Consumer Protection in Direct Sales and Marketing

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What is Direct Sales?

Direct Sales are sales made by marketing and selling of products directly to the consumer, not through a store. Sales occur at home, work or other non-store location. This system often eliminates several of the middlemen involved in product distribution, such as the regional distribution center and wholesaler. Instead, products go from manufacturer to the direct sales company, to the distributor or rep, and to the consumer.

 

What is Direct Marketing?

Direct Marketing is a form of advertising where organizations communicate directly to prospective customers through telemarketing, email marketing, websites, online adverts, direct mail, fliers and catalog distribution, promotional letters and targeted television, as well as newspaper and magazine advertisements.

 

What are the disadvantages of impulse buying of goods through direct sales and marketing?

The consumer protection by the provisions of the Consumer Protection Act is not sufficient in the particular case of direct sales and direct marketing business, where an independent distributor or a direct sale agent offers the direct distribution of goods and services to the consumers with a strategy for introducing goods to stimulate the consumers’ demand.

Upon consumer’s decision to purchase, a contract of sale will establish obligations which might have negative consequences for the consumer.

When the selling is done through the media, the consumers neither touch nor have a clear look at the goods. As a consequence, the consumer may receive goods, which are of different quality than in the advertisement. And after the return of goods, the consumer might receive nothing back, or a refund might be very slow.

 

What are the rights and duties of a direct sales and marketing consumer in Thailand?

The issuance of the Direct Selling and Direct Marketing Act is for the purpose of taking legal measures for controlling the direct selling and direct marketing business and for the protection of the consumers.

Rights of the Consumers
  1. In buying of goods or services, the consumer must receive the document or receipt with understandable Thai language statement. It must contain the following particulars:
  • Name of the buyer and the seller;
  • Date of buying and date of delivery;
  • Scheduled time, place and method of payment of debt;
  • Method for termination of the contract;
  • Method for returning of goods;
  • Warranty on goods;
  • Replacement of goods in case of its defect.
  1. If the consumer is not satisfied with the goods bought from the independent distributor, the consumer can send written notice of his or her intention to terminate the contract to the business entity within 7 days from the date of receipt of goods or services. However, this may not apply to all types of goods or services. This may depend on the categories, prices or types of goods and services;
  2. Where a consumer exercises his or her right to terminate the contract, a business entity shall refund the total sum of payment by the consumer within the period of 15 days from the date of receipt of the notice of intention to terminate the contract;
  3. A warranty on goods or service shall be in Thai language. It shall clearly indicate the rights of a consumer to claim his rights pursuant to the warranty.
Duties of the Consumers
  1. A consumer terminating the contract shall return the goods to a business entity or appropriately keep the goods for the return;
  2. In case of damages, lost or impossible to return due to consumer’s fault, the consumer shall pay damages to the business entity. This is except for damages normally arising, for the purpose of using the goods or services;
Which Government Agency has the duties to protect consumer rights?

The Office of the Consumer Protection Board is an agency which has duties to protect consumer rights, promoting fairness and against being exploited as a result of buying goods and services from business entities, together with promoting consumer awareness in buying goods and services and supporting and strengthening coordination among consumer groups and networks.

 

What happens if the Direct Sales Business Entity fails to comply with the Contract?

If an independent distributor of any direct sale company has sold a certain amount of goods and he or she demands for monetary consideration, discount, commission, or the return of goods according to the rights indicated in the contract, the company must therefore accept the goods and pay back money with the value of the returned goods and monetary considerations as indicated in the contract.

 


 

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