Exploitation of

Customers
By Avnay Khanna
Exploitation of Customers
• Any person who buys anything in the market or pays for any
service is a consumer. When a consumer is cheated in any way,
either by the shopkeeper or the producer, by giving him poor
quality or adulterated goods or by charging more price for a
commodity or a service, it is called consumer's exploitation.
Factors causing exploitation of consumers
Reasons or factors causing exploitation of consumers are:
(1) Limited information
(2) Limited supplies
(3) Limited competition
(4) Low literacy
(5) Lack of bargaining power
(6) Irregular prices offered
(7) Misleading advertisements
(8) Lack of unity
(9) Cumbersome and time taking legal proceedings.
Methods of exploitation
Some of the common methods adopted by the manufacturers and traders to exploit the
consumer are as follows:
1. Underweight or under-measurement
2. Goods or services of substandard quality
3. Overpricing
4. Articles harmful for health
5. Unsatisfactory after-sales services
6. Sale not in accordance with predetermined conditions
7. Scarcity in service sector.
8. Rough behavior with the consumer and undue conditions
9. Cheating in choice
10. Faulty equipment's
11. Artificial scarcity
12. Incomplete or insufficient information.
Methods of exploitation
• 1. False Advertising- making deceptive and misleading claims in the advertisements
of the products.

• 2. Deceptive Pricing- Very often traders charge deceptive and high prices from their
consumers than the prescribed retail price.

• 3. Deceptive Billing- It may sometimes happen that traders sell fake or duplicate
goods in the name of genuine goods.

• 4. Misuse of Customer Data- The information or data collected by the customers at

the time of sale can be misused.

• 5.Substandard quality The traders may cheat the consumers by degrading the quality
of the product and selling those in the market like expired products, defective items.
Underweight or under-measurement
The Weights and Measures Act sets out rules for selling goods by quantity. It’s
there to make sure businesses sell correct quantities, and you get what you
pay for. Goods sold by weight, volume, length or number must be:
• accurately weighed, measured or counted
• clearly labeled with the correct net quantity.
Goods bought by weight or measure must be sold to you by net weight or
measure. This means the weight of any packaging must be excluded from the
weight or measure statement.
Examples of goods sold by weight or measure include:
• coffee beans sold by kilo
• firewood sold by cubic meter
• potting mix sold by liter
• railway sleepers sold by number.
Faulty Products
If a business sells you a faulty consumer product, you can ask for
the good or service to be fixed under the Consumer Guarantees Act
(CGA). If a product fault is minor and can be fixed, the retailer can
choose to repair the item, replace it, or refund your money.
This also applies to new or second-hand products bought through:
• auctions
• websites
• an agent or broker who sells on behalf of someone.
Private sales are not covered by the CGA e.g. buying from a private
seller (not traders) on sites like TradeMe. 
Repairs, Replacements and Refunds
Repairs, replacements and refunds are known as remedies. You can ask for a remedy under
the Consumer Guarantees Act (CGA). You should be able to get a repair, replacement or
refund if:
• products or services don't do what they are meant to, or are defective
• products or services are different from their description, eg on packaging or in advertising
• products don't match the sample or model you were shown
• products or services are not reasonably fit for a particular purpose you told the seller about
• the retailer did not have the right to sell the product
• delivery is late or never arrives, or products are damaged in transit.
Consumer products are things bought from a business for personal or household use.
The likelihood of getting one of these remedies depends on:
• what types of products or services you bought, and their uses
• what the seller told you about the product or service
• how you paid
• if you bought them from a business or privately.
Misleading Prices or Advertising
Under the Fair Trading Act (FTA), you have the right to clear and
accurate prices for products and services, and factual advertising.
• It is illegal for a business to mislead or deceive you about the
things they sell. This includes:
• writing or saying anything false or misleading about products
or services, including in advertising
• making claims about products if they don't have evidence to
back them up
• unfair sales practices like bait advertising, which is when
businesses lure you in with cheap items that are unavailable,
then offer a more expensive item instead.
Artificial Scarcity
• Consumer exploitation is taking advantage of consumers. The
term "hoarding" may include the practice of obtaining and
holding resources to create artificial scarcity, thus reducing the
supply, to increase the price, so that they can be sold to
customers for profit.
• Thank You