SAKS 5 Avenue Jewelry Drama

[jaytag]

This is very interesting. I will post the story and then comment.
Should Saks Fifth Avenue sue? Or should its customer pay up?
Posted by Laura Gunderson/The Oregonian November 17, 2008 11:10AM
Categories: Past columns with updates
Perusing the Saks Fifth Avenue jewelry counter one Sunday in late September, customer Emily Pickering hovered over a set of designer earrings and a matching brooch.

Two sales clerks at the downtown Portland store showed her the gold and diamond earrings and the 8-carat diamond brooch and told her the set was $28,000, according to a lawsuit filed by Saks last week in Multnomah County Circuit Court.

Pickering agreed, paid for the jewelry and headed back home to Seattle.

Problem was that the earrings and brooch weren't a set, according to Saks' complaint. The upscale department
More in next post

 

[jaytag]

Rest of the story

The upscale department store discovered the next day that the brooch's price tag -- for $48,000 -- had fallen off unbeknownst to the sales people.

Saks' general manager, Bill Halleran, called Pickering and, after leaving several messages, got ahold of her and described his store's mistake. She should have been charged $76,000, the court filing said Halleran told Pickering. He then asked that she either pay up - at a thank-you rate of several thousand dollars off the brooch's original price - or return it.

Pickering ultimately refused, the court documents show.

Saks sued Pickering seeking the price of the brooch and its lawyers' fees. Pickering didn't return a call to The Desk, and Saks' attorney refused to comment on the record.

Let's be clear, the case is obviously an extreme. Yet, at its glittering 18-carat heart lies a question surrounding evenmore mundane consumer transactions - something more akin to customers arriving home from the grocery store to find they weren't charged for the ketchup.

The question: Just where does the responsibility begin and end, of a retailer to price goods and charge customers accordingly begin and end? At the same time, what do customers owe a retailer who's made an honest mistake?

The Desk plans to keep tabs on wherethe Saks case goesand will provide an update when there's a legal conclusion. In the meantime, The Desk thought it would be interesting to hear what local experts - consumers, retailers and evena consumer protection lawyer - have to say.

 

[jaytag]

Ok my two cents

I know the question posed is one of morals, however, I am in favor of the customer. Being in retail mgmt, I have been a strong supporter of training for retail employees. It is the single most lacking aspect in Retail today. So my thoughts. If there were two sales associates that sold the jewelry as a set, then SAKS should have better trained the associates to be proficient in the selling of the jewelry. As many have said before, retailers have built in a percent of shrinkage every year to cover this. As well as every shortage plan includes better training, but yet companys never put the funds to support it. It is well known that they would rather count it as shortage, than spend the money as training and development. Any other thoughts?

 

[toggleswitch2]

But two get one free!

Errors and omissions insurance anyone?

If TWO employees said agreedthat the charged p[rice was what the price actualy was and the computer didn't give a unit count (i.e. "one set of two pieces" instead of "one set of three pieces"), I'd say the custoemr has the right to refuse any uptick in charges and/or to return the piece.

Per the UCC (Uniform Commerical Code) Goods moved freely in exchange for consideration (money, usually). The law normally does not look at the extent (value) of the consideration or the goods for that matter.

Once, while in college selling women's shoes, I accidentally charged a woman $399.99 instead of $39.99. She came back the next day all panicky. I apologized profusely and she did too in that she did not catch the mistake either. No fuss no muss. Return and re-buy.

Does anyone think the customer knew the extent to which (s)he was getting a bargain?

 

[petek]

I'd side with the customer. They made a purchase in good faith and the store made and honest mistake, they have insurance. A retail sale is a legal contract between the buyer and the seller and provided there is no jiggery pokery involved the sales contract is fulfilled the second the store literally accepts your payment into their hands.

 

[danemodsandy]

I'm Siding...

...With Jaytag here. Before I began writing, I spent many years in retail. During my time, retail went from a profession to a job of last resort, due to short-sighted cost-cutting. Highly proficient, well-trained people were cast aside in favour of minimum wage "warm bodies." Considering myself something more than a mere warm body, I left.

If retailers would like for "the good old days" to come back, they need to bring back the good old people, and treat them with good old respect and good old commission plans for their good old knowledge and good old hard work.

Saks is a luxury store, and should have been spending the money to train professional-quality people on their merchandise; in any properly-run store, no sales-floor employee should have been unaware of the price of a $48,000 piece of jewellery.

However, the 48 grand loss on the Saks brooch is nothing compared to how much business walks out the door of Saks - and many other stores - because no one is able or available to assist customers. Saks needs to take its loss, learn its lesson, and return to proper salesperson training as a means of both trimming its losses and boosting revenues. Most retail today is run as a means of enriching shareholders and management at the expense of regular employees, suppliers, and consumers. As the lights go out in one retail chain after another all across America, you'd think someone would figure out they need to return to selling, not merely standing there and swiping credit cards.

I hope a judge rules that Saks should eat the 48 grand because it was negligent in not training employees correctly and in not having redundant means for employees to check the price of high-dollar items. It used to be that you had to check an expensive item's price tag against a master price list before completing a transaction, and initial the list to show you'd checked it. Warm bodies don't know about such things, I guess.

 

[danemodsandy]

I Must Add...

...That I think Mrs. Pickering was probably aware that something was at least "too good to be true" when she was quoted $28,000 for the set. People who are "into" jewellery are highly aware of prices and value. Unless this was the lady's first purchase of fine jewellery, she had to have known that $28,000 was a suspiciously good deal.

Still, even with that factor, Saks is at fault for not having better-trained personnel and better controls on its fine jewellery inventory.

 

[whirlcool]

It seems like we agree.

She asked the price, they told her what it was, she paid it, the items are hers. Plain and simple. And you are right, the salespeople should have been aware of the high value of these items.
Saks made the mistake, and now they have to pay for it.

I do feel sorry for the department store manager, I am sure he will hear it but good from upper management.

 

[saltysam]

I do feel sorry for the department store manager, I am sure

I also agree with JayTag.....I was in retail management for 18 years......3 of those years were spent as the fine jewelry manger for Famous Barr (Now Macy's) Every item in the fine jewelry dept. is inventoried and especially the high priced items must be accounted for every single day.. The fact that these sales persons did not know that these items were not a set is completely beyond comprehension. These gals screwed up in a major way....no doubt they have probably lost their jobs and I would assume the store manager has his butt in the wringer also. I also agree with everyone else on the fact that the people that work retail today are not trained anywhere near to the level they should be....This is one reason I do not frequent most major department stores because usually one can not find anyone to give them assistance and if they are lucky to get someone to help they are quite often unknowledgable and rude. Sak's should eat this one without question...It will be interesting to see how this situation pans out.........
Mark

 

[brettsomers]

The hotel industry is the same. Having only worked within it for nine years, I can already see a shocking decline in standards. Guests paying 279 per night. Hotel at one hundred percent occupancy and nobody to park the car and no bellman and nobody at the front desk and all to lower staffing costs!

 

[dalangdon]

I come down solidly on the side of the customer, whether she knew she was getting away with something or not. Although I share the fear that the manager will get scapegoated for this. It really is a matter of training and development - something corporations pay lip service to, but won't actually do.

Anyway, you can never trust Saks. I hear they have some awful women working behind their perfume counter. They'd just as soon take your man as sell you a bottle of Summer Rain.

Or am I thinking of Black's Fifth Avenue.....

(Face it: "The Women" had to work their way in here sooner or later)

 

[soapnsuds]

People are just plain crazy!

Reminds me of an experience I had with furniture store here in Sacramento when I bought my house 4 years ago.
I had bought my house (first one!) and I had put a little over $10,000 aside to furnish my house. I lived in a small studio for about 9 yrs. I had a bed, some bookshelves, all my kitchen stuff and a few other things. I sold everything but the kitchen stuff.
So I went on a shopping spree to furnish my new house (it's a small two bedroom). So I shopped and paid cash for everything. I went to a store here in town and bought a sofa, dining room set, entertainment center, bed, dresser and nightstands from one store. I gave them $2000 as deposit because that's all the cash I had on me. (I wasn't expecting to find some much there) and then I would paid the rest on delivery. The girl wrote up all the stuff on invoices, and applied my deposit to towards each item to use it up..for instance the table was $800, so she applied $800 of the $2000 to the table and paid that off. then she applied however much to the next item..and then the balance was due. The next day, I went back as I decided I didn't like the sofa so much. So she had to re-do the invoices. For whatever reason, I can't remember now, she couldn't do it then, she would have to do it on Monday. so I said that was fine, just call me with the total and I would pay the balance. In the mean time, I transferred a few thousand over to my checking to cover the difference for when she called me. So come Monday, she calls me with the new total. I give her my debt card number and that's that. She charged me the amount, furniture delivered a week or so later and that's that. I'm happy, life is good. That was Sept 2004.
Now skip ahead to june of 05. I get this letter in the mail from the furniture place. In essence saying, 'we audited our books and found we didn't charge you for your dresser. Pay the amount now or we will take you to collections!'
I'm like "WTF?!" and I tossed the letter away I was so pissed. Don't send me a letter, acting like I did something wrong and I'm some sorta deadbeat! A few months later another letter and then another. So finally dug out my paperwork, that I never even looked at, and added everything up, added my the money I paid and sure enough, they didn't charge me for the dresser. I marched down to the store and demanded to speak to the store manager. Long story short, I said 'you all made a mistake, then you send me a nasty letter, acting like I cheated you! If you would have called me and said 'Laurent, we're sorry, but we made a mistake and didn't charge you enough....I would have paid. I don't want anything for free and I realize people make mistakes. But here's the problem; one, you send me a nasty gram and I find that rude. Second, I had a budget of $10,000 to spend on furniture for my house. I've spent that money now and there is nothing left. I'm on a budget and I can't afford to pay $1000 for a dresser now, 9 months later. He said the driver was supposed to have collected the money on delivery. I said he never said a word and no-one every called me to say I owed more and to pay it when the driver gets there. Sorry.
So they kept sending me letters and threatening me..I knew they couldn't do anything to me. I paid cash and it was there own damn fault. I would have gone to small claims court no problem. I registered a complaint with the BBB, and called my local news station's consumer help line...never heard from them again!
I don't feel sorry for them. I think they where rude as hell, acted as if I walked in the store and stole the dresser! I will never shop there again!
So I'm all for the lady and the jewls. I worked for Neiman Marcus as an asst. manager for womens accessories...I know the mark up and it won't cost Sac's even half that much in the loss...buck up and pay attention to what you're doing. I can't believe the manager had the balls to call the lady!

Bottom line, you better add your stuff up right!

 

[angus]

I can guarantee you that even if the customer had raised the question about how this seemed to be a great price, the sales help would never have caught this. Even in the most high end stores, knowledgable sales people have been replaced by robots that simply process the transactions.

If Saks or Neimans, or Bloomingdales or whatever can't ensure their employees know what they are doing, it is NOT the customer's responsibility to do their job for them. Just like everything else in the world today, we are expected to know more than the "experts". Ridiculous - if I were that customer, I would not only refuse to pony up the rest of the $$$, I would counter sue Saks for harrassment.

It is high time that coporate America stops behaving with such hubris.