A retailer engages in deceptive pricing when they utilise a price gimmick to make customers believe they are receiving a discount when they are not. A going-out-of-business sale or a bankruptcy sale when the company is not closing are examples of deceptive pricing.
Other types of deceptive pricing include clearance and discount sales that claim to offer the lowest price. An example would be a shop paying $50 for an item at cost. Typically, a product is marked up by 50 percent before to being offered to the general public. If the item is marked up by 100 percent for a few days, followed by a sale promoting a 25 percent discount, the retailer is deceiving shoppers into believing they are receiving a bargain. Increasing an item’s initial price before decreasing it and presenting it as a sale item may violate laws prohibiting misleading business practises. Consumers are protected by law against deceptive corporate pricing. When business owners make false or deceptive comments about price reductions, they break civil codes. Suspected deceptive pricing can be reported to the attorney general or the local office of legal aid, thus it is advantageous for customers to compare prices and be aware of the average cost of products.