I felt like we’dbeen conned...
OPINION: We were a bit blown away by the mark-up on awall switch an electrician fitted for me.
Not having paid asmuch attention as we should because it was such a small job, we got in an electrician, part of a city-wide group, to replace a few cracked and broken sockets and switches.
There was a high call-out rate, and a high hourly labour charge, and we wrongly assumed that would bewhere the company made itsmoney.
But on the bill, one $100 switch had a $30 margin added.
It made me pretty angry. The sparkie was quick, polite and efficient. I was happy with that, but I felt like we’d been conned. Was I right?
I felt the company telling me its labour fee was $85 was misleading, as the real cost of labour was padded out by a hidden charge.
I’m used to being charged huge sums for simple parts by Bunnings and Mitre 10, but even by their standards, it seemed extremely high.
The bill didn’t indicate any kind of mark-up had been added.
It had the labour and call-out fees itemised clearly, but simply listed a charge for each of the parts supplied.
Why hide an honest charge, I thought? Why not split it out as a ‘‘parts charge’’ or something like that?
So, we queried it, and the company removed the mark-up.
A small victory, possibly, but I felt itwas fair for the company to acknowledge that we felt duped.
It turned out, when I went back to check, that the company did disclose on its website that it added a small mark-up to materials.
I felt a bit mollified but I had questions. Was a 30 per cent mark-up small? Should I have been expected to read every word on thewebsite and then query it? Why not be clearer with me on the bill? Had I been an incautious consumer?
I called Consumer NZ’s chief executive Jon Duffy to understand the law, and get a perspective.
In cases where no price was agreed in advance, the Consumer Guarantees Act requires prices to be ‘‘reasonable’’, he says.
In our case, prices for the parts had not been agreed in advance. We thought wrongly that the call-out and labour fees werewhere the company made its money.
As with the word ‘‘small’’, the word ‘‘reasonable’’ is up for debate. Is a 30 per cent mark-up
reasonable? Perhaps that’s the going rate in the industry.
Duffy told me best practice would have been for the company to be clearer in its communications, itemising the costs to the homeowner as callout fee, labour, parts, and the charge on the parts.
This is a no surprises approach, where everyone knows where they stand from the off.
Best practice for the homeowner would have been for us to get quotes from several companies, check them, query the pricing, and then make our decision.
He’s right. We consumers have a role to play in insisting on transparent pricing.
It’s hard for a two-worker household to play their part all the time but, unless enough of us do, there’s no pressure for companies to change.