Chemist Warehouse Faces Accusations Of Misleading Discount Advertising
Wednesday 19 November 2014 @ 12.25 p.m. | Legal Research | Trade & Commerce
Two major pharmacy bodies say Chemist Warehouse is misleading consumers in the way it advertises its discounts on some of its products in store, as well as on dockets given to customers.
The Investigation
The Pharmacy Guild and National Pharmacies have each written to the Australian Competition and Consumer Commission (ACCC) and asked it to investigate, with the Guild describing it as a "matter of urgency".
But Chemist Warehouse has denied any wrongdoing. In his letter to the ACCC, the president of the Victoria branch of the Pharmacy Guild, Anthony Tassone, pointed to two examples he believed misled consumers.
He said in both examples, Chemist Warehouse published a "normal price" and the amount a customer had saved on their receipt:
"The practices that are causing concern are representations on sales receipts or dockets whereby Chemist Warehouse are claiming there is a 'normal price' and a saving being enjoyed by the customer from shopping with Chemist Warehouse that day.
What this creates is an expectation that a 'normal price' could be what other pharmacies charge or [that the saving related to] a price that Chemist Warehouse were previously selling that item at, and it doesn't appear to be the case.
When the sales assistant was asked at the register what the 'you save' dollar amount meant on the receipt, she actually informed us that that would be the price you would pay at another pharmacy if you hadn't shopped with Chemist Warehouse.
It wasn't linked back to a previous price that Chemist Warehouse were selling the product for, it was linked to what other pharmacies charge."
Mr Tassone said there is not a set or benchmark price that pharmacies must sell medicines at, meaning publishing a "normal price" could create confusion and "a perception that customers may get charged one price from Chemist Warehouse versus other pharmacies".
He said:
"There could be recommended retail prices (RRP) in some pharmacies, but generally speaking from my experience, scheduled medicines that are over the counter don't generally have an RRP to benchmark against."
National Pharmacies managing director Tony Wojciechowski confirmed to the ABC that his organisation had written to the consumer watchdog to raise concerns about the prices advertised by a pharmacy retailer:
"The ACCC has a published set of guidelines for pricing … We have noticed a certain retailer has not abided by two of the guidelines on the ACCC website. We have analysed it and it's up to someone else to decide if there is a breach … We read the guidelines and adhere to them."
Response from Chemist Warehouse
Damien Gance from Chemist Warehouse declined a request for an interview, but said that everything was above board. In an email, he said "Normal price is the price normally charged at other pharmacy retailers."
Choice Also Raises Concerns About Pricing
Consumer group Choice has also separately conducted an investigation into the issue and has alleged Chemist Warehouse, among other retailers, may be in breach of laws on misleading advertising.
Choice also looked at "lowest" or "best price" guarantees offered by department stores, hardware stores and electrical retailers including Chemist Warehouse.
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