Shops accused of making billions from unfair tactics

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The Independent Online

Shops are using psychologically misleading tactics to trick the public out of billions of pounds, the business watchdog has warned.

In a report today, the Office of Fair Trading found increased use of seven dubious sales techniques, which distorted markets and undermining competition.

Shops using "bait pricing" advertise very limited stocks of a bargain in the hope frustrated shoppers will buy other goods, while exponents of "drip pricing" add taxes, credit card fees and other charges during the transaction. Bogus "time-limited" offers put undue time pressure on consumers.

In Advertising of Prices, the OFT found the tactics were highly effective, even among the numerate. Last year it estimated airline websites' failure to match headline fares cost the public £131m a year. Across the economy, it estimated the tactics cost "billions of pounds a year".

The watchdog is understood to be particularly concerned about repeated sales at out-of-town DIY, carpet and furniture stores. Some high street retailers could also find themselves under the spotlight. Marks & Spencer courted controversy this week by quickly selling out of its own-label Louis Chaurey Champagne, cut from £30 to £10.

Without mentioning any names, the OFT said there was evidence tactics "pioneered" on the internet had spread to the high street, saying it wanted to eliminate them before they became commonplace.

"Our job is to make markets work well for consumers and we are concerned this is a growing practice," said chief executive John Fingleton. "We will bring enforcement cases... from now on businesses are on alert that we will alight on them."

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