| Date: | January 13, 2006 / year-entry #20 |
| Tags: | non-computer |
| Orig Link: | https://blogs.msdn.microsoft.com/oldnewthing/20060113-21/?p=32663 |
| Comments: | 46 |
| Summary: | Marketplace reports on the start of the winter sale season in France. By law, retailers are permitted sales only twice a year, so the onset of sale season generates quite a bit of shopping madness. There is also a proposal to allow more sale periods, but opponents argue that doing so would harm smaller businesses.... |
Marketplace reports on the start of the winter sale season in France. By law, retailers are permitted sales only twice a year, so the onset of sale season generates quite a bit of shopping madness. There is also a proposal to allow more sale periods, but opponents argue that doing so would harm smaller businesses. Coming from the land of sale fatigue (we just emerged from the after-Christmas sale season and are entering the Winter White Sale season, after which comes the President's Day season...), I find a certain appeal to the idea of limiting how often things can "go on sale". Who can forget the oriental rug stores that are perpetually going out of business? It's become such a joke that The New York Times flatly refuses to run "Going Out of Business" sales for oriental rug stores. |
Comments (46)
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I would be tickled pink if we just had a law that said Christmas sales couldn’t start until December 1st!
James
"Who can forget the oriental rug stores that are perpetually going out of business?"
We have the same phenomenon here in Denmark. I would never have guessed that this is international.
Laws that control when private business can have a sale?!?!
A prime example of government control run amok.
There’s an oriental rug store around here (DC area) that has been having a "lost our lease" sale for at least five months. Apparently losing one’s lease is a great reason to have a sale but not a great reason to actually move out.
Heh. Makes sense to me:
After the expiration of a "Going Out of Business" sale, all subsequent advertisements submitted by that advertiser will then be unacceptable. As far as The Times is concerned, that advertiser will then be considered to be out of business.
Get with the times, T.O. Government is in charge of everything, and is the most efficient way to handle all problems. It’s much simpler this way. You can’t have people just going around doing whatever they want.
I don’t know about the laws elsewhere, but in Canada there are laws governing that sort of thing. They’re regarded unfair business practices, and they prevent companies from perpetually (or near-perpetually) having items ‘on sale’, because the sale price then is effectively the regular price and the sale sticker is misleading consumers.
I’d be surprised if it is different in the US. Businesses shouldn’t be allowed to lie to people.
European countries have some of the weirdest laws. During a vacation through Europe, I was paying for dinner at a restaurant and my guests reminded me that I should not leave a tip. Giving your waiter a tip was illegal!
Travis:
You mean like laws that govern minimum wage? Laws that govern fair trade (NAFTA)? Laws that govern consumer protection?
Before blindly saying "government stay out", you have to understand what is being protected.
Interesting. This summer I was in France and was surprised at how EVERYTHING was on sale. I wasn’t sure if it was a big sale season, or if everything in France was just "on sale" constantly, like some stores here (ahem: Wilson’s Leather). I guess I just managed to arrive during the big seasonal sale.
"Travis:
You mean like laws that govern minimum wage? Laws that govern fair trade (NAFTA)? Laws that govern consumer protection?
Before blindly saying "government stay out", you have to understand what is being protected."
No, I think he means laws like, "You can only have two sales a year."
It’s almost like France is a whole different country.
When I was growing up we had a furniture store that went out of buisness at the end of every year. I seem to remeber they acutaly did lock there doors for a couple weeks then reopened the next year.
None one in my family knew the tax codes, but we all figured it was an attempt to avoid paying taxes.
Yep and maybe they should make a law that you can’t advertise something for 2.99 per gallon, it must be 3.00 so its less deceiving. Give me a break. I’d be suprised if the word "sale" isn’t banned in France, since its English
The word "sale" does seem to be banned in English–in advertising at least. It’s not a sale, it’s a "sales event" or just "event". E.g. "Dodge year-end event" "Toyota red tag event", the list goes on. For cryin out loud, just call it "Dodge year-end sale"!
"Event" has quickly become my most despised word. It’s not just limited to sales–special TV episodes are now "events". Listen to some TV advertisements and keep your ears open for the word "event". It’s overuse will sicken you.
</rant>
Patriot,
The word "event" is used precisely because they aren’t actually having a sale. There are regulations in the US governing what is considered a sale, and when it fails to meet that criteria it’s often labelled an "Event" so that people still think they’re getting a good deal, even when they’re not.
It’s like the suit store here in Canaduh. They have "One, and only one, sale per season".
Now, is that an Imperial Season, or a Metric Season?
Two scoops of raisens in every box. . .
Till 2004 (I think), the law in germany prohibited more than two sales periods per year. When this was abolished, stores protested an one last "Sommer Schluss Verkauf (SSV)" was allowed.
Yeah, strange laws in some parts of europe, but regarding things like death penalty or weapons, I wonder whether US is so much superior
The best "law" I read about for a long time was this: http://www.tagesschau.de/aktuell/meldungen/0,1185,OID5061280_TYP6_THE_NAV_REF3_BAB,00.html [in german] From January 2006, norwegian farmers have to provide mattresses for their cows. No joke but the law pays off: cows give more milk when sleeping on mattresses.
Funny… so to protect smaller businesses you harm poorer people by making it harder for them to find low-priced goods. Combine that with an oppressively high minimum wage and you have 25% of youths of color unemployed and nighly riots in the suburbs/ghettos.
But hey! At least the inefficent small business are allowed to keep going!
There are entire months where I won’t go into any store at the mall except Nordstrom’s. Nordy does 2 sales a year and does not do *any* xmas decorations until after Thanksgiving.
Travis:
One of the best justifications for a law is alleviating a prisoner’s delimma-type situation. Think campaign finance: if everybody is forced to spend no more than $500,000 dollars on a local campaign, voters would be no less informed. But if candidate A is spending $10 million, candidate B has to as well, and if they try to sign some pact that they’ll both not spend too much, one or the other will cheat. With govt campaign finance laws (done right, which is impossible), much less would be wasted on campaigning, and we’d probably wind up with the same guy elected.
Similarly, stores have sales (to a great extent) because the neighbors are having sales. Sales to truly and honestly clear out inventory are few and far between. So this can be a case where retailers are happy to have their hands tied by the government, because their competitors’ hands are also tied, so they can stick to a consistent pricing scheme and not waste money on escalation-style advertising.
Come on, guys. Are you serious? Why does it matter at all how they call it? Just "Sale" or "Out of business sale" or "XYZ Sale"? I always have been thinking (naively) that the price what is important, not the color of marker it’s written with. If you’re OK with the price and goods, then buy it, else go to next store. End of story.
I heard about strong socialist sentiments in Europe, especialy in France. However, legislating number of sales per year it utter absurdity and look for me insane. One can only imagine what happens therein other businesses. How do they intend to compete with US and other worlds?
—Alex Blekhman—
Come on, guys. Are you serious? Why does it matter at all how they call it? Just "Sale" or "Out of business sale" or "XYZ Sale"? I always have been thinking (naively) that the price what is important, not the color of marker it’s written with. If you’re OK with the price and goods, then buy it, else go to next store. End of story.
——————
Alex, that sounds good in theory, but remember that searching for these prices has a nonzero cost to consumers. If you advertise in big flashing banners or you have an attractive location, you reduce the cost of searching for that consumer. Conversely, if your store has terrific prices but is out in the middle of nowhere, not many people are going to make the effort to drive by just to see what your price is.
—Raymond Chen—
Who can forget the oriental rug stores that are perpetually going out of business? It’s become such a joke that The New York Times flatly refuses to run "Going Out of Business" sales for oriental rug stores.
——————
Definitely! It smacks of dishonest advertising, to say the least.
Well,
I don’t know about other countries, but it sort of makes sense to limit the number of sales. You see, in France, the two sales period are the only times where a business can sell things and loose money in the process. Otherwise, it is forbidden to sell things this way. The idea is to give businesses an opportunity to get rid of unsold items.
Any other time of the year and not subject to regulations, you can have what is called "promotion". It’s basically a bargain, but the price cannot be so as to make the seller loose money in the process.
"…but the price cannot be so as to make the seller loose money in the process."
These kinds of laws are really creepy. People should be free to buy and sell things for as much or little money as they want. I’m always amazed at the amount of tortured logic (or lack there of) people use to justify these laws. Crack open any economics textbook and you can easily read how these type of laws do harm instead of help. But people still cling to their flawed arguments. It’s a waste of time to argue.
Could we cancel the money system and replace it with bartering focus on value and developing negoitaitng skills, much more fun that Americanised ‘shopping’
I would love some laws regulating sales, hopefully making them less common. My wife seems to be very susceptible to them.
"…homosexuality is not a threat to the sanctity of marriage… credit cards are."
I heard this on Marketplace too. Europe is a dreamworld, but for how long? The will be facing their demographic nighmare soon, they’d be wise to awaken.
Poster,
I was not trying to argue in favor of the regulations. I was trying to explain the rationale behind it, although I don’t know the economic words in english…
I too realize that many laws yield a direct opposite result of what they are trying to address.
In this case, for instance, it is not uncommon to feel that the items on sale look like items that were designed to be on sale in the first place.
Sometimes, items on sale are available in huge quantities, and appear throughout most of the entire six weeks sales period. Makes you wonder how any business could have been wrong and have so many unsold items at the end of the season.
Come on guys, the reason why a French vendor can’t sell something for less than it paid for is to avoid unfair business practices like predatory pricing or dumping.
It’s really an economic reason, and has nothing to do with socialism as some of you seem to believe.
And yes, there are also legal ways in France to depreciate the value of stocked goods over time to be able to sell them at lower prices, but this generally requires several months.
The sales periods were designed to get rid of inventories. The rebate stickers are restricted to items that were on the shelf at least one month before the sale’s start.
At least that’s the theory, because it’s not always what you’ll find in stores during the periods, yes, there are cheaters everywhere :-)
And the big stores like C&A or H&M don’t like sales because they normally rotate most of their stocks in only 3 weeks, so they’re forced to overstock for the sale, though they make huge benefits during these periods.
Poster, you say:
"Crack open any economics textbook and you can easily read how these type of laws do harm instead of help"
Could you care to elaborate and name a single book that confirms what you say ?
In Australia we have no regulation regarding when a “Sale” can be held. So Christmas sales starts in some stores in November and goes on until January. Same goes for other holidays. EG we already have Easter eggs for sale and some of them are already ‘On sale’.
Some stores bring in inferior quality products when they hold a sale (4 times a year for some of the larger stores) sometimes they increase or keep the same price on normal products or mark them up by 10% to 30% and reduce that price.
The banners at the front of the store 2M by 7M read: “XYZ Sale all stock reduced by 40% to 80%” and underneath in letters 10th that size “limited items only”.
"Could you care to elaborate and name a single book that confirms what you say ?"
Any book that explains how supply and demand interact, which is pretty much every economics textbook. Or go to any university and ask any economics professor. But let me warn you, asking an economist if government control of price is harmful is like asking a physicist if the Earth is flat or round.
Wow, there are a whole load of clueless/troll comments here.
Since when does enforcing the use of the word ‘Sales’ mean that companies cann’t offer competitive pricing the rest of the year?
Evil companies with year-long ‘sales’ are doing nothing more than false advertising and deliberately misleading the public. Funny, but I thought that that would be a pretty damn good reason for government intervention. Then again, screwing over the public with lies is part of ‘corporate freedom’, and should be encouraged, right?
If a company wants to change the price of something – say reacting to competition, supplier pricing, in/decrease in demand – whatever – that’s fine. They just can’t mark every price change as a ‘sale’. Yes, that also applies to the case of increasing the price overnight when the shop is closed, decreasing it in the morning when the shop opens, and calling THAT a ‘sale’.
You have to remember that people, with a fraction of a percent excluded, are dumb and believe most ther stuff they’re told. This is just part of the 50% of governments do to protect the idiotic (the other 50% comprises of either attacking and taxing the idiotic, or else putting their favourite idiot in the president’s chair).
"Any book that explains how supply and demand interact, which is pretty much every economics textbook. Or go to any university and ask any economics professor. But let me warn you, asking an economist if government control of price is harmful is like asking a physicist if the Earth is flat or round."
Not picking on this comment in particular, but it’s the latest to use this myth.
There is NO price control in limiting the use of a marketing term. Prices can be set however you want, at whatever level you want, but you just can’t have a year round "sale" that consists of nothing more than natural price fluctuations or artificially raising prices for a few days before dropping them back to normal levels in a "sale".
I live where there is no restriction on this shady (and anti-consumer) business practice. I’m jealous that France actually have a good law here.
Two sales periods per year is enough. I don’t think we should multiply the number of sales period beyond this.
The Minister’s proposition to go from two to four sales periods per year aims to drive customers more often to the shops, to boost sales and the economic activity.
But I think he misses the goal because the proposition is built on making attraction by lower prices, which mean low (or no) profits for the shops. Furthermore, with 4 or 6 sales period per year, no one would buy at normal prices, and each and every customer would much prefer to wait for 4 or 6 weeks in order to get an extra -30 or -50% rebate.
I think that those shops should think about driving customers to them by innovation. Look at what Zara and Mango are doing in the apparel market: they propose new models every 4 to 6 weeks, they create animation in their shops by doing so. But this of course supposes that one apparel maker has the ability to drastically reduce the design and production cycles. Enter CAD and PLM and Collaboration solutions for the apparel and garment markers, with solutions like those from LECTRA Systems (running on Windows ;))
This debate reminds me of another one: I think the shops and retailers should not fight and attract customers on lower prices, but create attraction on innovation to bring those customers more often to visit their shops.
My 0.02 Euro Cents,
Christophe
How long do the two sales last?
I’m guessing that the Summer and Winter sales don’t last 6 months each :-)
Incorrect Assertion:
"Prices can be set however you want, at whatever level you want…"
But that contradicts what Maxime LABELLE said:
"Any other time of the year and not subject to regulations, you can have what is called "promotion". It’s basically a bargain, but the price cannot be so as to make the seller loose money in the process."
So which is it? Can stores always charge whatever they want? Or is it illegal for stores to sell below cost?
Heck, while we are at it… let’s get rid of Rebates as well.
This is a despecable practice that is the same as corporate gambling. They are gambling that you are too lazy to request and fight for the money they owe you. If they want to offer a product at a certain price… lower the price.
Oh.. I should do that with my board game. Charge $400 for it, with a $380 rebate! Holy cow that is cheap! People will flock to buy it for the rebate alone.
John:
Agree totally on rebates, they’re even worse. It’s just a way of advertising a lower price than you actually have to pay. People not getting/losing/not being able to access the rebat e form, overly complex procedures, unrealistically high rate of "must have got lost in the post" rubbish – just a way of stealing from the customer.
Lucky we have very little of that here in the UK. I wouldn’t be surprised if there was some consumer protection law behind their absence.
But… off topic.
sigh.. I meant "from a given list", not "any given list".
The list of products you can buy under this program is negociated between the distributor and suppliers, so you won’t always find the best of all.
Hear hear on getting rid of rebates. I bought an item with a rebate which needed to be postmarked for that day. I didn’t know that at the time I bought it, and when I walked out of the store peering at the reciept, I realized that at that point I had about an hour and change to fill out the rebate form, mutilate the box of the item I bought to get the UPC, buy an envelope and stamps, and then run the entire package to a post office. Now that was seriously ridiculous.
"So which is it? Can stores always charge whatever they want? Or is it illegal for stores to sell below cost?"
they can’t sell below the "value" of the product, where value varies over time. If you buy something at 100€, you can’t sell it immediately for less than that. Except during the "soldes" (sales periods, in French)
In some cases, you can however depreciate the "value" of your stock after several months of inventory, but it’s a rather controlled accounting acrobatic. I believe the clearance period is only several days for some diary products and other fresh food that quickly deteriorates (e.g. red meat)
Otherwise, you can advertise "promotions", which means you’re slashing your prices by X%, but you’re only allowed to do that by reducing your margin, i.e. you’re not supposed to go below cost. Of course, most of the time, the original price was inflated anyway :-)
There are rebates in France, but people don’t fall for them because the law forces vendors to display the *purchase* price on each product, and *not* the reduced one, so you get things like "by this at 5€ and we’ll give you 1€ back". And we have plenty of coupons, fidelity cards, etc…
There is even an event where a specific supermarket company organizes a 100% rebate program every year: i.e. buy products from any given list (of about 400), fill in some application card, and you’ll get completely paid back 5 weeks or 3 months later. My mother did this twice already. In case you’re wondering, everything is paid by the suppliers which are forced into the event by the distributor.
You’re however limited to one item per proposed product. And don’t expect to buy a Plasma HDTV with this :-)
Are rebates common in countries other than the US? I don’t think I’ve ever seen or heard of one over here (UK) that I remember.
What’s the point? Buy this and send off this coupon and eventually we’ll send you some money back? Do they just hope that some people won’t bother are or excluded by ridiculous caveats (e.g. the comment above!)
"During a vacation through Europe, I was paying for dinner at a restaurant and my guests reminded me that I should not leave a tip. Giving your waiter a tip was illegal!"
I suspect there was some confusion over the matter. While there may be the occasional weird law, I don’t believe tipping is illegal. However, it’s unnecessary, as many restaurants in Europe automatically add an 18% or larger gratuity.