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Beware of going-out-of-business sales, warns Federal Trade Commission

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Posted at 3:59 PM, Dec 06, 2019
and last updated 2019-12-06 16:30:14-05

INDIANAPOLIS — As Christmas approaches, many shoppers are looking for a good deal, and going-out-of-business sales can seem like a great opportunity.

The Federal Trade Commission issued a warning this week urging consumers to do some comparison shopping.

Check to see if someone is selling the same, or similar, products somewhere else for less.

You can even use your smart phone to compare prices online while you’re out shopping.

Also, make sure you know who is handling the sale.

Many large stores sell off their merchandise to third-party liquidators, who hold the sale.

“Liquidators may base discounts on the manufacturer’s suggested retail price, which often is higher than what stores typically charge,” the FTC said. “That means items can end up costing more than they did before the sale began.”

Keep in mind, liquidators generally don’t honor coupons or store credits.

And don’t count on being able to get your money back, since most going-out-of-business sales have a strict “no refunds or returns” policy.

Also, look things over carefully before you buy them to make sure they’re in good condition.

If you have a gift card for a store that’s closing for good, make sure to use it right away.

“There may be a deadline to use it,” the FTC said. “After that, your card will be worthless.”

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The FTC says a company can only advertise a going-out-of-business sale when it is actually going out of business.

"It’s against the law to advertise a going out of business sale when a store isn’t, well, going out of business," the FTC said. "If a store in your area is advertising what looks to be a bogus going out of business sale, tell your state Attorney General’s office."

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