Discount firm discounted

Press, 18 October 1976, Page 1

Discount firm discounted

Bargain - hunters should be warned against participation in a scheme called the Consumer Discount Association, said the director of the Consumers’ Institute (Mr R. J. Smithies) yesterday.

“There is no connection between the Consumer Discount Association and the Consumers’ Institute,’’ said Mr Smithies, “but this is not made clear in their advertising. “In spite of the use of the word ‘association’ in its title, this is a business firm. People who send in money are not members, but purchasers of a service.” Mr Smith! “ is also worried about the business practices of the Consumer Discount Association. “We have waited some time to see how much use the service will be, but we are not satisfied that consumers are getting good value for their money,” he said. The firm advertises that, for a $5 fee, members will get discount in participating stores. “What they are not aware of,” said Mr Smithies, “is how many stores are participating in the scheme — a list of the stores is not sent until after they have paid their money.” He said that many stores which were enlisted in the scheme had later withdrawn from it. In Wellington last month, members were told that 12 shops were participating, with 75 more expected to join in two to three weeks.

In fact, only eight shops in Wellington were now in

the scheme, Mr Smithies said. “Consumers are not told that shops can withdraw if their sales are not increased by 100 per cent,” he said. Mr Smithies said that many unions and societies offered legitimate discount schemes, at a minimal cost to members. “We cannot see the need for a scheme like the Consumer Discount Association, and would not recommend it to New Zealand consumers,” he said.