The Directbuy Scam, Be carefull ! Options

[flashman]

I was invited to visit the local Direct Buy to hear a presentation on the organization. After hearing about the potential benefits on becoming a member the attendees were told that if they did not choose to join on that specific day and pay the membership fee of $3,900 they would not be eligible for membership in the future.

After hearing that I walked out.

So if you every get invited to visit and hear the presention be prepared to fork over $3,900.


Afterwards I Googled "directbuy scam" and "directbuy con" and got some very interesting results.

What's the experience of others?

[krs99]

I was invited to visit the local Direct Buy to hear a presentation on the organization. After hearing about the potential benefits on becoming a member the attendees were told that if they did not choose to join on that specific day and pay the membership fee of $3,900 they would not be eligible for membership in the future.

After hearing that I walked out.

So if you every get invited to visit and hear the presention be prepared to fork over $3,900.
Afterwards I Googled "directbuy scam" and "directbuy con" and got some very interesting results.

What's the experience of others?

This was posted on RFD a while back:

I was recently employed with Directbuy Hamliton/Niagara, Ill save you the time and the 4200 membership fee! They are a scam! They only get people that are stupid and have money! The way they talk about prospect customers is degrading and direspectful! Do NOT and i mean DO NOT attend an open house! And if you not trust these words, please visit www.Ripoffreport.com. Type in Directbuy, you'll find your answers!

If you want to save some REAL money and have a bit of time each day to check a web site, I would suggest you check out RFD.
http://www.redflagdeals.com/

[lyn]

I was invited to visit the local Direct Buy to hear a presentation on the organization. After hearing about the potential benefits on becoming a member the attendees were told that if they did not choose to join on that specific day and pay the membership fee of $3,900 they would not be eligible for membership in the future.

I never understood that concept ..you pay a hefty membership fee to buy only from them at higher prices that you could get on things if you shop around.
It is like timeshares!!

[balsam]

Thanks so much for this info. I recently received an invitation saying that they were holding a spot for me at their latest open house. It sounded good, but didn't say anything at all about a membership fee!! I am considering having some renovations done, and it did sound like a good thing.

[wildie]

I attended one of these scams and walked out. The salesperson that invited me, almost tackled me as I was trying to escape.
Its an out and out scam. The one in our town has been in operation for over 5 years and is still in business.
Seems that we have a lot of people with lots of money and no brains.

[flashman]

I attended one of these scams and walked out. The salesperson that invited me, almost tackled me as I was trying to escape.
Its an out and out scam. The one in our town has been in operation for over 5 years and is still in business.
Seems that we have a lot of people with lots of money and no brains.

I'm amazed that they're still operating given their dubious business practices and our various consumer protection agencies.

[kcowan]

I'm amazed that they're still operating given their dubious business practices and our various consumer protection agencies.

They are doing nothing illegal (same as timeshare sales). Unfortunately we have no laws to protect consumers from unethical behaviour (and making uninformed decisions).

It is the same with fund companies that charge investors a sales charge and then take 3% of their money every year regardless of how the funds perform. Unethical but not illegal so the only answer is to try and educate the consumers.

I think PT Barnum had a good expression for this phenomenon!

[delphi51]

It might be a good idea to keep a laptop handy so one can check up on these sales people.
We had a guy in the other night trying to convince us we needed $900 worth kitchen knives. Cutco. Later I looked up Cutco and found their knives are vastly overpriced and anyhow available on ebay at half price.

Lucky we already had more knives than fit in the knife drawer.

Anyway, better not to let them in the door.

[pizztank1]

Direct Buy relies heavily on testimonials for advertising. This is a very effective way of convincing stupid people that this is really a satisfied customer. These people are actors and are paid to lie to you.

[maxicat]

I saw one of their ads on TV last year for the exact same air jet bathtub I installed last Summer when I renovated the bathroom. Their "special" member's price was just over $1300. I bought my tub locally for $1100. That should tell you something about Direct Buy.

[Guest_DirectBuy_GV_*]

Hello Consumers!

I'd like to take the time to explain our process to people who are reading this inquiring about DirectBuy. I'm an employee of a local Vancouver BC showroom and here's our side...

Re: Ex-Employee
When people come online acting as if they are or were an employee of DB they are usually an unhappy retail sales employee. No, retail people don't like us I wouldn't either if I was in retail. They need to make money just like everyone else but their way can be avoided through DirectBuy.

Re: Making a decision at the OpenHouse.
Yes we ask you to decide at the open House if you'd like to be a member. No you don't have to pay the fee's upfront there are several different types and lengths of memberships that are affordable to any working consumer. It is stated in the information and at our location we highlight it in bright yellow as to not be a surprise that's what you are coming to determine after you have seen what we have to offer, the brands we carry and compare pricing all you want. You are welcome to bring in any price for us to compare for you, it's best to bring in SALE pricing!

Re: Time Share
I've never seen a timeshare that saves you thousands of dollars on the things you are going to buy anyways. Going on a vacation doesn't always happen, buying for your home does, no homeowner can argue that.

Re: Ad on TV vs the "same tub" at a cheaper price.
It's impossible to tell from TV the brand of tub or the model number. Pricing will vary greatly depending on the model, year and mauf. DirectBuy pricing is cost pricing we don't sell the products. What we pay you pay because you are buying it from the manuf not us. The price you see is the price the manuf sells it to the retail stores before they mark it up to sell you.

Re: Renos
If anyone is doing renovations I highly recommend going to check out DB for yourself and make your own educated decision. There is a huge savings available what do you have to lose by going to see for yourself? There is no obligation to join and if its not something for you the answer is no I don’t want to join and if you see the benefits then the answer is yes I want to join.

Re: Still being in business
Our members in the last year at this location alone spent $1 Million dollars a month in purchases. Throughout the network last year our members spent $1.1 Billion. That increases every year from the year before. Our members would not be buying that kind of volume if we didn't save people money.

We've been around for 37years and continue to grow rapidly. We started out with 35 manuf we now have over 650 in Canada on top of local suppliers, installers, interior designers, builders, landscapers etc etc that are fully approved reputable and used by over 20.000 members at this one location.

Re: Testimonials vs Paid Actors
The members that we use for testimonials are members. If they were not that would be false advertising and illegal. One of the members on the local Canadian advertising is a member at this location in Coquitlam BC, they are from Surrey B.C. and we see them regularly.

If you're interested in making your own educated decision on DirectBuy feel free to visit your local Showroom for a no obligation Open House.

www.DirectBuy.com

Coquitlam: 604-552-5255

[flashman]

Hello Consumers!

I'd like to take the time to explain our process to people who are reading this inquiring about DirectBuy. I'm an employee of a local Vancouver BC showroom and here's our side...


Re: Making a decision at the OpenHouse.
Yes we ask you to decide at the open House if you'd like to be a member. No you don't have to pay the fee's upfront there are several different types and lengths of memberships that are affordable to any working consumer. It is stated in the information and at our location we highlight it in bright yellow as to not be a surprise that's what you are coming to determine after you have seen what we have to offer, the brands we carry and compare pricing all you want. You are welcome to bring in any price for us to compare for you, it's best to bring in SALE pricing!

[
www.DirectBuy.com

Coquitlam: 604-552-5255].

Yes but you don't inform people before the open House that they will be expected to make that decision while in the presentation and that if they decline they will not be invited to join again

[diboja]

The Bottom Line
The lack of price transparency makes it hard to evaluate whether you’ll save by joining DirectBuy. But even if you were to save 25 percent on purchases after joining, you’d need to spend more than $20,000 just to recoup your membership fee. DirectBuy might save you money if you’re furnishing a house from scratch or doing a major renovation. But since you can’t shop around beforehand, you’ll be joining blind.

Consumers report on Direct Buy - With DirectBuy, it will cost you a lot to save
http://blogs.consumerreports.org/home/2007...directbu-1.html

[kcowan]

From the consumer feedback at Consumer Reports:

Really, it's 100% completely obvious that DirectBuy is a scam. Even the people defending DirectBuy don't dispute the clear and obvious evidence that DirectBuy is a scam.

1) They use the type of high pressure sales tactics that *only* scams use. I know of no legitimate business that locks you in a presentation for hours with a personal salesman.

2) They demand you make a huge financial decision immediately and back that up with threats. They don't just try not to let you have time to make a reasoned decision, they literally will not let you have time.

3) They provide you no opportunity to assess the value of what you are buying prior to committing. They only permit you to change your mind where they are required by law to do so.

4) They disclaim any verbal promises and don't give you a chance to review the written promises.

So it's a scam. Obviously so. There's not even any doubt. These three things are the clear hallmarks of a scam.

Not every scam tells outright lies. Some use more subtle deception that may even be legal. Not every scam outright steals money from every person. Even in a Ponzi scheme, some of the first people to join may make money.

Note that the people *defending* DirectBuy don't even dispute the facts that make it a scam. They just say it's not a scam because some people benefit from their membership. That argument doesn't even make logical sense. If nobody benefited from DirectBuy, they wouldn't be in business.

I think the evidence shows that it is not a scam. The high pressure sales tactic is just that. It is used in many questionable products like timeshare sales, swamp land sales, FX trading schemes and other high risk investment approaches.

But like timeshare, it is possible to work it and make the savings work for you. Is it better than other alternatives? It depends.

[kcowan]

DirectBuy Sued

DirectBuy Sued! A federal lawsuit has been filed in U.S. District Court in Hartford against the national high-end DirectBuy franchise operation, accusing it of falsely telling prospective clients that they are getting furniture, appliances and other household products at manufacturer prices. In a lawsuit filed by attorney Seth R. Klein of Hartford, DirectBuy is accused of hiding the fact that DirectBuy receives rebates from manufacturers which are not directly passed on to their members, who pay as much as $7,000 to join for two or three years. The lawsuit, which seeks to be certified as a class action representing thousands of present and former members of the more than 100 franchises, was filed earlier this month. It follows a column on DirectBuy that disclosed the rebates, which are kept secret from its members and from those it entices to join through high pressure sales techniques. DirectBuy officials had no comment on the suit but had said earlier that it uses the millions of dollars it received in rebates to the benefit of its members. We will see what a jury has to say about that.

Is it fraudulent to mispresent their cost of goods? Do they say they just make money from the user fees and deny manufacturers kickbacks? If so they might be found guilty. The outcome of this case should clear the air regarding DB pratices.

Here they get a 2 out of 5 ratings from 501 people.

9/25/2008 - Sam of Alberta, Canada writes:

We have been DB members for 4 years and have regretted it ever since we joined. The service at our location in Calgary is abysmal. The sales people are virtually useless and do nothing except put your order in. All of our custom orders have been screwed up and they don't have the whole line of a manufacturers goods as they supposedly claim to. If you do have a problem, good luck getting it resolved. We have saved money on a few things but it's not worth the cost of putting up with the lousy service.

ISTM that DB will only work if you are buying high markup retail goods and have no way to get them wholesale. Many contractors can get things cheaper. Our contractor gets 22% off from Home Depot.

Lawsuit article (Hartford Courant

[don_f]

I generally feel very ripped off dealing with local retail for any big ticket item.
I know that their mark up is ridiculous.
But when companies deal with me directly instead of going through local retail they often charge me even more that local retail is charging me, so as not to offend the local retail channel.

When an online retailer is offering a price well below what local retail is offering, even with UPS delivery, I am sorely tempted to try it, at least for an item that costs me an amount that I can afford to lose. I know this leaves me at risk of scams, so I do a bit of checking to see if there are claims of fraud against the online retailer. I also use actual model numbers to check pricing. But some local retailing chains get unique model numbers with identical merchandise. I tend to see local retail as being at least as likely to scam me on model identity as any online retailer.

The problem with online retailers, even when they have no record of fraud, it may mean only that they are new on the scene. New online vendors can show up with hundreds of thousands of products in an online catalog, even scam you by cloning someone else's catalog with their own shopping cart, their own secure ordering website, and never deliver anything. This can be done overnight with a professional look that tells most people this must be a well established company.

Now DirectBuy probably could reduce its up front fee to almost nothing and build its costs into the manufacturer rebate scale, just as any online retailer would. I see nothing unethical about doing that, as long as that relationship is specified. I have refused to pay up front membership fees for all kinds of buying systems except a coop. I have not convinced myself that Co-ops have been a consistent savings, but their presence has always helped to avoid problems of lack of competition. Mostly, Co-ops do not have a big up front fee, do not pretend that they do not make profit. Just that profit if any is returned to members, losses if any are eventually borne by creditors if the losses are not recovered.

[Guest_DB member_*]

I can only speak for the 2 centers I have worked for that being DB Vancouver and DB Greater Vancouver, both of which give members the manufacturer rebates. I was trained to inform people in the New Member orientation about the rebates.

Re: Decision, again

On the information it states becoming a member of DirectBuy requires you to do so at the open house you attend. My location highlights it in bright yellow highlighter so it's not missed. If you have further questions about this please read up as I clearly covered this point.

DirectBuy does things a certain way for a reason. If you don't like it, don't join it's that simple. The only pressure people feel about the whole process is the pressure they put on them self. DirectBuy does not force anyone to do anything. If you want to buy at cost or learn how you are able to buy at cost, go check us out. If you're not interested or too skeptical then don't waste your time.

Re: Bad Sales people

Direct Buy does not have sales people other then to sell memberships. The Customer Service Rep's are there to process orders and if they are not processing orders they are there for assistance but they are usually processing orders. Yes it takes some time to get used to and if you have questions or are frustrated then you need to talk to the Center you're a member of and sort it out. DirectBuy provides a service for buying directly from manufactures it's the members responsibility if they are not happy to rectify the situation or get the information you are requiring.

I've been a member for 7years, I joined when I was 19 and yes I paid the fee's as well. It's an investment for me as I don't own yet but I still consume lots of things and recently moved into a place where I need to fully furnish.

[Guest_DB member_*]

Re: Contractors pricing

We have tons of members that are interior designers, contractors, builders etc etc what they find is that the selection of Direct buy is much more extensive then they will ever have. No one buys everything at DirectBuy, even I don't. I still go to retail stores I love to shop but I'm not going to waste my money on something that's $1000 retail that I know I can get for $500 at DirectBuy. Even something that's $500 that I can get for $300 I won't buy retail. Members are all different and use us for various things and various ways.

Re: the scam comment and me not denying that.

I haven't commented on that because the people ranting about DirectBuy being a scam are uninformed and what I want to do is properly address the incorrect accusation or concerns not argue. if it makes you feel better....

DirectBuy is not a scam

[flashman]

Re: the scam comment and me not denying that.

I haven't commented on that because the people ranting about DirectBuy being a scam are uninformed and what I want to do is properly address the incorrect accusation or concerns not argue. if it makes you feel better....

DirectBuy is not a scam

My experience is that I was never advised when I was invited to visit and I would only have one chance to join for a significant amount of money. I felt that I had been ambushed.

I didn't see any information about this on my invitation. If it was there it wasn't clear since I missed it so it needs to be more clearly stated on the invitation.


I am not alone based on the following


http://tinyurl.com/26uzoo

http://tinyurl.com/4vd84d

Just Google "Direct Buy Scam" and see what happens.

So there's obviously something wrong with Direct Buy's methods.

Add the fact that almost 18,000 people have viewed this thread and hopefully many of them have rejected the approach then some improvement is necessary.

[Guest_DirectBuy_GV_*]

Google any company. There is bad about all Companies that's not a lie. It states it in all information. If you didn't read it that's unfortunate, we even ask on the phone if you had a chance to read the information.

If it was our purpose to ambush people that would be pretty stupid on our part. We qualify people on the phone. Yes it's a one time offer, no people don't like it, yes we have to do it for confidential agreements with our Manufactures. Anyone who attends an open house is able to see any brand we carry, check out any pricing and ask any question they want before deciding on membership.

There are different payment plan available if you don't want to pay the fee's upfront, there are other options.

If you wish to attend an Open House of Direct Buy you are asked if you want to be a member, you are also asked to make the decision before leaving if you want to join or not. Go prepared and informed, read the information. If you're skeptical bring pricing. Ask anything you want at the open house and if you're reading these forums and have more questions ask your local center, that's the only place to find legitimate answers.