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Furniture Scams

  • Phony factory outlets:
  • Don't get taken in by phony outlets. There is no government authority that inspects stores that claim to be outlets to be sure that they actually are. There are hundreds of retailers all over the US that claim to be factory outlets but in fact offer little or no savings at all. Any store can put the word "outlet" on their sign without having to substantiate to anyone that they are actually factory owned and offer the big discounts they claim. There are no "outlet police" except for me. I am the only person who travels around and inspects furniture factory outlets to be sure they're legitimate.

    One tip off to a phony outlet: advertising in magazines. The "outlets" advertised in the backs of national decorating magazines are almost never real factory owned factory outlets. Furniture manufacturers do not advertise their outlets in magazines, or anywhere else outside of North Carolina, to avoid offending the local furniture retailers all over the US who carry their products.

    Advice to consumers: Always make sure that any "factory outlet" you buy from is actually factory owned. The common belief that "if it's in North Carolina, and they say they're a factory outlet, then it must be true" is a sad mistake that has cost a lot of consumers a lot of money. It is essential to do your research before you shop.

  • Phony discounts at furniture retailers
  • Beware of phony discounts offered by local furniture retailers. Some retailers offer exaggerated discounts in an effort to compete with North Carolina discounting. They may offer 30%, 40%, or even 50% off "retail". Often, these prices are not discounts off the real retail as set by the manufacturer, but are discounts off of a phony inflated "retail" price invented by the retail furniture store.

    Example: A local retailer may take a sofa that is supposed to retail for $2,000.00, mark it up to a retail of $3,000.00, and then put it "on sale" for $2,000.00, and call it a "1/3 off sale". In reality, the customer is paying full retail for that sofa.

    Misleading the public into believing that they are receiving bigger discounts than they actually are is illegal. Unfortunately, it's also quite common.

    One of the worst examples of this practice comes from Levitz Furniture. In 1996, Levitz was sued by the attorneys general of seven states and fined over one million dollars for advertising phony discounts. It was the second time they were sued for the same offense. According to the lawsuit filed by the State of California against Levitz, Levitz duped customers by comparing "sale" prices to "regular" prices that never existed. In the out-of-court settlement, Levitz agreed not to advertise "regular prices" unless the item is available at that price at least 60% of the time and is sold at that price at least 20% of the time.

    California Deputy Attorney General Albert Sheldon had this to say about the suit:

    "We are hoping these standards [from the out of court settlement] will lead people to not engage in as much phony advertising. It is a problem we see a lot and we are concerned about."
    It's a problem I've seen a lot, too. I've personally observed these phony discounts in retail furniture stores all over the US.

    Advice to consumers: Ignore any claims of percentages off from any furniture retailer. These percentages are so frequently inflated that they are totally unreliable.

    If you see what appears to be a great sale at a local retailer, by all means, check it out. Make sure you get their actual price in writing, though--the dollar amount, not the percentage off. Then, be sure to call several discounters and factory outlets to compare their prices on the same product. As long as you compare prices among a variety of sources, not percentages off, no one can trick you.

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