Remember Your Consumer Rights When Dealing With Franchises

Consumer rights, especially as they relate to refunds and replacements are an evergreen topic here at Lifehacker. It’s worth remembering when purchasing goods, though that your contract with a business might not be as widespread as you think.

Picture by Richard Kendall/Getty Images

Just after Christmas, an old friend of mine approached me for some advice, because she’d bought a product from a Harvey Norman store that most definitely didn’t work as advertised.

Pretty straightforward, you might think, because Australian consumer law is quite clear on this topic. If goods purchased aren’t fit for purpose, you’re entitled to a refund or replacement.

There was just one problem; she’d purchased the goods from a Harvey Norman far from home, and her local store had refused to offer her the refund she’d gone in for. It wasn’t a small item, and this was inconvenient, to say the least. Time, she presumed, to call in the ACCC or similar.

Unfortunately for her, I had to tell her that it wasn’t that simple, and that’s largely due to the business model being used.

Harvey Norman operates on a franchise model, and that means that individual stores are just that — individual stores. Australian consumer law is pretty specific in terms of refunds and replacements, because the contract of sale that you enter into is with the business you’re buying from.

It can be confusing, because each Harvey Norman store is laid out mostly identically, and that could make you think that they’re all company stores. But they’re within their rights to refuse refunds made at different stores, because they didn’t actually sell you the goods in question.

Which isn’t to say that Harvey Norman franchisees always get these things right.

CHOICE recently found that a number of big box retailers (including Harvey Norman) frequently got consumer rights wrong when questioned on them, and a number of Harvey Norman Franchises were heavily fined for misleading action in this regard at the start of the month.