News that BrightHouse is having to compensate shoppers to the tune of £14.8m serves as a potent reminder that, in business, transparency is sacrosanct.
As the rent-to-own retailer learnt the hard way, there’s no way to escape the beady eyes of the UK’s conduct authorities.
Following a two-year investigation by the FCA, BrightHouse has agreed to reimburse customers who were either not given a refund when an agreement was cancelled within 14 days, or were not put through a rigorous enough affordability assessment.
But BrightHouse is not alone. A number of retailers’ past business practices have failed to meet regulatory guidelines.
Fashion group N Brown, for instance, has warned it will incur up to £40m in exceptional costs this year after unearthing “flaws” in general insurance products it previously sold.
And in light of reports that mobile phone providers Vodafone, EE and Three have been found to be charging customers extra for their handsets after they have been paid off, there may be additional regulations in the pipeline, which could impact those in the mobile phone market.
Retailers take warning. As the industry comes under stringent scrutiny, ensure your contracts stack up, or face the consequences.
Also today, we revealed that New Look plans to axe almost 400 jobs, and Carpetright shrugged off the big ticket blues with a 1.8% sales rise.
Quote of the day
“While trading conditions in the UK remained volatile over the first half, the 2.1% increase in like-for-like sales in our core flooring category is pleasing given the increased level of competition.
“While we expect the group first-half profit to be below that of the prior year, we are pleased with the improvement in sales in the rest of Europe and beds in the UK over the past few weeks.”
Carpetright chief executive Wilf Walsh commenting on today’s first-half update
Today in numbers
The amount shoppers will spend on Halloween related products this year, according to forecasts from GlobalData.
The number of Carpetright stores testing a vamped-up Sleepright shop-in-shop concept
Look out tomorrow for our ranking of retailers by staff efficiency.
Emily Hardy, senior reporter