The Good Guys Ordered to Pay $13.5M Fine Amid Store Credit Controversy

Major Penalty for Leading Australian Retailer

The Federal Court has handed down a $13.5 million fine to national electronics retailer The Good Guys, a JB Hi-Fi subsidiary, following proceedings by the Australian Competition and Consumer Commission (ACCC) over misleading conduct related to store credit and StoreCash promotions that affected more than 21,000 eligible customers.

Background and Scale of Operations

The Good Guys Discount Warehouses is a prominent chain of consumer electronics and white goods retail stores across Australia, with its national headquarters located in Melbourne’s Southbank district. Currently operating over 100 stores nationwide with 3,500 employees, the company maintains both physical stores and an online presence, offering customers the flexibility of home delivery or click-and-collect services.

Details of the Controversy

The issue stems from 116 promotions conducted between July 2019 and August 2023, where customers were offered store credit ranging from $10 to $1,000 based on minimum spending requirements, specific brand purchases, or payment methods. The retailer failed to issue credits to approximately 21,500 eligible customers within the promised timeframe. As part of the court order, The Good Guys must now provide replacement store credit with extended expiry periods to affected consumers, with the company already having begun remediation efforts for impacted customers.

Current Business Operations

The Good Guys maintains a comprehensive product range, specializing in entertainment technology including TVs, smartphones, and speakers, as well as both large and small home appliances such as fridges, ovens, coffee machines, and other kitchen appliances. The company’s financial performance shows stability, with sales reaching $2.81 billion in the 2023 financial year, a slight increase from $2.79 billion in the previous year, following a more substantial 2.7% growth from 2021 to 2022.

Community Engagement and Social Responsibility

The company demonstrates social responsibility through The Good Foundation, established in partnership with celebrity chef Jamie Oliver and the Queensland state government. This initiative aims to improve community health and social welfare across Australia, with a particular focus on addressing obesity, nutrition, and diet-related issues. Additionally, all stores contribute a percentage of their transactions to local community organizations, with customers able to vote for their preferred charity using a token system.