furniture retail fiasco
12 September 2008

Gloria Sithole, a cashier at the Hungry Lion takeaway in Wynberg, Cape Town, and one-time domestic worker for supermarket mogul Christo Wiese, is fuming about how retailer Lewis tried to fool her into buying furniture.  Sithole describes how her problems began when she went into the Lewis store in Wynberg to buy a television set in November 2007. "They said I couldn't get a TV, because I'm in arrears on my TV licence. So I left, thinking that was the end of it," she says.  "But a few weeks later, I was in a taxi and my phone rang. My brother-in-law told me they'd delivered a Sansui DVD player I'd never asked for."

Sithole called the store manager, and told him to fetch the R1700 DVD player. But it remained in her house for two months. "When I went to see the manager, he pulled out a docket saying I had supposedly bought a DVD player, a TV stand and plug for R5000. I was meant to pay R440/month over 30 months, but I'd never even discussed these items. It simply wasn't true."

This R5000 payment dwarfed Sithole's salary. "I couldn't afford it. I have one son, and I'm helping my [unemployed] sister look after her three kids," she says. Sithole was hassled for months for repayments but luckily she didn't do what others in her position have done: open the packaging and post-facto sanction a purchase she never made. Instead, she got Lewis to collect the DVD.

This is one example of the dirty tricks in a furniture retail industry that has been preying on the uneducated poor for years. The worst abuse takes place under the banner of "insurance", which the FM scrutinises in this article.

Now, under pressure from the National Credit Act (NCA) and a new zeitgeist of consumer protection, retailers like Lewis, JD Group and Ellerines are being forced to change their ways. And the regulators are taking a keen interest.  Financial Services Board (FSB) CEO Dube Tshidi confirmed this week that his regulator had already probed "market misconduct" at JD Group this year. This was in response to a case where domestic worker Thuliswe Gumede was misled into buying various insurance products and "add-ons".

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Rob Rose, http://secure.financialmail.co.za