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Arizona Department of Weights and Measures CORPORATE EDUCATION 99-Cent Stores 99-Cent Stores.

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Presentation on theme: "Arizona Department of Weights and Measures CORPORATE EDUCATION 99-Cent Stores 99-Cent Stores."— Presentation transcript:

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2 Arizona Department of Weights and Measures CORPORATE EDUCATION 99-Cent Stores 99-Cent Stores

3 Arizona Department of Weights and Measures These photos were taken at some 99-cent stores in the Phoenix Metro Area. It doesn’t matter which ones we visited. We’ve seen these problems at many different 99-Cent Stores.

4 Arizona Department of Weights and Measures Three of your stores recently failed our inspections because of significant violations of Arizona pricing laws. Because of those violations, 99-Cent Discount Stores faces a number of civil penalties.

5 Arizona Department of Weights and Measures Remember: Civil penalties may be assessed when a stores fails an inspection, though we typically do not impose penalties on the first violations. Civil penalties WILL be imposed if further re- inspections find violations. If they STILL aren’t corrected the size of those penalties will escalate every time we find violations.

6 Arizona Department of Weights and Measures We’re going to show you some photos of problems we found. None of these pictures were staged in any way. Later on, we’ll also take some of your top managers on a walking tour of a store to point out the types of problems we see.

7 Arizona Department of Weights and Measures Keep in mind that these inspections were triggered by complaints from your customers. When your customers complain, they become our customers – and we follow up on every customer complaint we receive.

8 Arizona Department of Weights and Measures We hope that today’s presentation will help you improve compliance at all 99-Cent Discount stores. Our goal is to help you comply with the law, not to collect fines.

9 Arizona Department of Weights and Measures What happens when we conduct an inspection.

10 Arizona Department of Weights and Measures Getting Started First, the Investigator presents his or her documents and goes over the Regulatory Bill of Rights.

11 Arizona Department of Weights and Measures This describes the inspection process. The on-site representative will be asked to sign this form to indicate everything was explained, and they understand what will happen.

12 Arizona Department of Weights and Measures Then we conduct the inspection. Two inspections - Price Posting and UPC - are done together…

13 Arizona Department of Weights and Measures Price Posting

14 Arizona Department of Weights and Measures Price Posting: AAC R20-2-302(D) A retail seller who offers, exposes, or advertises a commodity for sale or rent shall post a definite, plain, and conspicuous price on the commodity or adjacent to where the commodity is displayed. If the price of the commodity is by weight, measure, or count, the retailer shall place the price per weight, measure, or count on the commodity or adjacent to where the commodity is displayed. If a retailer offers a commodity for sale or rent at a price reduced by a percentage or a fixed amount from a previously offered price, the retailer shall place the reduction or reduced price on the commodity or adjacent to where the commodity is displayed.

15 Arizona Department of Weights and Measures Price Posting: ARS 41-2081(F)4 Except as otherwise provided in this chapter or by rules adopted pursuant to this chapter, any package kept for the purpose of sale or offered or exposed for sale shall bear on the outside of the package a definite, plain and conspicuous declaration of: The price, except as provided in subsections K and L.

16 Arizona Department of Weights and Measures Price Posting: ARS 41-2081(K) & (L) K. Instead of each package bearing the price as required under subsection F, paragraph 4, the seller may post the price of the package in bold type that measures no less than three-eighths of an inch on the shelf or display at the point of display of the product. If the price on the shelf or display is less than eighteen inches from floor level, the price shall be angled upward from vertical at least fifteen degrees. L. If the package is offered for sale at a price reduced by a percentage or a fixed amount from a previously offered price, the reduction shall be displayed at the point of display of the package in the manner required by this section.

17 Arizona Department of Weights and Measures Price Posting Violations: How Much Is This?

18 Arizona Department of Weights and Measures The first thing we do is go around your store and select 250 items at random to see if they are properly priced. We’ve been finding a lot of pricing errors at 99-Cent Discount Stores.

19 Arizona Department of Weights and Measures Let’s start with these shelves. These gift- wrap items appear to be 79.99 cents But how much are the Del Rey napkins?

20 Arizona Department of Weights and Measures Since there’s no other price point… We have to assume they’re ALSO 79.99 cents each.

21 Arizona Department of Weights and Measures ‘Top 10 Pricing Tips’: The following can be found in the Arizona Administrative Code (AAC) R20-2-402 (D): “A price posted above the highest item in a vertical location is the price of all items in that location.”

22 Arizona Department of Weights and Measures Finding the right price CANNOT BE a multiple-choice test.

23 Arizona Department of Weights and Measures Here are some candles being offered for sale Are they 99.99 cents? Or are they TWO for 99.99 cents?

24 Arizona Department of Weights and Measures A.R.S. § 41-2081 (C) “A person shall not misrepresent the price of any commodity or service sold or offered … or represent the price in any manner calculated or tending to mislead or in any way deceive a person.”

25 Arizona Department of Weights and Measures So in this case, the lowest price will apply

26 Arizona Department of Weights and Measures Here’s another multiple-choice price. Is this pasta 59 cents a bag… Or is it 29.99 cents?

27 Arizona Department of Weights and Measures Are the Skittles 49.99 cents? Or are they 99.99 cents?

28 Arizona Department of Weights and Measures Are these glasses 99.99 cents each? Or are they TWO for 99.99 cents?

29 Arizona Department of Weights and Measures Is this glass plate 2 for 99.99 cents… Or $1 each?

30 Arizona Department of Weights and Measures By now you should be seeing a pattern: We keep seeing the same problems Over and over At all your stores!

31 Arizona Department of Weights and Measures 99-cent Only Stores should follow the “left-to-right” rule… “Consistency is the key to sign placement. Many retailers use the left to right method for pricing products. When pricing items on a shelf that are priced the same, place the first price sign under the far left most product on the shelf. When a product has a different price make a new sign and place the sign under it. If the product continues for more than three feet, repeat the sign so that your customers don't become confused. It's that easy.” ‘Top 10 Pricing tips, page 7:

32 Arizona Department of Weights and Measures D. The following are not price-posting violations: 1. A price is posted on a shelf where an item is displayed rather than marked on the item individually. 2. A price is posted on the shelf at the farthest left side of all items with the same price for up to 3 feet of shelf space. The price for commodities with the same uniform price code may be more than three feet from the price posted if they are all displayed in the same location. 3. A price posted above the highest item in a vertical location is the price of all items in that location. R20-2-402. Price-posting Inspection Procedure and Violation Exceptions Here are some more pricing tips

33 Arizona Department of Weights and Measures Price Verification

34 Arizona Department of Weights and Measures A person shall not misrepresent the price of any commodity or service sold or offered, exposed or advertised for sale by weight, measure or count or represent the price in any manner calculated or tending to mislead or in any way deceive a person. Price Verification: ARS 41-2081(C)

35 Arizona Department of Weights and Measures The Price Charged At The Register Has to be the price marked on the shelf.

36 Arizona Department of Weights and Measures At ‘Store A’ we “purchased” a case of six one-gallon bottles of water. There was ONE price-point on the case: 99.99 cents. We were charged $6 for the case. That was a $5 OVERCHARGE.

37 Arizona Department of Weights and Measures (This example was from one of your competitors, but it’s similar to what we saw at your store). 99.99 cents

38 Arizona Department of Weights and Measures We picked up a mirror that was priced at 59 cents. But when we went to pay for it, we were charged 99.99… That was a 40-cent OVERCHARGE

39 Arizona Department of Weights and Measures We also picked up some furniture wipes… The shelf price was 69.99 cents. We were charged 99.99 cents. That was a 30-cent OVERCHARGE

40 Arizona Department of Weights and Measures At ‘Store B,’ we tried to buy them for the marked price of two for 99 cents. Remember the glasses? But they charged us 99.99 cents each… For a $1 overcharge.

41 Arizona Department of Weights and Measures And we picked up scouring powder. It was marked at 59.99 cents each. We were charged 99.99 cents…. …for a 40-cent OVERCHARGE.

42 Arizona Department of Weights and Measures And so it went at three of your stores that we recently inspected. There were problems in the prices on the shelf…. …and we were charged the wrong price far too often.

43 Arizona Department of Weights and Measures But as they say in those late-night infomercials… WAIT! THERE’S MORE!

44 Arizona Department of Weights and Measures If a customer says "Hey, that's not the price on the shelf!" what do you do? What is the 99-cents only price-error policy??

45 Arizona Department of Weights and Measures None of your stores had one.

46 Arizona Department of Weights and Measures This is another significant violation

47 Arizona Department of Weights and Measures Pricing Error Policy: ARS 41-2081(M)2 On the request of a consumer, a retail seller shall provide a written statement of the retail seller's policies regarding errors in pricing.

48 Arizona Department of Weights and Measures 4. The Department shall issue a warning to a person who does not have a written price-error policy. The Department shall impose a $500 civil penalty if the person does not have a written price-error policy upon reinspection. R20-2-104. Administrative Enforcement Action I. Price verification.

49 Arizona Department of Weights and Measures Here are the Inspection Scores for the three stores we checked:

50 Arizona Department of Weights and Measures Store A: Price Posting: UPC Scanning: 88 percent. Fail 92 percent. Fail 4 OVERCHARGES 30 PRICING ERRORS No price-error policy Fail: ESTIMATED -* CIVIL PENALTIES: $300 T0 $1,200

51 Arizona Department of Weights and Measures Store B: Price Posting: UPC Scanning: 96.4 percent. Fail 96 percent. Fail 2 OVERCHARGES 9 PRICING ERRORS No price-error policy Fail $600 to $1,100 ESTIMATED -* CIVIL PENALTIES:

52 Arizona Department of Weights and Measures Store C: Price Posting: 89.6 percent. Fail 26 PRICING ERRORS No price-error policy Fail $2,600 to $3,000 ESTIMATED -* CIVIL PENALTIES: Unpaid civil penalties: $950, more than one year overdue!

53 Arizona Department of Weights and Measures We found far too many violations during our inspections.

54 Arizona Department of Weights and Measures As a result, THESE STORES MAY FACE CIVIL PENALTIES TOTALING… $3,500 TO $5,300!

55 Arizona Department of Weights and Measures And remember: We WILL be reinspecting these stores!

56 Arizona Department of Weights and Measures I. Price verification. 1. The initial inspection of a retail location for price verification is for educational purposes and an enforcement action will not be imposed for a violation identified during the initial inspection. 2. The Department shall issue a stop-sale, stop-use tag to a person who fails a price verification reinspection if the violation cannot be corrected within 30 minutes of the Department completing the reinspection. a. The Department shall impose a $100 civil penalty per violation on a person who fails a reinspection if the Department finds more than one item at more than its posted price. b. The Department shall impose a $200 civil penalty per violation on a person who fails a second reinspection. The Department shall increase the per violation civil penalty imposed by $100 for each subsequent reinspection until the violation is corrected. R20-2-104. Administrative Enforcement Action

57 Arizona Department of Weights and Measures J. Price posting. J. Price posting. 1. The initial inspection of a retail location for price posting is for educational purposes and an enforcement action will not be imposed for a violation identified during the initial inspection. 1. The initial inspection of a retail location for price posting is for educational purposes and an enforcement action will not be imposed for a violation identified during the initial inspection. 2. The Department shall issue a stop-sale, stop-use tag to a person who fails a price posting reinspection if the violation cannot be corrected within 30 minutes of the Department completing the reinspection. 2. The Department shall issue a stop-sale, stop-use tag to a person who fails a price posting reinspection if the violation cannot be corrected within 30 minutes of the Department completing the reinspection. 3. The Department shall impose a $50 civil penalty for each inspected lot not priced if a person fails a reinspection with a score of less than 96 percent. 3. The Department shall impose a $50 civil penalty for each inspected lot not priced if a person fails a reinspection with a score of less than 96 percent. 4. The Department shall impose a $100 civil penalty for each inspected lot not priced if a person fails a second reinspection. 4. The Department shall impose a $100 civil penalty for each inspected lot not priced if a person fails a second reinspection. 5. If the Department receives and substantiates a complaint about a person against whom the Department took an administrative enforcement action under subsection (J)(2) within the 60 days before the date of the complaint, the Department shall issue a stop-sale, stop-use tag and impose a civil penalty that is $100 more than the civil penalty that the Department previously imposed against this person. 5. If the Department receives and substantiates a complaint about a person against whom the Department took an administrative enforcement action under subsection (J)(2) within the 60 days before the date of the complaint, the Department shall issue a stop-sale, stop-use tag and impose a civil penalty that is $100 more than the civil penalty that the Department previously imposed against this person. R20-2-104. Administrative Enforcement Action

58 Arizona Department of Weights and Measures 4. The Department shall issue a warning to a person who does not have a written price-error policy. The Department shall impose a $500 civil penalty if the person does not have a written price-error policy upon reinspection. R20-2-104. Administrative Enforcement Action I. Price verification.

59 Arizona Department of Weights and Measures IT’S NOT JUST THE LAW, IT’S GOOD CUSTOMER SERVICE! BUT REMEMBER: Our goal is to help you comply, not to collect civil penalties

60 Arizona Department of Weights and Measures Questions?


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