Look Sharp fined almost $300k for misleading pricing, ignoring complaints

Look Sharp sells a range of costumes and other consumer goods. Photo / Nick Reed

Discount store Look Sharp has been fined in Auckland District Court after pleading guilty to making misleading representations about product prices and consumers’ rights under the Consumer Guarantees Act.

The breach of the Fair Trading Act resulted in a fine for Walond Ltd, trading as Look Sharp, of $292,500.

Commerce Commission general manager Vanessa Horne said Look Sharp had frequent and widespread pricing errors over a substantial period, “some of which meant customers paid as much as 33% more for a product than the advertised shelf price”.

“Incorrect pricing was so widespread by late 2022 that Look Sharp started to display signs in a number of stores that stated there may be discrepancies between label prices and actual prices.”

She said incorrect pricing had financial impacts and could lead to consumers feeling pressured at the check-out, which can cause stress, frustration and loss of confidence.

The commission was alerted to the discrepancies by a single-parent consumer who was financially struggling and emphasised that “every cent counts within my household budget”.

The commission warned Look Sharp Discount Store Ltd in 2024, a separate entity that operates the Look Sharp online store, for representations made to consumers about their rights under the Consumer Guarantees Act.

It believed those representations likely breached the Fair Trading Act.

Look Sharp also made representations between January 2021 and August 2023 about customers’ rights to refunds and exchanges for faulty products, directly contradicting the Consumer Guarantees Act.

The representations restricted the timeframe for returns on faulty products to seven days and prohibited refunds and exchanges for specific product categories.

The business also falsely claimed Covid-19 restrictions prohibited all returns and exchanges.

“Look Sharp is a large trader, with 20 different stores and a revenue of up to $44 million a year. These breaches ultimately originated in Look Sharp’s head office and reflected a major gap in processes,” Horne said.

“While we’re glad Look Sharp has taken steps to improve its compliance systems, we’re disappointed that no steps were taken before the commission intervened — despite consumer complaints to Look Sharp.”

A spokesperson for Look Sharp acknowledged that some representations made to customers breached the Fair Trading Act.

“Most of the breaches related to measures Look Sharp implemented as a result of the Covid-19 pandemic. Those measures were not implemented as well as they should have been.”

“Look Sharp was disappointed to learn of the errors made, rectified them quickly, and has implemented measures to ensure such errors do not occur in future. The company cooperated fully with the Commerce Commission and entered guilty pleas at the earliest opportunity.”

Look Sharp accepted the fine and said it sincerely regrets any impact on its customers.

“Look Sharp always puts customers first, and we will continue to work hard to deliver a great shopping experience for our customers.”

Tom Raynel is a multimedia business journalist for the Herald, covering small business and retail.