Practices.
Miami, FL - December 6, 2012 (www.investorideas.com newswire) EmergingGrowth.com, a leading digital financial media company, Reports on Jos. A Bank (NASDAQ: JOSB), Macy’s (NYSE: M), J.C. Penny Company (NYSE: JCP) Kohl’s (NYSE: KSS), and Michaels Stores (NYSE: MLK) and Deceptive sale practices as the lawyers call it.
Feature your company on EmergingGrowth.com. Click here to find out how .
When a store's merchandise seems to be always on sale, is it ever really on sale? Is the retailer just posting fake prices that no one ever pays? Do the prices exist only to make discounts seem tempting? Two customers of Jos. A. Bank Clothiers(NASDAQ: JOSB) contend that the company utilizes these disreputable tactics in order to sell product. Theyhave gone as far as filing a class-action lawsuit against the Maryland based men's apparel chain, accusing the retailer of using misleading advertising by claiming products are on sale when they are in reality being offered at standard price. The lawsuit, which was filed April 5 in U.S. District Court in Newark New Jersey, asserts Jos. A. Bank misrepresents to customers that goods are being promoted at a discounted sale price for a limited time, when the company “rarely, if ever,” in reality sells goods at a higher, regular price. In the litigious world we live in it seems you can sue a store for having too many sales.
The fact of the matter is that many retailers such as Macy's (NYSE: M), Michaels Stores Inc. (NYSE: MLK) and J.C. Penny Company Inc. (NYSE: JCP) employ or have employed a 'never ending sale' strategy in order to boost sales. But is it legal? It seems that depends upon where you live. At least 12 states, other than New Jersey, have laws on the books showing how long a retailer is required to offer an item at a regular price before it can claim it is selling at a cut rate. South Dakota calls for the regular price be in existence for at least seven successive days out of 60 before the sale. In Alaska, establishing an item's normal price entails offering it at that price for at least six months out of the preceding 12 months. The rest of the states rely on FTC's Guides Against Deceptive Pricing in order to enforce marketing and advertising standards.
Just last year Michaels was slapped with a $1.8 million dollar settlement in New York after the State Attorney General found that the craft retailer had been utilizing a continual sales strategy. In the settlement, Michaels agreed that it would not make fabricated former price comparisons. Illustrations of fictitious former prices given in the settlement were (1) prices that were not used in the regular course of business; (2) prices that were not used in the recent past but at some remote period in the past without making disclosure of that fact; (3) prices that were not openly offered to the public; (4) prices that were not sustained for a equitable length of time, but were advertised and then instantaneously lowered; (5) prices that were rarely paid by consumers because reductions were offered by sales people; and (6) prices reduced as a result of negotiation. Until recently, retail giant JCPenney used some or all of the strategies described above. The company hasadmitted that less than 1% of its returns had been coming from full-priced items and is in the process of reworking the way it sets up sales. Retail clothier Kohl's (NYSE: KSS) has also been accused of advertising reductions that are in fact not deals to consumers.
o matter the retail segment, virtually every major company has used the 'never ending sale' technique. From mattresses to clothing and appliances, consumers are complaining in record numbers about sales that are suspect. The bottom line is that never ending sales now lead to never ending litigation woes for many companies. Consumers are also complaining these never ending sales cycles feed never ending shopping addictions. Where do you draw the line on litigation that from the outside appears disingenuous at best and frivolous at worst? Of course there are legitimate complaints. Some companies have practiced deceptive sales advertising and should be made to cease such practices. On the other hand, as with many grievances, it seems to be about a hoped for large payday for the lawyers and litigants. It will be interesting to see what precedent is set by the Jos A Bank lawsuit.
By offering 100% original and unmatched content by the best financial reporters, writers and bloggers in the business, EmergingGrowth.com is emerging a leading digital financial media portal. Its services provide users, subscribers and advertisers with a variety of content and tools through a range of online, social media, mobile and other mobile outlets.
Since its inception, EmergingGrowth.com has distinguished itself from other financial media companies with its sly approach to reading between the lines in order to locate that needle in the haystack. Subscribe today to see what EmergingGrowth.com has to offer.
NEW: Feature your company on EmergingGrowth.com. Find out how by filling out our form at http://emerginggrowth.com/recommend-a-company-to-feature-on-emerging-growth
Join our Linked in Group
Like us on Facebook
This news is published on the Investorideas.com Newswire and its syndicated partner network
Get free news alerts:
Sign up here
Published at the Investorideas.com Newswire - Big ideas for Global Investors
Disclaimer/ Disclosure:The Investorideas.com newswire is a third party publisher of news as well as creates original content as a news source. Original content created by investor ideas is protected by copyright laws other than syndication rights. Investorideas is a news source on Google news and global syndication partners. Our site does not make recommendations for purchases or sale of stocks or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investment involves risk and possible loss of investment. This site is currently compensated by featured companies, news submissions and advertising. Contact each company directly for press release questions. Disclosure is posted on each release if required but otherwise the news was not compensated for and is published for the sole interest of our readers.
BC Residents and Investor Disclaimer: Effective September 15 2008 - all BC investors should review all OTC and Pink sheet listed companies for adherence in new disclosure filings and filing appropriate documents with Sedar. Read for more info: http://www.bcsc.bc.ca/release.aspx?id=6894. Global investors must adhere to regulations of each country.