Product & Service Information

Product & Service Information

Introducing The Issue

It is a basic responsibility of any business to provide essential information about its products and services that is easily accessible, complete, not confusing, and stated in plain and understandable language.

Questions For Managers

Responsible 100 has developed a number of introductory questions to help you explore this important issue and your organisation's exposure to it. Please respond with as much relevant information as you can. These questions are available via this Google Form.

Questions For Employees

Responsible 100 has developed a number of questions specifically for employees. They are designed to enable people working in the organisation to share their thoughts, observations and opinions on this important issue. Please respond with as much relevant information as you can. (These questions will be available via a Google Form soon.)

Benchmark Performance Statements

EXCELLENT - The provision of good product and service information is a key strategic issue and/or of fundamental importance. Customers are provided useful and relevant information to enable them to make fully informed purchasing decisions as a matter of course.
GOOD - The business demonstrates a clear commitment to providing relevant and accessible product and service information and has clear policies and practices in place.
OKAY - The business meets regulatory minimums regarding product and service information and adopts some best practice but only on an ad hoc basis; OR the business explains why the issue is not relevant and material to it.
POOR - The business acknowledges performance below expectations; and/or it has made claims which are unsubstantiated; and/or which have been criticised in the media; and/or by authorities or third parties. Providing inadequate or downright false and misleading information appears to be standard and intentional practice for the business.

Responsible 100 creates and develops detailed benchmarks on each of the issues we explore. Each benchmark identifies and defines different levels of performance as either POOR, OKAY, GOOD or EXCELLENT. A general statement describes those four performance levels in summary. Under each statement, examples of the sorts of policies and practices businesses are observed pursuing are listed, usually broken down into categories, e.g. Policies & Procedures; Target Setting, Measurement & Reporting; or Leadership, Advocacy & Culture. Some such lists include 50 or more examples. The above reveals the current summary statements only. The complete benchmarks are shared with those organisations which, through offering answers to the above questions - and any other relevant details about what they do, how and why - help to shape and improve the benchmarks on an ongoing basis.

Exploring The Issue

When selling products and services, certain core areas are generally covered by consumer protection law. In the UK, this includes safety, pricing, weights and measures, descriptions of products and services, the contract between a buyer and seller, competition between businesses, intellectual property and counterfeiting. The United Nations also requires businesses to make sure their consumers are well-informed not only about their products, but also of their rights as consumers. This includes information related to health and nutrition, product hazards, environmental impact, the use of materials [including energy + water], and electronic commerce.

Businesses that are selling services, to individuals or other businesses, have further obligations and some sectors are more tightly regulated than others. For example, under UK law, the main features of the service being offered should be explicit, if not already apparent from the context. Generally, if a price is not predetermined, a business must be able to supply a detailed estimate so that a client can use the proposed method to calculate the cost, check the figures and arrive at the price. Service providers may need to provide the terms and conditions used, including information on any contract terms that are governed by the law of a particular country.

However, consumer protection legislation is not exhaustive. In some cases, companies can get away with making false claims about their products due to loopholes in the country’s consumer protection laws. For example, Tic-tacs are able to claim that they are sugar-free (despite being made almost completely of sugar) by manipulating their serving sizes so that the US Food and Drug Administration can’t legally require them to report the ingredient’s percentage to their consumers. Because of companies and products like Tic-tac, many countries have seen an increase in lobbying for consumer protection laws to insure that consumers are protected from inaccurate product description and deception by companies.

In 2013, the UK passed the Consumer Contracts Regulations that applies to all businesses in Great Britain. The regulations aim to protect consumers in deals made with businesses off-premise, from a distance, and digitally. These regulations are especially relevant as the world has become increasingly digitised. It requires businesses to inform consumers of:

>> A description of the goods, service or digital content, including how long any commitment will last on the part of the consumer

>> The total price of the goods, service or digital service or the manner in which the price will be calculated if this can’t be determined

>> How consumers will pay for the goods or services and when the product/service will be provided to them

>> All additional delivery charges and other costs (and if these charges can't be calculated in advance, the fact that they may be payable)

>> Details of who pays for the cost of returning items if the consumer has a right to cancel and change their mind

>> Details of any right to cancel - Businesses also need to provide, or make available, a standard cancellation form to make cancelling easy

This information should be provided to consumers in a ‘durable medium' such as on paper or by email. It should be easy to access for anyone. Despite regulations like this many consumers still lack basic protections and as the world has globalised and digitalised, changes to the global marketplace are outpacing consumer protection.

Definitions

After-sales Service: any service provided after a customer has purchased a product including support regarding warranty service, training, or repair and upgrades.

Competent Authority: a body with a regulatory or supervisory role over the provision of a service, such as a professional body or a central or local government authority.

Consumer Contracts Regulations [2013]: apply to contracts made both on and away from business premises, as well as contracts made 'at a distance'; there are also rules for businesses providing digital content. These Regulations affect most businesses that contract with consumers, irrespective of where and how the contract is entered into.

Consumer Education: providing resources that advise consumers of price and trade information from businesses

Green Claims Code [2021]: Legislation passed by the CMA to prevent businesses from misleading consumers on eco-friendly claims

Greenwashing: Misleading claims about the environmental impact of a product, brand, business or service, without evidence to back it up.

Product: something that is made to be sold, usually something that is produced by an industrial process or, less commonly, something that is grown or obtained through farming

Provider: means a body or individual that provides a relevant service within the EEA. Most of the Regulations only apply to providers who are established in at least one EEA state.

Service: means a self employed economic activity (normally provided for remuneration).

Terms and Conditions: the document governing the contractual relationship between the provider of a service and its user

United Nations Guiding Principles for Consumer Protection [2016]: “a valuable set of principles for setting out the main characteristics of effective consumer protection legislation, enforcement institutions and redress systems and for assisting interested Member States in formulating and enforcing domestic and regional laws, rules and regulations that are suitable to their own economic and social and environmental circumstances, as well as promoting international enforcement cooperation among Member States and encouraging the sharing of experiences in consumer protection”.

Links, News And Further Resources

Articles

Products and Services: Examples and Best Practices - 28 April 2022

Gives individuals a guided understanding of after-sales service support. Article includes examples of after-sales support and explains how it leads to higher customer satisfaction, and brand loyalty.

What is Greenwashing? - 17 January 2022

Explains what greenwashing is, how it can harm a brand’s reputation, and how businesses can avoid greenwashing. Article also introduces the Green Claims Code and talks about their key principles (must be truthful, etc).

Winning in the After-Market - May 2006

Highlights the importance of after-sales services in businesses. “According to a 1999 AMR Research report, businesses earn 45% of gross profits from the aftermarket, although it accounts for only 24% of revenues”.

Resources

Knowing Your Product and Services - 24 June 2016

This resource provides information about how users can be knowledgeable about their products/services and how they can turn their product features into benefits.

The Consumer Contract Regulations - 2013

Applies to contracts made both on and away from business premises, as well as contracts made 'at a distance'; there are also rules for businesses providing digital content. These Regulations affect most businesses that contract with consumers, irrespective of where and how the contract is entered into.

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