Dive Brief:
- Family Dollar will pay $63 million to settle claims from the Federal Trade Commission and 17 states that the discounter “routinely charged customers more at the register than the prices displayed on shelves, price tags and advertisements,” the FTC announced Thursday.
- In addition to the fine, Family Dollar has agreed to implement a pricing accuracy program that will be “independently assessed and annually certified,” the FTC said.
- “We will continue working cooperatively with the FTC and state agencies as we fulfill the requirements of the agreement and provide customers with clear, accessible information about what the settlement means for them,” Family Dollar spokesperson Janella Escobar said in an emailed statement Friday.
Dive Insight:
Some retailers are exploring dynamic pricing options that, whether or not they’re unlawful, are unnerving financially stressed consumers. Meanwhile, government consumer protection advocates on the state and federal levels are cracking down on deceptive pricing practices.
“The FTC is committed to ensuring price transparency and fairness so consumers can make informed choices,” Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said in a statement Thursday. “Today’s order will ensure Family Dollar stops deceiving consumers about its prices and returns money to consumers harmed by these practices.”
The pricing practice at Family Dollar cost shoppers millions and ran afoul of consumer protection laws on federal books and in Alabama, Arkansas, Colorado, Florida, Illinois, Iowa, Kansas, Louisiana, Mississippi, Nebraska, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, Utah and Wisconsin, per court documents.
As part of its agreement with regulators, among other measures, Family Dollar must prominently display its pricing policy next to store registers; institute procedures that ensure point-of-sale systems don’t update to higher prices until they are advertised appropriately; monitor that advertised prices are accurate; train store employees and others up the chain, at least annually, on how to ensure accurate prices; honor the lowest advertised price; and correct inaccurate prices immediately.
The company’s spokesperson said Friday that it’s “focused on strengthening pricing accuracy across our stores and maintaining our customers' trust.”
“Family Dollar prides itself on providing convenient, close-to-home stores where customers can shop for everyday essentials at affordable prices,” she said. “We take our responsibility to deliver a positive shopping experience seriously.”
The news of this settlement comes on the heels of a case brought by the FTC and 20 states last month, alleging that Dollar General, similarly, regularly charged more at the register than the prices it displayed elsewhere. In that case, Dollar General has acknowledged “occasional price discrepancies” and says that it aims for complete pricing accuracy.
