3 comments

1. Anonymous on 7/1/08, 9:01 AM

   Be ever grateful that you avoided a big scam. Here are some things you and your readers should know:
   
   DirectBuy’s sales contract says:
   
   "IMPORTANT MERCHANDISE TERMS:
   - The Club disclaims all warranties regarding the merchandise
   - Any need for subsequent repairs or service, after receipt of merchandise, is members? own responsibility.
   - MERCHANDISE MAY NOT BE RETURNED.
   - The entire merchandise price plus handling fee, estimated freight and sales tax is required as a down payment at the time of placing an order with the Club.
   - Suppliers reserve the right to change their prices without notice.
   - From time to time some suppliers and services are dropped and others are added
   - Only the supplier has the right to cancel an order."
   
   http://edumacation.com/DirectBuyMembershipAgreement
   
   Here's what the Consumer Watchdog in Hartford, CT found:
   
   "If you don’t like the product, tough. You are stuck with it. DirectBuy unlike retail stores has a no-return policy and provides no warranties.
   
   Sales books are not always up to date, and not every item is always available.
   
   More disturbing to me is that DirectBuy attempts to hide the fact that not all savings it sees from manufacturers are passed on directly to members.
   
   By reviewing the 260-plus page agreement with its franchise owners, I learned that DirectBuy reserves the right to keep rebates, discounts and other payments from manufacturers and suppliers.
   
   It also keeps early-pay discounts, and all DirectBuy purchases are paid by the member at the time of ordering."
   
   http://www.courant.com/business/hc-watchdog0511.artmay11,0,3450527.column
   
   
   You guessed it: It's a scam!

    
2. Jon the legal immigrant on 7/1/08, 10:01 AM

   Thanks for the comment!
   
   I found online that their annual membership fee is something like $5,000.
   
   It does make sense that if they sell at cost, that the rebates would actually cost them as a retailer. I'm a reseller of some online services, and when a discount coupon was used through my own reseller account, it was taken from me, because it's usually deducted from the mark up.
   
   I'm more concerned with the no-return policy, no warranties, and that the supplier can cancel any order.

    
3. Anonymous on 9/7/08, 10:53 PM

   DirectBuy Sued!
   
   A federal lawsuit has been filed in U.S. District Court in Hartford against the national high-end DirectBuy franchise operation, accusing it of falsely telling prospective clients that they are getting furniture, appliances and other household products at manufacturer prices. In a lawsuit filed by attorney Seth R. Klein of Hartford, DirectBuy is accused of hiding the fact that DirectBuy receives rebates from manufacturers which are not directly passed on to their members, who pay as much as $7,000 to join for two or three years. The lawsuit, which seeks to be certified as a class action representing thousands of present and former members of the more than 100 franchises, was filed earlier this month. It follows a column on DirectBuy that disclosed the rebates, which are kept secret from its members and from those it entices to join through high pressure sales techniques.
   
   DirectBuy officials had no comment on the suit but had said earlier that it uses the millions of dollars it received in rebates to the benefit of its members.
   
   We will see what a jury has to say about that.