March 21, 2014 / 7:56 AM / in 4 years

Watchdog closes price probe into UK furniture and carpet firms

LONDON, March 21 (Reuters) - Britain’s competition watchdog has closed an investigation into five furniture and carpet retailers, including market-leader Carpetright, after the firms agreed to change pricing practices that it said could deceive consumers.

The Office of Fair Trading (OFT) has taken a tougher stance against retailers to ensure consumers can trust their prices and communications and in August last year ordered the retailers to stop misleading shoppers by artificially ramping up the value of discounts during sales promotions.

The OFT said on Friday five companies, SCS, Carpetright, Dreams, Furniture Village and Harveys/Bensons for Beds had all made changes to their reference pricing practices. A sixth firm, DFS, was cleared in December after making price commitments.

Reference prices are used by retailers to advertise a bargain to shoppers by comparing a lower current price against a higher past price.

The OFT said in August the retailers had artificially inflated reference prices on items to promote discounts that were not genuine, making it seem better value than it was.

“Retailers advertise bargains and discounts by referring to a previous or future higher price. It’s a powerful marketing tool which, when used properly, provides a helpful and easy way to demonstrate to shoppers the value of discounts and savings,” OFT director Gaucho Rasmussen said.

“We are therefore pleased that these retailers have confirmed their commitment to using genuine prices.”

Carpetright, Britain’s biggest floor coverings retailer, said in a statement it was pleased the OFT had welcomed its commitment to transparent pricing. (Reporting by Neil Maidment; editing by James Davey)

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