Vodacom's take on the CPA: Revised

TRADE COMMUNICATION


TO ​:​All Trade Partners

FROM​​:​Vodacom Sales and Service Support

NUMBER​​:​Amendment to Bulletin 11 - 0160

DATE​​: ​31 March 2011

SUBJECT​​:​Consumer Protection Act – Version 2
​​​Detail pertaining to Returns, Repairs and Refunds.


Dear Trade Partners,

With reference to the communication distributed on the 25th March 2011, attached hereto please find the most recent revisions. As per the previous format, the documents are explained in the below body of the document and the associated forms with the new logo are attached to the mail for ease of reference / use. Kindly note that the relevant documents can be obtained on Dealerweb – printable documents. Most of these documents will be converted into pre-printed books and distributed to the relevant users during April 2011. In the interim, kindly make use of the attached versions.
Kind regards












Vodacom endeavours to ensure that the information contained in this document is true and correct, but does not accept responsibility for any error or omission. The development of training material is ongoing; therefore published information may not be up-to-date. Vodacom SA cannot accept liability for any loss or damage of any nature whatsoever arising or resulting from the use of or reliance on information or particulars in this document. This document is not legal advice and may not be construed as such

The spirit of the Consumer Protection Act
For sales and service entities, the overriding message that should be received from the CPA is that we need to take more care during the sales interaction and if/when the customer makes contact with us after the sale, we need to listen and respond to their request in a fair and timeous manner.
This communication follows the content that has been shared at a Regional level during the course of last year and has been trained by the Vodacom Academy over the last few months. The intention of this communication is to provide practical support information in terms of workflows and documentation for use whilst considering the CPA in the context of Returns, Repairs and Refunds.

1. Sales Interaction
2. Refunds and Returns as a result of the Sales Interaction (14 calendar days)
3. Returns as a result of Open-Box-Failure / In-Store Failure (7 calendar days)
4. Returns, Repairs and Refunds as a result of a faulty device (6 month warranty)




















1. Sales Interaction

• The customer comes into the sales store to do a transaction – remember to smile.

• If the transaction type translates into issuing of a device (handset, modem and/or laptop), we recommend that at this stage, the customer completes Section A on the Customer selection confirmation form. The sales consultant should explain to the customer that the more specific the information, the more satisfied the customer will be with the end product.

• During the final consultation with the customer – when the device is issued to the customer, the remaining applicable sections on the Customer selection confirmation form should be completed.

• The final consultation is a critical interaction which must provide for a high quality closure with the customer as this is the interaction that protects the store in terms of providing a final check that the customer is in agreement with their transaction. The Customer selection confirmation form is for in-store purposes and therefore unless the customer requests a copy, it is not necessary to provide one.

• It is also a requirement of the Act that an invoice (proof of purchase) detailing the transaction, is issued to the customer.

• Once the sale is complete, ensure that a Customer information leaflet is issued to the customer. (Based on the brand refresh, brochures to this effect will be circulated to stores early in April 2011).

Why complete the Customer selection confirmation form?
As outlined in (2) in this document, it will safeguard the store from customers making claims regarding their communicated needs as well as providing for a burden of proof in terms of a signed customer declaration.
Why provide the customer with an invoice, proof of purchase?
Whilst it is a matter of compliance with the Act, the actual date of purchase and/or delivery date (whichever is the date on which the device was actually received) will become our “qualifying” date in terms of checking criteria as outlined in (2,3,4) in this document. The importance of communicating that the customer should retain this invoice (proof of purchase) and/or delivery note is therefore essential. An important change in application to note is that historically an activation date on our network was applied and whilst this remains important, in the context of implied warranties, the new date being applied is the original date as specified on the invoice (proof of purchase) and/or delivery note.
Why issue the customer with the Customer information leaflet?
The revised Customer information leaflet will be available in a brochure format presenting information that we have deemed to be pertinent to the customer. Whilst the information is not a contract agreement, it does provide for terms and conditions of the Vodacom Repair environment and also outlines information contained in terms of the CPA and Vodacom’s approach – in the form of our processes, areas of responsibility and requirements. The Customer information leaflet furthermore supports our strategy of customer obsession in terms of providing information that empowers the customer. One of the challenges that Vodacom experiences is that our customers tend to receive various messages regarding standard information in relation to their transactions. The Customer information leaflet provides a standard that can be applied pertaining to general information. Often we experience complaints due to customers not having information on hand and thus only receiving the information when something goes wrong i.e. while the customer is negative.
A Customer obsessed approach does not allow us to provide this information reactively/retrospectively but rather requires that we engage proactively during a sales interaction so that the customer can hold us to the noted information but we simultaneously achieve a more accurate customer expectation. Due to the fact the sales touch point is the origin of our relationship with the customer, it is important to set this empowering tone upfront.
• Customer selection confirmation form – original f or use attached to the mail.

Only complete relevant section pertaining to transaction type

Give the customer the opportunity to place their needs in their own words in writing. If none, customer must state none






Receive a declared confirmation from our customer which serves as your “burden of proof”




Wherever you see this, make sure that our customer understands the section and initials accordingly







These are standard forms currently in use that must be issued to the customer in relation to their transaction – kindly note that these have been updated and will be included in the brand refresh documentation. The Device Warranty Agreement is one of the important forms that impact 3 and 4 in this document)









The addition of the YES / NO confirmation under Insurance has been included in this form but the actual form must still be completed.



Even if the customer has signed other sections of the form, make sure one last time that the customer is satisfied with their transaction, provide them with the proof of purchase and obtain their signature and date the document




2. Refunds and Returns as a result of the sales interaction (14 calendar days)
After the sales interaction has taken place, the most likely next interaction between the customer and the store where their purchase was made will either be the customer communicating dissatisfaction relating to their “user” experience (fit for purpose and suitability) with the device (non-technical); or technical related matters (faulty device). Technical related matters are outlined in (3 and 4) of this document.

• Refunds and returns in the selling environment refer specifically to day 1 to day 14 after the actual purchase date (as per original tax invoice / proof of purchase).

• These devices are classified as “not fit for purpose” and as a result, don’t satisfy the customer’s particular needs AS COMMUNICATED TO THE SALES CONSULTANT DURING THE SALES INTERACTION. (Reason: dysfunctional sales interaction). Vodacom Repairs stores will not become involved in these scenarios at all. This is specifically between the sales outlet and the customer that transacted with them.

• The scenarios that apply are:
i. The Customer did not have the opportunity to examine the goods (a reasonable replica / sample of product has to be available). The absence of this opportunity to examine goods leads to (2 - below). All sales stores will be responsible for establishing their own approach in terms of ensuring that customers are given the opportunity to examine goods prior to the transaction. It is however recommended that in the absence of the goods being available to examine that the customer is encouraged to view the goods elsewhere prior to purchasing. This may lead to the risk of losing the sale but the converse is that in the absence of providing such an examination opportunity, the store remains at risk. Perhaps a quick inspection on receipt of goods will limit the risk. Customers should be informed while completing the Customer selection confirmation form that they are confirming that they have examined the device (in the sales store or elsewhere).

ii. The goods or services do not meet intended purpose – this does NOT mean that the customer can return products purely because they won’t use certain functionalities but rather implies that IF the sales consultant did not provide an accurate specification, OR if the sales consultant did not take note of the customer’s specifically communicated needs (preferably outlined on the Customer selection confirmation form, that the customer can return the product. It is critical that sales consultant establish that customers understand all aspects of their purchasing decision.

• If a refund needs to be given to a Customer because the customer did not confirm the selection of the handset or the sales person did not represent the intended purpose of the features correctly, the onus to refund or exchange a handset for the customer will be on the selling store.

• The burden of proof from the selling store’s point of view will be the signed Customer selection confirmation form - in the absence of this, the outlet does not have sufficient proof of the customer's confirmed expression that they willingly agreed to the handset etc and were duly informed – therefore the selling outlet has to refund the customer.

• A request has been made to all manufacturers that they provide accurate specifications which are not only comprehensive in terms of the selling features but also the shortcomings of specific features and the specific definitions on a particular product – i.e. Blue tooth has a general definition, if however Bluetooth on a particular product does not link to a printer etc, the customer has to be informed. This MUST be communicated in lament terms. If a sales store experiences a scenario such as the above where it is evident that there are shortcomings in the manufacturer specification which has resulted in a refund/return scenario, then the store may process this device via the OBF procedure (3) in this document; but ensure that an explanation accompanies the device (and required documents) – as this will facilitate the attention that needs to be given to this scenario.

• When are suppliers NOT entitled / forced to refund consumers?
A supplier is not obliged to accept returned goods and refund consumers their monies where:
• In respect of direct marketing:
− the consumer cancels the agreement long after the cooling-off period has expired.
• In respect of retail stores:
− the consumer was afforded an opportunity to inspect the goods prior to their purchase and subsequently changed his/her mind about the goods;
− the goods have been damaged, due to negligence;
− the goods have been disassembled, physically altered, permanently installed or combined with other goods or property; or
• In respect of repairs:
− the consumer did not adhere to the manufacturer instructions; or
− did not keep proof of repair.
• Change of Mind’ Returns and Refunds
In the event of consumers returning goods because they have changed their minds, suppliers are not obliged by law to accept returns and refund monies. Suppliers can honour these returns and refunds out of goodwill/courtesy.

• Sales store return / refund scenarios:
Carefully view the various scenarios that emerge as a result of the transaction type. Where possible, refunds and returns must be actioned within 5 calendar days, the customer must be informed of the expected time frame of final closure.

Contract and Upgrade
Due to the device being linked to an agreement where the device is not settled until this implied agreement period has elapsed, the customer has not settled the device and therefore monetary refunds do therefore not apply. Please word this carefully and escalate any concerns as soon as possible.The options are therefore either:

i. Exchange the device with an alternative make and model in the form of a new commercial pack to the same monetary value (as per prevailing / applicable at the time of purchase cost price + vat). The sales store retains the second hand device (refer to page 8 for alternatives)

ii. Cancel the contract as per the current Dealer cancellation process
Additional info to remember pertaining to contract cancellations generally: many articles in the press referred to a cancellation penalty of 10% which can be levied when a consumer cancels a contract early. Please be aware that this was documented in DRAFT Regulations and until the FINAL Regulations have been published the Act provides for a Reasonable Cancellation penalty. Until the Department of Trade and Industry has finalised the Regulation, Vodacom will continue to apply early contract termination charges as per the Terms and Conditions in our contract agreements. Should you get any queries from customers wanting to cancel their lines and insisting on the 10 % cancellation fee the following guidelines can be used to answer the customer: The act currently prescribes ‘a reasonable cancellation fee’. As per the Draft regulation the Minister intends to prescribe an amount. This prescribed amount needs to be regulated and this legislation is currently in the process of being reviewed for comments. Until such time as the legislation is approved, Vodacom will continue to charge ‘the reasonable cancellation fee’ under the existing terms and conditions on the contract.

Talking Points
As per current procedure, complete a Talking Points reversal.




Other methods of payment (Cash/Credit Card/Gift Card/Vouchers etc)
i. Exchange the device with an alternative make and model in the form of a new commercial pack to the same monetary value (as per prevailing / applicable at the time of purchase cost price + vat). The sales store retains the second hand device (refer to page 8 for alternatives).

ii. Refund the customer either cash or do a credit card reversal. This refund must correspond exactly with the amount paid by the customer. The sales store retains the second hand device (refer to page 8 for alternatives).

• Applying a usage fee
Whilst the Act does make provision for sales related 14 calendar day refunds and returns to apply a usage fee, it should be noted that this cannot apply in the device environment because consideration is given to the fact that a usage fee cannot be applied if a reasonable time frame had to be available for the customer to determine that the device is not suitable. Our Customers will therefore always contest the application of such a fee and given the nature of their purchase, would probably be right in terms of 14 days being a reasonable time frame to make the determination without paying a usage fee.

• Decision making guidelines
The overriding questions that an outlet should be answering when confronted by customers claiming that a device is “not fit for purpose” are:
i. Did the customer have the opportunity to examine the goods or a reasonable sample?
ii. Given what was communicated by the customer during the sales interaction, does the device reasonable meet these requirements (not considering technical fault – refer (3 and 4) in this document).
iii. In terms of other support services such as Data, does the customer have a reasonable explanation as to why the support failed them and since the customer paid a fee, do you believe the solution rendered, matches the fee paid and the customer received what they paid for?

Although the refund/return process in this 14 calendar day scenario is in the sales store’s area of responsibility, we have received numerous requests to assist with a guideline template to ensure that the customer request is managed correctly. The Customer refund pre-screen verification form referred to in this document is therefore only a guideline – original for use attached to the mail.






This criteria links back to the section in this document pertaining to reasons not to refund customers – the burden of proof in the form of the Customer selection confirmation will serve as a very effective tool to eliminate unnecessary requests















What can we (the sales stores) do with our second-hand devices?
There are two options available:

i. You can sell the device as a second hand or demo unit but the price has to show consideration to usage. The customer must be made aware of this and preferably indicate this with a sticker on the exterior of the box.

Whilst the device will in most cases still retain a period of the original implied warranty, it may not be the full 24 month period as the customer only carries the remaining warranty. It should be noted however that we can never offer less than 6 months (as per the Act) and therefore, these second-hand devices should be sold by month 18 to ensure that the customer still carries month 19, 20, 21, 22, 23 and 24. This to them will be a 6 month warranty – only if the device has not lost its warranty whilst in another customer’s care or in-store. It will be prudent to check this with the Vodacom Repairs team prior to making false claims.

ii. Sales store proposal to sell the second-hand device back to VSP through Vodacom Repairs (ARC). This option implies that a sales store can complete a “Request for Vodacom Repairs (ARC) to purchase device” at which time consideration will be given to a number of factors – not limited to the criteria in the form but inclusive of usage and age. These factors will however be outlined on the outcome of the request document and the costing proposed.


Complete store and device details


If approved, a cost calculation to accept the device will be outlined here and mailed back for agreement for the sales store. ARC will retain the device and the same credit process as applied in the OBF scenario will be used to ensure that the sales store is credited.

If rejected, the reason code will be noted here




Ensure that all criteria is checked prior to sending application. If Y applies to all criteria – send the form and the device directly to the ARC in Midrand via RAM (RAM billing should be for the sales store’s account)

















3. Returns as a result of Open-Box-Failure / In-Store Failure (7 calendar days)
Once the above scenario relating to the “dysfunctional sales interaction” has been eliminated and/or the customer immediately implies a technical concern regarding the device, then the sales outlet can check the criteria for either (3) an OBF or in-store failure or (4) other repair solutions offered as part of the 24 month warranty generally and 6 month warranty specifically.


No devices that fall out of the 7 day period can be considered as an OBF. An OBF is merely a Vodacom procedure to facilitate the 6 month warranty requirement in a timeous and fair manner for the customer. OBF is therefore not a CPA requirement but rather a customer enhancement to their warranty offering. For this reason, failing the timeous submission of the device (within 7 days), customers MUST be directed to the repair process immediately to avoid any further frustration.
This process is VERY similar to the current process but more prudent care needs to be taken of the documentation for completion and the commitments regarding timeframes that can be anticipated – i.e. managing the customers expectation. To this end, the Device Warranty Agreement (the old OBF form and iPhone Form) and must be issued to the customer by the sales store with the newly purchased device (BEFORE SOME THING GOES WRONG). It should also be noted that informing customers of their warranty rights is also a CPA requirement and therefore the discussion of this document and applicable warranty terms is not merely process related but compliance related – original for use attached to the mail.












Kindly note that this software remedy step only applies if the Vodacom Repairs technician is able to view the version of software on the device (not for dead devices). ONLY if the device met all OBF criteria in the 7 day period and software was the only criteria not met, will the software performed as a next action provide an additional 7 day return window and/or will a 14 day period (from date of purchase/deliveryapply for the OBF to automatically go through.









Due to the fact that the company has the right to technically assess a device to determine faults prior to exchange and returns (in the warranty period), we have extended the technical assessment time to 5 calendar days. We will however always endeavour to complete this assessment as soon as possible.
If a customer is aware of this upfront, we manage their expectation.






Due to the condition of the device being a MAJOR consideration of refund, return etc, it is essential to point this out to the customer – this point impact all devices, regardless of warranty period. As outlined in the reasons NOT to refund and return, condition of handset is a VALID reason for rejection.


• The OBF / In store failure process
The above two processes will now be facilitated on the same document as it boils down to the same process for the sales store. Sales stores should be reminded that it is irrelevant where the device was purchased, any Vodacom sales store can assist with the OBF and the sales store issuing the device to the customer (store that completed and submitted the form and device), will receive the credit.
The process is outlined below:

For sales stores, the brand refresh documents for OBF will work as follows:
TRIPLICATE, PREPRINTED – original for use attached to the mail.


Page 1 – white, customer copy
Customer retains warranty info

This section of the triplicate will write through to page 2 and 3

Page 2 – grey, accompanies device copy
Page 3 – white, store copy
Page




This is the new collated section for In-store failures

The full document, page 2 is completed and then accompanies the device to a Vodacom Repairs.
THE ONUS REMAINS ON THE SENDING STORE TO ENSURE THAT THE HANDSET IS ADEQUATELY PROTECTED IN TRANSIT TO AVOID ANY DAMAGE.

The customer must sign to acknowledge the outcome AFTER the process is complete










The process continues with Vodacom Repair as follows:







Vodacom Repair Assessment
Page 1 – white, accompanies device copy
Page 2 – grey, store copy
Page

Got to love this:

ii. Cancel the contract as per the current Dealer cancellation process
Additional info to remember pertaining to contract cancellations generally: many articles in the press referred to a cancellation penalty of 10% which can be levied when a consumer cancels a contract early. Please be aware that this was documented in DRAFT Regulations and until the FINAL Regulations have been published the Act provides for a Reasonable Cancellation penalty. Until the Department of Trade and Industry has finalised the Regulation, Vodacom will continue to apply early contract termination charges as per the Terms and Conditions in our contract agreements. Should you get any queries from customers wanting to cancel their lines and insisting on the 10 % cancellation fee the following guidelines can be used to answer the customer: The act currently prescribes ‘a reasonable cancellation fee’. As per the Draft regulation the Minister intends to prescribe an amount. This prescribed amount needs to be regulated and this legislation is currently in the process of being reviewed for comments. Until such time as the legislation is approved, Vodacom will continue to charge ‘the reasonable cancellation fee’ under the existing terms and conditions on the contract.

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The point is that the cancellation fee has never been reasonable (i.e. paying the full balance of the remainder of the contract). So rather than taking some initiative from the draft regulations simply retain the status quo until legislation finally forces your hand. My guess is all the providers will be playing this card till the final act is published <sigh>.

Where did you get hold of this internal document minerva?

minerva said:

we need to listen and respond to their request in a fair and timeous manner.

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I have never heard of that word before in my life, let alone seen such application as an adjective.

OK, I lie, I have heard the word and have come to discover that it is South African - nowhere else in the world do they say this - timely being preferred.

ocleroux said:

Where did you get hold of this internal document minerva?

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Wikileaks

And they try to say that it's not just a mere logo change....

ocleroux said:

Where did you get hold of this internal document minerva?

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Oh no the Gestapo is on to me!

I thought documents like this are confidential within a company?

Oh well, now it's posted for the world to see.

LOL @ Wikileaks.

Reminds me of the time I wanted to downgrade a MTN contract. I was at the shop about 8 hours before the expiry date of the contract.
They wanted to charge me a R1000 penalty fee. So it seems this “criminal” behaviour will be continuing for a while

Lol. That was a Vodacom C2 classified email I'm guessing.so much for that.

heads are going to roll lol

morkhans said:

The point is that the cancellation fee has never been reasonable (i.e. paying the full balance of the remainder of the contract). So rather than taking some initiative from the draft regulations simply retain the status quo until legislation finally forces your hand. My guess is all the providers will be playing this card till the final act is published <sigh>.

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We have a Talk 500 contract that was being used on a switchboard, and which has been renewed several times. Now that the SIM is no longer required, we discover that we have 13 month remaining on the last 24 month contract renewal and Vodacom wants just over R10000 to cancel the contract!!! Never mind that we have dozens of other contracts, never mind that we have been repeat customers, renewing these contracts for up to 10yrs, never mind that this SIM is unused and therefore a complete waste, they want their R10000 or else. What w@nkers.

garp said:

We have a Talk 500 contract that was being used on a switchboard, and which has been renewed several times. Now that the SIM is no longer required, we discover that we have 13 month remaining on the last 24 month contract renewal and Vodacom wants just over R10000 to cancel the contract!!! Never mind that we have dozens of other contracts, never mind that we have been repeat customers, renewing these contracts for up to 10yrs, never mind that this SIM is unused and therefore a complete waste, they want their R10000 or else. What w@nkers.

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Suruely that is not a reasonable fee? Is it possible that the new contract came with a handset that cost 10k?

minerva said:

Suruely that is not a reasonable fee? Is it possible that the new contract came with a handset that cost 10k?

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Yes, can't remember what, but we're almost halfway through the contract now - would mean Vodacom thinks they're out of pocket approx R20000???