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Unit 3 P2

In: Business and Management

Submitted By Fajar01
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Describe limitations and constraints under which marketing
Report by: Fajar Hassan
To: marketing director of Apple

This report is to advise you on what legal requirements you have to follow in order to maintain a successful and legal business. Therefore following all these laws and changes is mandatory and must be understood thoroughly. Sales of goods act 1979

This act requires traders to sell their goods as they are described and of satisfactory quality. Also it should serve its purpose and be of use as well as being able to back any claims of it not functioning or not serving its purpose. The product should be of satisfactory quality which means that that the product must last a reasonable time. Nevertheless this does not give the customer a right if the product was obviously faulty and they still purchased it. If you purchase and item which does not meet the description of purpose you have a right to return it within the given days, get a replacement or exchange for another item. If your goods fail to meet any of the above criteria then you could have a claim under the Sale of Goods Act.

E.g. if you buy a printer from John Lewis which is meant to connect with your computer but it does not you have a right to return it and they will happily recommend a better version to buy.

Consumer protection from unfair trading regulations 2008

This act entitles all customers honest and fair treatment from the businesses they deal with. With this act businesses cannot use aggressive sales tactics to gain sales. Companies cannot use misleading underhand tactics to get sales. Misleading actions include goods that have never existed or offering a small amount of the advertised item with no hope of meeting a large demand. Furthermore you cannot sell a product by passing it off as another product in order to gain sales. Lastly they cannot advertise dishonest promotions such as closing down sales when the business is not actually closing down. If you fail to follow this code you could be a breach of the customer protection from unfair trading regulations.

E.g. Sports Direct always have closing down sales but till this day they have never closed down therefore this is misleading information and is a tactical way to gain sales.

Consumer credits act 1974 and 2006

This act regulates consumer credit and covers the following areas:
Content and form of credit agreements
Method of calculating annual percentage rate (APR)
Procedures relating to events of default, termination or early settlement#
Credit advertising

Before granting credit or increasing the amount of credit, the creditor must assess your creditworthiness in order for you to be illegible.

You must also give key financial information including:
The amount of credit or the credit limit
The duration of the agreement
The APR
The total amount payable
The amounts and timings of payments

This information must be contained in a document headed ‘pre contract information’ which must be provided separately to the credit agreement itself. Both parties must sign an agreement and a copy of the agreement must be given to the customer either at the date of approval or seven days thereafter.

This act requires business which provide credit or loans to give regular updates to their customer of their account (monthly or annual statement). If a customer falls behind on payments the business must notify them as well as extending the time to repay the money. This helps to prevent predatory lending where a business immediately involves bailiffs or uses threatening tactics when a customer struggles with repayments.

E.g. If you take a credit card with Dorothy Perkins they must notify you when each monthly payment is due as well as sending a statement to know how much a customer has spent on the card.

Consumer protection regulations

This regulation requires business to provide clear information to their customers so that they can make clear informed decisions. This is because this is not face to face selling this is usually on an e –commerce website or mail order catalogue. They must give their customers information about the goods or service they are selling, payment arrangements, and delivery arrangements and consumers rights to cancel orders where necessary. This allows the customer to fully trust the company as well doing business with them properly.

This set information must be given by the seller about the goods or services on offer:
Description of the goods or service
The price of the goods or service
Delivery and cancellation rights
Information about the seller
If the seller wants to send substitute goods because they don’t have the goods a customer wants they should address this before the order is placed. Also the cost of returning substitute items should be at the seller’s expense.

The distance selling goods say that goods must be delivered within the time frame agreed with the seller, if no time frame is agreed thirty days from the day after they received the order is given.

E.g. Boohoo.com is a web based clothing business so it is their right to give clear information on sizes, prices, delivery and returns in order to remain in business.

Data protection act

This law allows individuals to have access to their personal stored information. Personal information is usually held when a customer makes a purchase from a company. It consists of bank details or any other necessary details needed for the purchase. If a company has incorrect information a customer should request to change it by either personally contacting them or using an online form to make these changes.

Every customer has a right to question what their information is being used for especially if it is causing unnecessary damage or distress. If a customer has contacted a company the organisation has twenty one days to respond to this request. This information is very important and it could fall into the wrong hands and be misused which breaches the law of the act.

It is the company’s responsibility to make sure any processed information is:
Relevant
Processed fairly and lawfully
Obtained for one or more lawful purpose and should not be used in any way incompatible with that purpose.
Accurate and up to date
In accordance to this act
Not kept longer than necessary
Secure and only available to those who are authorised, special measures shall bet taken towards those who are unauthorised or using it unlawfully.
Should not be transferred to other countries without proper protection.

E.g. John Lewis they must ensure every customer’s information is protected and should not be given or be accessed by unauthorised personnel. If this does happen they are in breach of the act.

Codes of advertising practise and advertising authority

Every company must follow these regulations as they have a right to advertise truthfully and not mislead customers into false business deals. Also they cannot advertise products such as alcohol or cigarettes as they are prohibited. Also by law advertising cigarettes, alcohol and drugs are prohibited and cannot be advertised in any promotional way. Also as these are prohibited they cannot be advertised as an advantage to the customers which could persuade them to purchase it.

E.g. If Stella Artois advertise their beer and say it will benefit your lifestyle this is in breach of the act as consumption of too much alcohol is dangerous for the health.

Pressure groups and consumerism

Pressure groups are groups of people who share same interests in a business or a product, these groups can persuade or force businesses to make changes to their products or services. Many owners believe that acting ethically increases costs and so reduces profits. For example, a business can cut costs by hiring child labour at very low wages in developing countries. Paying below average wages lowers the firm's total costs. These pressure groups can persuade a business to change its products, its suppliers and the materials a business uses. Pressure groups persuade or force business by generating publicity and lobbying politicians.

E.g. Fair-trade have developed an ethical brand image which pressure groups promote, therefore their products prices compensate for higher wages given to workers.

Consumerism

Consumerism is increasing the consumption of goods which are not necessarily needed. America is a well know consumerist and materialistic countries In the world. Often consumerism implies waste, decadence and luxury, it is also said that consumerism brings bliss to the society and keeps people content. Som episode feel the need to over spend to fit in and be 'on trend'.

E.g. Buying new season class he's as they are off the runway for no apparent reason when cheaper and affordable is available I.e. A Dolce Gabbana dress would cost £1650 a very similar high street dress could cost £20-£75. This is excessive spending such as spending £2790 on a Givenchy handbag which is totally useless a similar bag could be found in high end high streets shops such as Zara for £39.

Acceptable language

When advertising or selling products no company should discriminate against gender, sexual orientation, religion, race, disability or ethnicity as these are incorrect terms of identifying people. They must keep their advertising neutral and non-offensive against people as-well as competitive companies. They cannot publicly criticise or fault other coma ones products as this is wrong. Using proper and clean language is a must as many ages will be watching or seeing their products or adverts so no foul language should be used. Slang can be used if it is to attract different audiences in a humorous way not to offend or discriminate against certain types of people. E.g. Tesco cannot use swear words or street terms when advertising groceries on television as this is completely wrong and against the terms of advertising and could offend many people.

Bibliography

www.tutors2u.com www.investopedia.com www.businessdictionary.com www.which.com www.ASA.com www.bbc.co.uk http://www.bbc.co.uk/bitesize/higher/business_management/…...

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