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divamum_gw

Shady Lowes accounting practice (semi-ot)

divamum
16 years ago

Ok, hear me out. I want to pursue this not because it's such a huge financial big deal, but because it really REALLY ticks me off that the big box stores pull this kind of crap - it's just this side of bait and switch.

So, yesterday I purchased (rounding up the numbers to make it a little easier to explain!)

1. Faucet (the backup plan before Ikea came through and fixed the existing one) for $218

2. New coffee pot for $50

I used a $10 off coupon (not PERCENT, but actual dollars).

Since I didn't need the faucet, I returned it today. Here's where it gets really dirty, IMO.

To me, it should have been

(218+50)-10=subtotal

The way THEY did it was

(218-9=$209)+(50-2=48)=subtotal

(and how do they decide how much to deduct from each item? Clearly there's some undisclosed %age formula for this, but it remains the fact that it is not disclosed and the customer is not "in" on this, and thus is at the whim of the store's accountant/programmer)

So when I returned the faucet, I was refunded exactly what the computer calculated its price was AFTER the coupon discount had been computed (even though that discount was an undisclosed percentage rather than taken off the total).

This means that, in effect, by buying two items together and returning the higher-priced item, I only got $2 worth of my $10 coupon. If I had bought the coffeepot SEPARATELY, I would have had the full $10 benefit.

This strikes me as a really, really dirty and ugly little accounting wheeze. The managers at the store seemed to be having difficulty understanding my complaint since "the computer refunded what you paid", and although they were nice about it, they just didn't seem to see why I was outraged. I want to pursue it at a corporate level, just because I think it's WRONG, and basically is a nickel-and-dime way of screwing the customer.

Any thoughts on how to proceed? If my explanation isn't clear (I'm not good with explaining numbers) let me know and I"ll try to express it more clearly.

Comments (34)

  • teedup1
    16 years ago

    Yep, your total charge should be only $40 when all said and done. This must be "new" math Lowes is using. Pursue! I would.

  • lightlystarched
    16 years ago

    Thats just wrong. I would take both items back and shop elsewhere. Next time you have a coupon, make sure to only buy ONE item with it. Ring up the purchases separately if you have to.

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  • Buehl
    16 years ago

    Is there any way to return the coffee pot as well and get your $10 coupon back? Or, do you have another $10 coupon?

    If yes to either, I'd return everything, and then turn around and re-purchase the coffee pot w/the $10 coupon.

    The only time that I think what they did would be valid is if there were a minimum purchase required to use the coupon.

    I'd even do it right in front of them...sort of a "so there!" attitude!

    As to contacting Lowes corporate, write a letter and maybe follow up by a telephone call. I don't think you'll get anywhere on the phone, though. Most of the people answering the phones are minimum wage or part-time grunts that have no authority and don't particularly want to deal with you anyway. Sorry for the negative attitude, but I've attempted to deal with so many of these types lately that I've become very cynical (and grumpy) about it! [I start out on the phone bright and chipper w/high expectations but generally end up frustrated at the inability of so many of these people to either understand English in general OR understand why I care about what they think is a "little thing" OR have no idea about the products they're supposedly answering questions for!]

    Don't send an email since those are ignored and/or deleted (or you get an auto responder that says "Thank you, blah blah blah").

    Also, sometimes the squeaky wheel gets the grease...i.e., if you persist they may give you what you want just to get rid of you!

  • divamum
    Original Author
    16 years ago

    Well, they actually gave me a manager's card with a handwritten "give her a discount next time" deal on it, so I've been satisfied for my own trouble, but it bothers me that this is allowed to happen. Just THINK about how much money that practice adds up to over the large scale a store like Lowes covers! So many people wouldn't even notice it because "the receipt said it was $XX" and would just let it go.

    It's the sheer parsimonious nastiness of it that bothers me and has prompted a spell of my legendary righteous indignation ;) Part of me can't be bothered with the hassle of fighting it out since my personal investment in it has been addressed, but if it's still bothering me in a few days I think I will puruse it just because it's so bloody WRONG. Grrrr.

  • mayland
    16 years ago

    Based on my experiences, you will struggle to find anyone there who will actually look at the maths rather than the computer.

    I bought some tiles from Expo advertised at $7/sf. I paid in a rush (screaming kids, etc), and did not realise until I got home that I had paid closer to $10/sf. I called to complain repeatedly and was informed that the higher price was (per sq ft) for the 18x18" tiles I had bought, and that the advertised, lower price was only for 12x12" tiles (per sq ft). When i complained that the bigger tiles should not be more expensive, I was told (repeatedly, by different managers), that "you get more in each bigger tile, so of course they are more expensive". PER SQ FT....!! aaargh. I tried repeatedly and failed to get them to understand the logical flaw in this, and finally I gave up as it all became rather nasty.

    The silver lining was that Expo screwed up my order (as usual) and sent me a $15/sf tile (that i preferred but had not been able to afford) instead of the $7/sf tile I thought i had ordered in the first place.

    We have experienced several errors from HD and Lowes that have ended up saving us $. And unfortunately, many that have cost us time/frustration/lots of phone calls to resolve. I view it that the "surprise" discounts make up for the overall incompetence.

    My advice is to complain a couple of times (you may get a 10% off coupon at least), and then to wait for them to make one of their inevitable errors that actually save you some $. At the end of the day, they make so many mistakes that you will come out ahead.

  • weedyacres
    16 years ago

    I'm a defender of consumer rights and all, but I actually have to pop up in defense of Lowe's on this point. I don't believe that they're trying to screw you, I think you're the unintended victim of a discount policy intended to keep people from slipping one over on Lowe's.

    Bear with me here: That coupon, if I recall (I used one a month or two ago) was for $10 off a $50 or more purchase. Let's say that someone less scrupulous than you bought 5 $10 widgets and they rang them up as 5 $10 purchases, then subtracted $10 at the bottom of the receipt. Then this scalawag returned 4 of the 5 items, and because they showed up as 4 $10 charges on the receipt, pocketed the original cash outlay and got a free widget out of it.

    To prevent this, Lowe's allocates the markdown across the items, so that each item shows up as $8. That way, if the person returns 4 of them, they get $32 back, and still paid $8 for the one they kept. This is actually slightly generous of Lowe's, because they allow a discount even when the person spent less than $50 after returns. The "secret formula" isn't so secret: amt of coupon divided by total purchase price = % discount, which is applied to each item.

    This is similar to how big blue and big orange do percent discounts. If you have a 10% off coupon, the receipt will adjust each line item by 10% so that if you return anything you only get refunded the discounted amount that you actually paid.

    So while I agree with you that if you do a partial return you deserve to have the coupon apply fully (if you've fulfilled the terms of the coupon, like a spending minimum), I don't think they set up this super-secret policy just to try to take advantage of you. And since the people at the store didn't set the policy, it doesn't surprise me that it confused them as well.

    And mayland, larger tiles generally DO cost more per square foot than smaller tiles. It's not because they're bigger as your Expo friends were claiming, and I don't know exactly why (higher manufacturing costs for big tiles?), but, whether it seems logical or not, I've seen that with many lines of tile.

  • kimwok
    16 years ago

    Hi Divamum, I hate to tell you this but it is not only happening at Lowes. I have had this happen to me several times at the Gap and at Gymboree. Every time I tried to explain the unfairness of it and all I ever get is dumb looks. I can understand it if the minimum amount is not spent (like if you must spend $50 to get the $10 off) but when you have spent more than the minimum you should still get the $10 off if only 1 item is returned. I had a problem one time at the Gap--they wouldn't even let me exchange the same item for one in a different color without upcharging me $14. They couldn't understand my outrage. Sometimes you are better off saying you lost the receipt especially at places like Lowes where they don't really have sale prices. You will probably get a store credit but at least it would be for the full amount.

  • lmarletto
    16 years ago

    Re: larger tiles costing more per square foot - I've looked at a few tiles where both larger and smaller sizes were more per square foot than the 12"x12" tiles. The salesperson at the small tile shop said it was because those lines sell about 10 times as many 12"x12" as any of the other sizes. The manufacturing costs for the 12"x12" are lower just due to the economies of scale.

    I bet weedyacres is right about why Lowes discount makes no sense to an honest person.

  • mayland
    16 years ago

    thanks for the explanation on the tile sizes, makes sense. i wish the managers at Expo had known that, they would have saved themselves having me try to explain how a sq ft is always a sq ft, ad nauseum!

    Sorry to hijack your thread, divamum. Good luck if you decide to pursue it with Lowes, you will need a lot of patience!

  • vizslalover
    16 years ago

    I agree with weedyacres that Lowes is doing what they need to do to be able to offer these kinds of coupons without losing THEIR hides.

    I frequent a couple of 'deal' forums. Frankly, I find some of the 'deals' people post there little more than theft and certainly fraud. The kinds of deals I'm referring to often involve coupons like the one you had and returning items (and often price matching). I am NOT saying you were trying to pull anything funny on Lowes because you certainly weren't. However, there are a surprising number of people out there who will and do (and then post explicit instructions online for how to do so so others can get a good 'deal' too) and they need to be able to protect themselves as a company.

    As others have mentioned, return policies surrounding discounts like this aren't especially uncommon either.

  • divamum
    Original Author
    16 years ago

    But yanno... just because "everybody's doing it" doesn't make it right :)

    I guess my feeling is that a multi-million corporation like that is more able to absorb the occasional "whoops" than the average individual, and I suspect that it goes in the stores' favour more often than it does the customers! The business model for so many of these large corporations is devised so that the Computer Is King in the store, presumably so the employees can't cream anythign off the top and all sorts of other 'protections" to the monolith, but I also find that it dumbs it down so much that common sense flies out the window and things are never assessed on a case-by-case basis.

    That said, I find it hard to believe that the computer can't generate some kind of algorithm/formula to be able to protect BOTH sides of this particular issues ... I wish I were a math and/or computer guru so I could figure out what the dickens it was!

    As I said, in my personal case, I have been offered compensation, so this isn't really a case I'm fighting for myself - I just think it's a very skewed practice where the Big Bully flexes muscles and leaves everybody else to try and figure out another route to avoid the "problem". It just bothers me :)

  • minnt
    16 years ago

    I just spent $700 at Lowe's and received a $10 off for spending $50 coupon. I asked her why I didn't get fourteen $10 off coupons for spending $700. She didn't know, but then I said I should have had her ring it all up in $50 amounts, then get a coupon for each transaction. I could use the first $10 coupon on the next transaction, and keep going until I had paid for all my stuff, using a coupon for each transaction. I guess the way to shop at Lowe's is to not spend more than $50 at a time and to only buy one thing at a time when using one of the coupons.

  • fandlil
    16 years ago

    I know exactly how you feel. You were cheated. Another approach you might consider taking, although it will cost you a modest amount of money, is to go to angieslist.com and report this situation to them. I don't know if the big box stores pay attention to complaints about them aired on such Internet sites. They might. Once you've signed up on angieslist.com, you can benefit from info posted by other members. (I cannot say how beneficial it is, since I do not belong. But at least you'll have the satisfaction of making their shady practices public.)

  • amtaustin
    16 years ago

    I don't see what the big deal is. I went through the very same thing today at Lowes.

    Also, is there any expectation that -every- $50 you spend gets you a $10 coupon?

    Let me try to show this in another perspective: If you went to the grocery store and bought milk with a $1 coupon, ended up spending $2 (instead of $3) and then returned the milk would you expect $3 back?!?!

    All Lowes is doing is spreading out a coupon (not to be confused with a gift card/certificate) among the items you bought.

  • divamum
    Original Author
    16 years ago

    amtaustin: your scenario would be correct IF I had only bought the one item (milk), which I then subsequently returned. Absolutely - the amount paid would be the amount credited back.

    BUT.... that was not the case in my example. In addition to the "milk", I had also bought "cheese". The coupon was allegedly a discount on the total cost of milk AND cheese, not individual items. Until it came time to reverse the process. Thus the bulk of the value of the discount remained with the vendor since it had actually been prorated and applied to the individual items. Lowes came out $8 to the good, in my case, since only $2 of my discount was ultimately applied to the portion of the purchase - the coffeepot - which I kept. If I had bought that exact same coffeepot in a separate, individual transaction, the entire $10 discount would have applied to it. I see no reason why the return should actually change that and prorate the value of the coupon.

    In any case, not to beat a dead horse, I just didn't want it to be misunderstood - I'm not trying to "work the system", I'm just somewhat offended that the system seems to be trying to work US!

  • plllog
    16 years ago

    Divamum, unlike the help at Lowe's I can do math and write a program :) If Lowe's had your receipt on file, the way Bloomingdale's does, it would be easy. Without that there's no way the register can know what you bought. What the cashier should have done is returned the coffee pot from the receipt, then resold it to you with the coupon. If the coupon is expired, the correct thing is to call over a manager, who can either do an override and adjust the amount or give you a replacement discount, which is what happened. But big stores and Disneyworld are mostly interested in pushing people through quickly :)

    Do keep us posted if you get a response from corporate! No matter what the issue, they should be nice to the customers and care about their concerns!

    BTW, regarding tile, as Lmarletto said, there's economy of scale. After that, as my tile guy explained it, usually larger ceramic tiles cost more because it's harder to make a larger, flawless, piece that doesn't break. Whereas larger stone tiles are usually less expensive because there are fewer cuts, which also can mean less breakage.

  • remodelqueen
    16 years ago

    My husband is right- they should change their name to "Blowe's".

  • redbazel
    16 years ago

    Diva, it's a bummer that you weren't able to apply the full value of the $10 coupon to the coffeepot you DID keep, but I don't think you were taken.
    Here's the way I would explain what happened. Let's just say that since this happened to you, you decide next time to apply your $10 coupon to one purchase only so you will get to use it in full. So, you take your $10 coupon and buy the faucet. Great! You now have a $218.00 faucet for just $208. Then, you buy the $50 coffeepot. Later, you find that the faucet doesn't work out for you and you go to Lowes to return it. They refund you the entire $208 you spent. You go home to your $50 coffeepot. You sit down with a cup of coffee and a scone and wish that you had had the foresight to use your coupon on the coffeepot instead of the faucet, because, now your coupon is on it's way to the junkyard for used coupons and you ended up paying full price for the coffeepot.
    See what I'm getting at? Sometimes, the cool coupons that manufacturers and businesses provide as incentive to shop, don't really benefit us...........just because of the way things work out. At least you got to use $2 worth of yours.

    Red

  • redbazel
    16 years ago

    Just because I was still thinking about this tonight, I did a blind test (put the scenario in front of them, as in, "Let's say you went into Lowes with a $10 off coupon and bought a faucet for $218 and a coffeepot for $50...") with my 20 year old daughter, my DH, and a friend. I made sure I kept it neutral so they wouldn't have any idea what I thought, and then asked, "What do you think? Don't you think Lowes would be cheating the consumer?" Interestingly enough, all three stood firm that the consumer would not be cheated with this scenario. My daughter even commented that no one is 'entitled' to a coupon. Lowes doesn't 'owe' it to their customers. It's simply a plus when you go in to shop. DH had his own take on the matter, but still sided with the store's figuring, commenting that the consumer should be happy with the portion of the coupon they still got to use. And my friend went even further. She said that if a person went in and even bought just one item, using their coupon as a discount--came home and realized that they couldn't use the item purchased after all, that person would certainly Not expect the store to retrieve their coupon out of a drawer for them to try again. The coupon was used in good faith on a purchase that was made in good faith, but once the consumer decided they didn't need the item, the discount is gone too.
    Maybe we're just wired that way, along with Amtaustin, Vislalover, and Weedyacres, but my house didn't see any intent to cheat, either on your part or on the store's.

    Red

  • david_cary
    16 years ago

    I'm with Lowes on this or at least not mad at them over it. They spread out coupons by basing it on cost of item. It is annoying for just your situation but they had to do it to prevent abuse. It probably helps their accounting to spread discounts over all items in a purchase. That way they can see that their average selling price for the faucet was $214 as a certain percentage of buyers used a coupon. Then they can look at their cost of the faucet and make sure that they are making an acceptable overhead. It maybe that when people buy faucets, they use coupons a lot since it is a relatively expensive item (and its timing can be planned since it is usually a style upgrade rather than a repair).

    Lowes is so "generous" with their 10% off coupons and their current promotion ($10 off coupon with a purchase over $50) that you could easily "make up" the money on a future purchase. I for one and going to go into Lowes a few times this weekend and make some $55-$60 purchases on things that I will be needing. A $10 off coupon on $50 is the equivalent of getting 20% off. And here is a tip - you can buy $60 worth of stuff, use a 10% off coupon, and pay $54. Then you get a $10 coupon. Go back to Lowes, buy $60 worth of stuff and use your coupon and get another one. Yes you can get a coupon while using a coupon. Of course the last coupon should be used for a near $10 purchase on a single item that you know you won't return....

  • weissman
    16 years ago

    I can see both sides on this issue. One way to solve the problem is for a store to simply not allow returns on any item purchased with a discount coupon just like they do on special orders.

    Actually I'm amazed at the liberal return policies of many stores. People seem to just buy stuff they don't really need or want and then return it a few days later. I have a friend with a car full of stuff she's going to return.

  • paul_ma
    16 years ago

    I'm not in agreement with Lowes on this, but I can speculate why they might be doing it this way.

    I suspect that their records don't include the terms and conditions of the coupons used. By allocating the value of the coupon over the purchased items they provide some breadcrumbs for processing a return in the future.

    Otherwise, if they had just recorded a $10 discount off the total, when you made the return they wouldn't know how to apply it against the remainder of the purchase. (It might have been $10 off a purchase of $250 or more, in which case you would no longer be entitled to the discount.)

    Of course they could also solve this by barcoding the coupon with info that allows them to look up the terms and conditions.

  • glennsfc
    16 years ago

    Somewhat off-topic.

    Liberal return policies can be amazing. Years ago some fellow attempted to return a wrecked carbide tipped circular saw blade to Sears, because the tips were worn off. He had attempted to cut concrete with the thing and admitted it. The store manager told the sales clerk to give the customer a new blade.

    Because of this example and many others since...I wonder how Sears makes any money. Is Sears really a front for some other kind of business, or is their financial business the 'real' business?

  • weissman
    16 years ago

    A number of stores - I can think of Costco and LL Bean - used to allow returns at any times - people would wear clothing for years and then take it back to exchange it - or buy a TV to watch the Superbowl and then return the TV. What started out as good customer service ended up becoming a target for scammers.

    On the other end of the spectrum some stores have started banning customers who return too many things. A few years ago there was a story on the news here in Boston that Filene's had banned a couple of women from shopping there because they had returned too many items. They hadn't committed any crimes or fraud but Filene's just didn't want them as customers anymore. Apparently as long as they weren't descriminating based on race, religion, etc. the store was free to not sell to people they didn't want to deal with.

  • sue_ct
    16 years ago

    On the other hand, around here I am hearing about more stores with increasingly liberal policies coming to our area. One is LL Bean, another is Coldwater Creek. A women manager at Coldwater Creek yesterday told me "you can return an item 17 years later if you want and you can tell anyone I told you could." The sales model is cultivates trust and gets the dollars of the people who are willing to pay a fair price for high quality items. Neither store is "cheap", but they want you to know the items you buy there are good quality and will last. There is definitely a market for that type of thing. From the crowds at LL Bean, they are not hurting for business despite the money crunch from oil prices and decreasing home values, and people are still willing to pay a little more to shop there. They have been around long to for me to assume it is working for them.

    Sue

  • creekylis
    16 years ago

    Sorry if this is slightly OT... but I think the difference between what a place like Lowe's can do with regard to returns and a place like LL Bean has everything to do with MARK UP. LL Bean probably makes an average of 65-85% profit on each item sold. At that rate, they can take a few items back and throw them in the trash and still come out way ahead. In fact, it is my personal theory that when a store has say 10 sweaters, the first 3 sold at regular price probably pay for the lot, allowing for the clearance sales, etc, with the remaining ones. Lowe's or HD probably makes more like 20-35% profit. At the end of the day, that's a huge difference to pay the bills with. I'm also guessing that it costs more to run a huge store like a Lowe's with all the employees and the utilities, rent, etc. A clothing store has a lot less of that too.

    This is JMHO... but as I have said before... Big companies (like all of the above) have specific consumer affairs departments whose only job is to make you happy and to pester the store and district managers until it is deemed so. I have many years in retail management and feel very confident in saying that if you call the right people -- AND REMAIN CIVIL (remember, the person you are talking to isn't the one that harmed you) -- you will be taken care of fairly.

  • paul_ma
    16 years ago

    creekylis,

    There is no doubt some truth in what you say. But IMO it isn't the story in all places. There really are places who seem to have a policy of screwing the customer. Best Buy is one of those places. I'm not sure about HD or Lowes.

  • fnzzy
    16 years ago

    this was done to me last week at Macy's too - coupon for $10 off split among the items I bought. Now, some of the items were "iffy" items that I was thinking about returning anyway, you know, ones you had to try on at home to decide, so I made the girl re-ring it to keep the coupon ONLY on the one or two items I knew I'd 100% be keeping.

    And who ever said lowes is generous - HA - usually on holiday's they offer a 10% discount to military. One one time, when my husband was deployed in IRAQ I went in to buy flowers (must have been memorial day or 4th of july) anyway, the girl looks at me, looks at my military ID and says "well you certainly don't look like your in the military" in the most snooty tone. The discount was for families of military - anyone with a valid military id, so I was not trying to pull one over, I was simply trying to use a valid discount that they promoted. I had to explain their own policy to her. I was pretty much done with lowes after that. Each other time they have had military discount days I've heard from other military families about being given hassels.

  • vegas_t
    16 years ago

    Lowes is not the only store to spread coupons across the whole purchase. Nearly every place that I shop is doing the same exact thing. Be it Gap, Reebok, Best Buy etc...

  • malhgold
    16 years ago

    I've had this annoying experience happen to me at the Gap as well. Within the past few weeks, I received a letter from them(I'm a GAP credit card holder) along with a $10 off coupon, saying, in essence, that they've "realized" that their actions are "not in keeping with quality customer service" and going forward if you have used a coupon and need to return the item, they will credit your GAP card not only for the returned item but also the portion of the coupon that had been applied to that item. This would solve any of these sorts of issues. Prior ti this change in policy, I have had sales associates ask me if I was certain to be keeping any of the items because they would apply the entire discount to that one item and then ring up the remaining items in a separate transaction.

  • sue_ct
    16 years ago

    I guess if you feel this unfair, now that you are aware of it, you can change your purchase habits to account for it. Buy the minimum required to fullfill the terms of the coupon with the item or items you believe you are least likely to return. Then ask them to ring up the rest separately or make the purchases at different times. Think before you use the coupon, if I only have one chance to use this, what do I use it on, and buy accordingly.

    Sue

  • bignich
    16 years ago

    You got a discount on the faucet. Then you decided to return the faucet and think you have been treated unfairly because they will not refund more than you paid for it.

    Large corporations pay their savy marketing people lots of money to devise methods of making things seem as they are not. You have fallen victim to one of their schemes. In the future think before you act. Realize that most everything any merchant does is with their own best interest at heart. They are trying to trick and decieve you in virtually every transaction you are involved in.

    It used to be that the customer was always right. Not anymore, the stockholder is at the top of the food chain, under the CEO of course, the customer is somewhere near the bottom rung.

    BTW, I got a $10 coupon also, bought some stuff for $12, had to pay $2. Ended up not needing any of it, so I returned it all and threw the receipt away on the way to the store. I had to settle for a $12 gift card that I used a few minutes later. Good luck in the future.

  • scottbeth
    16 years ago

    I certainly understand the OP's situation and am not siding with the big box stores, but if the original math is what actually occurred, then it seems that the original price ($218+$50)-$10 = $248 (is this correct?)
    Returned faucet ($218-$9) = $209 (was this the refunded amount?)
    Total net cost of teapot ($248-$209) = $39 (???)

    I guess the OP did not state what exactly was the amount of her refund, so my math is, no doubt, off.

  • creekylis
    16 years ago

    scottbeth... not siding either, but...

    $218+$50-$10 = $258

    $258-$209 = $49

    just a slight error in the first calculation.