by Mike Masnick

Filed Under:
pricing, scams, warranty

office depot

Office Depot Employees Blowing The Whistle On Outright Scams

from the reputation-is-a-scarce-good dept

For many years, there have been stories of various shady online electronics (especially camera) retailers (many of whom are based in the same neighborhood in Brooklyn). The main scam is to offer super cheap prices on cameras to get you "in the door" (either online or in person), and then focus on trying to sell you all sorts of massively over-priced add-ons and warranties. If you turn them down, they suddenly "discover" that the original product you ordered is out-of-stock. At times, over the years, various authorities have cracked down on such resellers, though they often pop right back up under a different name.

Still, folks who know the business were well aware of such shady companies and often knew to avoid them... but it's a bit different to find out that some large brand name retailers appear to be doing the same. Laptop Magazine is reporting on a series of whistle-blowing employees at Office Depot, detailing how they pulled off similar scams. The typical "oh, that's out of stock" trick is apparently quite common, but it even gets more advanced, with some employees creating photoshopped price signs, in order to "hide" the price of an expensive warranty add-on in the "list price" for a computer. These practices are quite illegal, and it looks like the report might trigger some FTC interest, especially given the multiple reports, suggesting that this isn't just a few rogue employees.

It does make you wonder what Office Depot was thinking. The obvious answer is: "anything for a sale," but that doesn't tell the whole story. Sooner or later, companies that do this sort of thing are going to get caught -- and when that happens (beyond the fines), the damage to a company's reputation can be massive and debilitating. It just seems like the cost of being outed is so high, it's ridiculous that any company would encourage such behavior.

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  1. identicon
    Weird Harold, 19 Mar 2009 @ 8:34am

    Re: Re:

    The best commission systems are set up to reward the employees for doing something that is good for the company AND good for the customer.

    Super high commissions on upsells just creates an adversarial sales atmosphere. It isn't good for the customer, it is probably not very comfortable for the salesman, and in the end, the company itself suffers.

    I have walked out on retails more than once who have tried to pile crap on the sale, knowing that they are trying to make cash in their pockets with little concern for me. I would rather pay a slight bit more down the road at the place that doesn't have big sales commissions (1/4% on everything) but pays their employees well enough that they are happy to work and get the job done.

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