How To Avoid Fraudulent Wholesalers
The following articles were published in the March 2006 of the Wholesale Pages... UK Wholesalers & UK Dropshippers Directory newsletter, and are reprinted
here by permission [pers.comm.03.07.06, Mark Johnson]. These articles contain information specific to the U.K., but the principles apply
in Canada and the United States as well. We've provided the appropriate Canadian federal and provincial resources in the right-hand
column.
NOTE: The key links in the following article are intact,
but those illustrating problematic content are obviously out-of-date.
How to detect and avoid fraudulent companies and wholesalers
As we mentioned in our previous newsletter, recently there has
been an influx of fraudulent wholesalers and dubious bulk discount
stores on the net. In this newsletter we will concentrate on how
to detect such companies and what necessary checks you must carry
out before investing in any business venture. Additionally we
have also issued a warning against a company, which to a normal
visitor would seem to be a legitimate and an authentic business
but in fact is full of suspicion.
To detect whether the company you are dealing with is genuine or not, you must carry out these checks.
- A professionally designed with a good layout is not an indicator
that the business is genuine. A lot of wholesalers do not have
great looking sites but are registered and authentic businesses.
Never EVER get convinced by the design of the site.
- Ensure that the company accepts payments via credit/debit cards
and other online payment methods like paypal, nochex etc. If the
company ask you to wire (BACS) money directly
into their account then avoid trading with them as most definitely
they are scamming you.
- Try to talk to a representative of the company on the phone,
it is always nice to talk to someone and clear your doubts.
- Visit their contact page and look for their contact/postal
address. Try to determine whether it is a physical postal address
or just a mailbox. If it’s a mailbox, find out why the company
doesn’t have a proper postal address and where do they actually
trade from?
- Request to visit their warehouse or trading office, even if
you do not intend to do so. Any fraudulent company would be hesitant
to let you visit their premises.
- Visit the Companies House website (www.companieshouse.gov.uk)
and use their search index to determine whether the company is
registered with them or not. Sole traders do not have to register
and as result this would only serve as a secondary check but none
the less will definitely help to clear any doubts.
We hope these checks will help you to differentiate a scam company from legitimate wholesalers.
Warning – How we implemented these checks to reveal a scam
We would like to warn all our members against a company which
might seem to be selling products at great bargain prices, however
by paying close attention to details and visiting their website
you will discover that you might be taken in for a scam. We are
not directly accusing the company of setting up a scam but there
are too many discrepancies to neglect, and as a result we are
issuing this warning.
The company website address is: http://www.appliancesyouneed.co.uk/
(let's call this site 1)
They are selling home appliances like fridges, freezers, dish
washers, laptops, plasma screens, etc at 40% reduced prices as
compared to the market rate. Initially the prices, products and
website layout seem great and give the felling that it’s
a legitimate business with a long trading history. A normal visitor
can easily get convinced that this is the bargain he/she has been
looking for!
However here is the catch. If you look at the WHOIS details of
site 1, the first thing that
will strike you is that the website was only registered in January 2006, indicating that it has been
recently set-up. Additionally it has been registered by an individual
rather than a company:
Now lets visit another website and compare these two:
www.trade-appliances.co.uk
(let's call this site 2)
The first thing to notice is the similarity in design and the
range of products both of them are selling. On checking the prices
you can notice that the RRP prices on the Appliancesyouneed.co.uk
are exactly same as the prices on Tradeappliances.co.uk, however
the actual selling price of every item on site 1 has been greatly
reduced to lure and entice the visitors. Clearly all these points
are raising more and more suspicion against site 1 but lets overlook
everything for the time being and give site 1 the benefit of doubt.
Having mentioned that, there is one thing which cannot be overlooked.
Visit the following page:
www.appliancesyouneed.co.uk/index.php?pid=delivery
where site 1 boasts to have a fleet
of 10 trucks for timely delivery, yet on their terms and conditions page, under the delivery section
they state that deliveries can take up to 21 days. Additionally look carefully at the image on this page and compare it to the
image on
www.trade-appliances.co.uk/aboutus.html.
So the question is which company actually owns the fleet of trucks! Of course appliancesyouneed is trying to fool the visitors.
What Appliancesyouneed have done right to lure the customers
What Appliancesyouneed have done wrong
(Points to remember for protection against fraud)
As a result of this investigation we would like to issue a warning
to our members to be extremely careful and vigilant whilst trading
with this company as all the above information points towards
the company being a scam, however we would like to refrain from
accusing them directly and leave this decision to you.
Lastly, we have also contacted trade-appliances regarding this
and they have confirmed that they have no connections with appliancesyouneed.co.uk
and this is how they have responded to our mail.
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Dear Mark,
Thank you for forwarding this information to me, you are quite
right, they seem to have copied and pasted pretty much everything
from our web site.
As you point out, the truck image is a picture of our trucks
and the building behind is where I sit typing this email!!!
I appreciate you taking the time to do this and will now be taking
action to remove this web site.
Kind Regards
Emma Lowe
E-Commerce & Marketing Manager
Trade Appliances Group Ltd.
www.trade-appliances.co.uk
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Lastly, do remember that we are always here to answers your queries.
Best Wishes and Kind Regards.
Rob Kent
Wholesale Pages.
www.wholesalepages.co.uk |
