Guarantees: Why goods must be fit for purpose
When you sell a product or service, it must be suitable for the purpose the customer told you about. If it isn’t you may have to compensate them, eg by refunding their money or replacing the product. Read our case studies for examples of getting it right and wrong.
What ‘fit for purpose’ means
This guarantee means a product must be fit for any particular purpose:
- a customer tells you they want it for
- you say the product is fit for.
For example, if you sell gardening equipment and a customer tells you they want a machine that cuts grass very finely for their entry in a gardening competition, you may get caught out if you sell them a machine that roughly cuts up their lawn instead.
If you don’t meet this guarantee, customers have certain rights against you.
You can read examples of how the rule works at these links:
Returns, refunds and repairs (external link) — Consumer protection
Consumer guarantees for products (external link) — Consumer Protection
What you should do?
If a customer doesn’t describe what they’ll be using your product or service for, ask them. You can then advise them — before they buy — if you think it will suit their purpose or if another product or service will suit them better.
Guarantees that a product or service will be fit for a particular purpose don’t apply if a customer chooses to buy something you’ve told them won’t be suitable.
Understanding the Consumer Guarantees Act (external link) — Consumer Protection
To ready full article please click here. Article first appeared on Business.govt.nz