Poor value extended warranties onto customers, says CHOICE

CHOICE reveals 7 in 10 stores surveyed misled consumers on their rights

A new investigation from CHOICE ahead of this year’s Black Friday sales has found Harvey Norman, JB Hi-Fi and The Good Guys stores are misleading customers about their rights to a refund, replacement or repair. 

CHOICE conducted a mystery shop of 80 Harvey Norman, JB Hi-Fi and The Good Guys stores across the country and found:

  • 71% of stores provided misleading information on a consumer’s rights if their product  broke beyond the warranty period. 
  • 91% tried to sell poor value extended warranties that often don’t provide much more cover than you already have under the Australian Consumer Law.
  • Stores argued “If it’s over two years, you have to pay for the repairs yourself”, “After the manufacturer’s warranty there’s nothing we can do, it’s out of our hands” and “If something happened after one year unfortunately it’s at your own cost.”

Read the full story here: www.choice.com.au/warrantymysteryshop

“We were shocked by the results of our mystery shop of Harvey Norman, JB Hi-Fi and The Good Guys. Consumer guarantees mean retailers must help customers if a product breaks within a reasonable period of time – even if the manufacturer’s warranty has expired,” says CHOICE Editorial Director, Marg Rafferty. 

“When we asked about consumer rights outside the manufacturer’s warranty period, stores tried to sell us extended warranties, which are not much more than a sneaky sales tactic designed to squeeze more money from concerned customers.”

“Existing consumer rights provide all the protection you need against faulty products, so it’s incredibly disappointing to see these big retailers pushing poor value extended warranties onto consumers during a cost of living crisis.”

While it is illegal for retailers to breach consumer guarantees, currently there are no fines for breaking this law.

“Without fines for doing the wrong thing, too many businesses are getting away with telling consumers they’ll be denied their right to a repair, replacement or refund when something goes wrong with a product or service,” says Rafferty. 

Thinking about making a big purchase this Black Friday? Here are CHOICE’s top tips: 

  • Consumer guarantees mean your product should last for a reasonable period and if it doesn’t, you’ll be entitled to either a replacement, repair or refund.  
  • The retailer is obliged to help you if a product you purchased from them becomes faulty within a reasonable period of time – they can’t just fob you off to the manufacturer. 
  • Consider if you’re actually getting any bang for your buck with extended warranties. Most extended warranties are poor value, and you’re better off using your existing consumer rights.