Game of Discounts – Do you know that you are being taken for a ride ?

I overheard a conversation over lunch in my office canteen, where in one person said that when he went to purchase Crackers for Diwali, they were offering 90% discount. He jokingly said “why not offer the remaining 10%” also. The box mentioned MRP Rs.5400/- 90% OFF – Rs.500/- Another one MRP Rs.9000/- 80% discount – Rs.1800/-

I remember when I took a stroll at the Brigade Orion Mall, the Pheonix Mall with my foreign relatives and friends, they too were shocked and pleasantly surprised. Every shop (belive me every one of them) were offering 50%  discounts or Buy 1 take 1 free.

Mind you, they are were all top brands and Global Brands too, not cheap local stuffs… the likes of Levis, Wrangler, Allain Solley, Lee Cooper, Lee, Color Plus, Arvind Brands, Reid & Taylor, Nike, Puma, Addidas, Bata, Pantaloon, Woodlands etc.

Till some time ago, it was only the Indian local vendors who were resorting to this gimmick to attract customers. But this time even the Global brands have adopted this tactic to attract reluctant customers.

So are these vendors really passing off these discounts to the customers. You must be kidding. They are just taking you for a ride and a looooooooooooong ride.

We went in to check the prices. One shirt price tag said – MRP Rs.2600/- 50% off – Rs.1300. Another Jeans price tag said – MRP Rs.3800/-  50% off – Rs.1900. One Shoe’s price tag read – MRP Rs.5400/- 50% off – Rs.2700/- and the list goes on.

These are for all occasions the real price. They have just upped the price and then discounted them to their original value. This was actually validated to me by an ex HR Manager of Big Bazaar. Most of them would never buy them at their MRP.

It was funny to see some shops display “Original discounts”, thus giving away the trick of the trade.

I had recently been to Nasik with me colleague to visit our factory. Our HR friends told us that on our return back to Mumbai we could visit the American Tourister factory enroute and that they have a factory retail outlet over there. We were all enthused as we felt that we could pick up some good Luggages at a cheap price. When we did reach the place it was pouring and it took some effort to get inside the factory and the store. 

To our disdain, we were in for shock. The same trick. They had jacked up the price to exhorbitant levels – MRP – 9000/- 50% Off – Rs.4500/-MRP Rs.11000/- 50% discount – Rs5500/- and so on. They were selling at the same price the Retail stores were selling in the cities.

And recently I was tempted to buy a LED 55 inch TV and again went on a exploration drive to check out the prices. One LG 55” LED Smart TV – MRP Rs.201,000/- Ezone offered at Rs.170,000/- Croma offered at Rs.165,000/-, Girias was offering at Rs.155,000/- , LG Shoppe at Rs.149,000/- and another wholesale dealer at Rs.145,000/- I am sure that if I pulled out my Credit Card or dangled a wad of notes the prices would have dropped further.

The same with furniture's. Look at the number of advertisements offering furniture's at 70% discounts.

In the past these discounts used to be restricted to festive seasons or sometimes end of season. But to my surprise I find most of them are offering year round discount sale.

In all theses cases whether they are crackers, clothes, shoes, TV, Furniture etc, the manufacturer is fooling the gullible customers or taking them for a ride or they are stacking up huge margins (anyway not sure most customers wouldn’t ever buy at MRP rates).

One shop keeper confessed to me, “what to do sir, if I don’t display discounts no one will come into my shop. So I have to play the game of the trade”. Another one told me “ I use this as a tactic to draw the customers into my territory (shop)”. Its quite true. Many a time especially in the Global Brands you will find that after you enter the shop the number of items on sale with discounts will hardly be a few when compared to the others.

Its time the gullible Indian customers realized that nothing ever comes free. All these discounts are actually been funded by the gullible customers in one way or the other. Its time that we come out of the rut and the trap and allow market to restore its sense of balance. Its time also that we had some regulatory body or the Consumer Court must take suo moto action and put an end to this Game of Discounts.

It’s a pity that many a genuine vendors are getting lost in this myriad of fakesters and compelled to adopt unethical practices to stay in the game. And customers on their part will not shop without any discounts.

When will this farce end…. Or will it not end at all… only time will tell. Afterall – you reap only what you sow !