Two retailers run out of stock after confirming orders

December 28 2012 by Ellen Roseman

First, Staples Canada did it. Then, Newegg.ca did it. Many customers were disappointed and frustrated to see how their holiday gift orders were mishandled.

Both retailers advertised a special price and accepted credit card payments. Then, they waited several days before notifying customers that the stock was low and they wouldn’t get what they wanted.

I wrote about the Staples saga last week. That attracted a few responses from readers.

In tomorrow’s paper, I talk about Newegg’s nastiness, waiting until Dec. 27 (after Boxing Day) to notify customers that inventory had run out.

I’ve heard from a dozen unhappy Newegg buyers, hoping to get a 3D television set that never arrived. One man sold his old TV in anticipation. Now his wife and kids are yelling at him.

Both retailers offered a discount coupon to those hurt by their errors. But is this enough? Shouldn’t they be sure they have enough inventory before taking people’s money?

I think the Competition Bureau should look into these cases. If enough people complain about misleading advertising, the bureau will launch an investigation.

22 comments

  1. Don B

    Dec 28 2012

    Staples presents the issue of not shipping Apple TV as an “insufficient inventory” issue.

    However, the facts point more to a Resale Price Maintenance issue.

    For those not familiar with Resale Price Maintenance, it is when a manufacturer forces retailers to sell at a pre-determined price, penalizing the retailer if they offer significant discounts.

    Maybe you can dig a bit deeper to see if Staples shipped any of this item at the discounted price.

    Companies like Staples have very sophisticated inventory control and customer demand prediction software, so it is not credible that they ran out of inventory on the first day of the sale.

    Another giveaway is the fact that Staples was offering next-day delivery at the regular price the following day.

    The Staples statement that they were “working on a communications plan” also indicates a deeper issue than stock levels. Time for the Office of Consumer Affairs to investigate.

  2. FG

    Dec 28 2012

    My situation is similar to the ones you described.

    I went to the Staples store in Gerrard Square, Toronto, on Dec. 16th because I read Staples’ flyer advertising iPads at reduced prices.

    I bought a regular iPad for myself and wanted an iPad mini for my partner as a Christmas gift. There were none in the store, but I was promised one by the end of the week and I paid for it.

    Yesterday evening, I decided to go to the store to find out where my mini was. Well, they hadn’t received any minis and had no idea when they would be coming in.

    You can imagine how I felt. I’ve been a Staples customer for years. I’ve purchased computers there, at least 4 printers, cartridges, office furniture and all manner of office equipment and materials from them. I get emails from them every other day about their wonderful deals.

    I spoke to one of the managers, who was straightforward, telling me that he had no idea when a mini would come in and that I would get one when they did come in.

    Apple had had production problems with the screens, so they were behind filling their orders and stores had no option but to wait.

    I remember hearing something about this when the minis were released but thought this problem had been resolved.

    Apple was in a partnership with Staples and they told Staples to continue selling the iPads despite the fact that they had no stock. A cashier quietly told me the store hadn’t had minis in a really long time.

    I had seen a half page ad – not a tiny magnifying glass necessary ad. But Staples had no stock!

    There was nothing saying quantities were limited. There wasn’t a sign in the store saying that the iPads were sold out. There was absolutely no clue that there was anything wrong.

    Head Office must have known they didn’t have minis to sell, yet carried on as if that was ok.

    A “specialist” salesperson promised me I would receive the mini by the end of the week, in plenty of time for Christmas. I guess it’s my fault I didn’t ask Christmas of what year.

    If I had suspected there might be a delay, I would have gone elsewhere. I knew they were in demand. But I trusted what was promised by the Staples employee.

    This cost me 6 days and now I have no Mini for Christmas. The manager also reminded me that even the Apple store was having problems getting the mini. But the Apple store didn’t advertise a sale of the item.

    The manager was happy to refund my money. When I suggested some sort of compensation for the error and inconvenience, he flatly refused. I could wait or get my money back.

    Neither solution is particularly helpful. I wonder how a company is allowed to advertise products for sale that they don’t have without stating there will be a delay getting them.

    This kind of treatment of customers I would have expected from Future Shop, but not Staples. Even Best Buy said there were no minis in stock on their website. Not the case with Staples at the time of the sale.

    It appears that once again the individual consumer is of no consequence. I received, apologies, platitudes, but nothing else.

    I can tell you that Staples has lost me as a customer. I can’t accept being treated in such a cavalier manner.

  3. JD

    Dec 28 2012

    I recommend you browse through http://forums.redflagdeals.com/newegg-lg-42-led-1080p-120hz-3d-hdtv-2-sets-gaming-glasses-480-25-shipped-1276765/

    The company NewEgg did the same thing Staples did, taking our money for an entire week before telling us we weren’t getting what we already ordered.

    We all missed out on Boxing Day TV deals and still haven’t been refunded.

    I received and purchased 3D movies for my siblings that I now have no television to watch. And I have to tell my younger siblings that their Christmas presents must be returned.

    NewEgg has also been attempting to censor any public comments about this issue, deleting over 30+ posts off their Facebook page in the past 24 hours.

    Complaints have been made to the Better Business Bureau and the resellers rating. NewEgg has done literally nothing except copy and paste “We’re sorry for the inconvenience,” as if we were talking to robots.

    In the chat support, some customers have been told that the original deal would be honoured when new stock was received (having made an invisible notation on our accounts). Others have been told that this television has been discontinued from their stock altogether and no more units would be acquired.

    We weren’t told our orders were cancelled until after Boxing Day, so I missed out on any chances to acquire a different television and they’re still holding onto my $500.

    This has ruined Christmas for the 100s of people who were involved and NewEgg is trying to hide it, telling customers they are out of luck, providing no concrete answers about the situation.

  4. AB

    Dec 28 2012

    I got your email from a RedFlagDeals forum post.

    I’m sure by now that you’re aware of what’s happened with NewEgg.ca’s offer of a TV. They collected orders, charged credit cards and subsequently deleted orders and removed any trace of the transaction from their site.

    Their CSRs assured consumers that IF Newegg got the TV back in stock, they would honour the price. But the subsequent listing of the TV as “Discontinued” says all you need to know about Newegg’s intentions of getting more stock.

    Had Newegg done the right thing and promptly informed customers that the product was not in stock (and not collected payment), I don’t think they would be facing such a backlash.

    What they did was prevent people from shopping at other Boxing Day deals (or worse, encouraged them to make purchases to complement their purchase).

    I know I avoided other TV sales, thinking I had made my purchase. After all, I had paid for it.

    As of today, I still have a charge from Newegg on my credit card that prevents me from purchasing a different TV.

  5. BK

    Dec 28 2012

    On Dec. 21, Newegg.ca had a promotion on an LG 42 inch LED 3D TV, where there was an instant $200 savings on an already on sale price of $600, lowering the price to $400.

    I placed my order at 1:41 am EST on Dec. 22 (only a few hours after the deal was live).

    I got a confirmation that my order was placed, as well as a confirmation that my credit card was successfully charged.

    My order was changed to packaging (which meant items were being collected for shipping and I could NOT make any more changes).

    The TV was still labeled as in stock in the morning when I woke up (9 am) and only went out of stock a few hours later.

    On Dec. 27, people started to receive emails from Newegg.ca stating that the TV was back ordered.

    However, when we examined what actually happened, the order seemed to be cancelled and vanished from my order history – essentially as if it never existed.

    Newegg said that I would be issued a refund in 1-2 business days.

    Newegg CSR’s and management has given multiple, conflicting answers to consumers, basically saying that too many people ordered the TV and their inventory management system could not update in time.

    However, this doesn’t make sense, given the fact that it seems like almost everyone’s order got cancelled (hundreds, maybe even thousands) and the fact that it said the TV was in stock for so long.

    They also said it was on a first-come, first-serve basis. But based on comments at the Redflagdeals.com thread, people have been getting their 3D glasses and TVs who ordered after people whose orders were cancelled.

    (RFD thread is here: http://forums.redflagdeals.com/newegg-lg-42-led-1080p-120hz-3d-hdtv-2-sets-gaming-glasses-480-25-shipped-1276765/23/)

    Newegg management has decided that a $25 gift card is their final offer to people affected by this. I see this as completely unacceptable.

    They charged our credit cards immediately after the order. It took them 5 days later to even cancel the orders.

    Many people thought they had this TV already, since it was in packaging (and credit cards charged). As a result, they sold their existing TVs, bought items to complement the TV, and/or elected not to do shopping on Boxing Day for another TV since they got a deal.

    This is all now a sunk cost or opportunity cost, seeing as we have no TVs and no proper compensation for this error.

    As you can see, this situation is not being handled well at all by Newegg and no clear answer is being given and no proper compensation given the unique situation.

    Additionally, Newegg has deleted comments from individuals on their Facebook page with valid customer complaints.

    While they have every right to delete any comment, doing this is further showing that they are trying to sweep this under the rug and finish this.

  6. MM

    Dec 28 2012

    Thanks Ellen! I am one of the hundreds of customers who bought the TV from newegg.com as a Christmas gift for my parents.

    Once my credit card was charged, and the company notified me that my TV was “being prepared for shipment”, I went ahead and gave my parents a Christmas card which gave them the surprise that they would be receiving a TV as a Christmas present.

    Newegg turned that Christmas gift into a bitter experience when I had to call my parents yesterday to tell them that the company had cancelled the order for the TV almost a week after they charged my credit card!!!

    I missed out on the opportunity to buy a boxing day TV as a replacement. Boo newegg! They need to offer us a suitable replacement for this purchase. They can’t just charge us for merchandise that they have no intention of selling/shipping to us.

  7. BW

    Dec 28 2012

    I ordered the 42″ LG Tv and was charged like everyone else. Before I went out boxing day shopping for items that would complement the tv (that I thought I was getting), the status of my order was in the packing stage.

    Since it had been 4 days since I’d ordered the tv, I went out and purchased a number of items for the tv. The next day I log in onto the newegg site and it showed I had no order.

    I then contacted newegg’s customer service and they told me it was back ordered and that my order was cancelled and I would be receiving a refund 1-2 business days (I have just received another email stating that it would take 3-5 business day before I get a refund).

    They offered me $200 promo code that I used on the TV for the same one when it came back in stock. However, they had already raised the price of the tv $200 more from the sale price.

    After finding out what they did, I contacted a supervisor and he told me that they would probably not get any more of those tvs in and that they would honor the $200 promo code for the tv (that isn’t going to come back in stock) and a $25 gift card.

    It’s ridiculous that they would offer me something that I could not use. They refused to allow me to use the promo code on any other tv.

    Every customer service rep I’d talked to said the same thing, that upper management would only offer $25 and to be happy that they made the exception for me to use the $200 promo code on the TV that they will never get in again.

  8. ET

    Dec 28 2012

    Just wanted to say thanks for looking into this Ellen!

    Quite a few Canadians were affected by the Newegg Christmas Disaster. Passed on quite a few deals on Boxing Day because they already charged my credit card.

    It’s been over a week and they’ve just notified us that they will eventually be making a refund to us. Let’s all work together to get to the bottom of this!

  9. HS

    Dec 28 2012

    I bought a surround sound system, a tv mount bracket and a media box for this damn 42″ TV that never came!

    Many anticipated shipment and delivery of the TV, and many were disappointed and frustrated when they received this “backordered” email notification. Such a waste of time and money, and during this festive holiday week, no less!

    This was very poorly handled by newegg, before and after the TV sold out. And I know they have an accurate and up to date inventory system (considering the constant live deals and promos of the computer parts they sell).

    Newegg can’t just ignore what they did and pray people will forget, they need to be held accountable for such ugly and unlawful business practice. United we stand, voices be heard, justice be served! Or something…

  10. ZS

    Dec 28 2012

    Hi Ellen, and thanks for fighting the good fight – this time against Newegg.ca – the GRINCH that stole Christmas in 2012.

    I learned about your upcoming article through Redflagdeals and am amongst the chosen few that got caught in the intersection of both the Staples and Newegg.ca Venn diagrams.

    I had placed a Staples order for an Apple TV (never fulfilled) and also placed an order with Newegg.ca for the LG 42″ television only to have Newegg.ca charge my credit card, hold on to it for 5 days and then cancel all the orders – conveniently after Boxing Day all but ensuring I couldn’t hunt or queue up for similar promotions that other retailers were offering!

    I called up their customer “service” line to complain but clearly wasn’t loud enough as NO COMPENSATION was offered.

    Instead the representative argued that the order was never in “packaging” state, as stated on my account page that said the order was passed the verification stage and items were being collected for shipment.

    (Juicy sidenote- they conveniently deleted any trace of my order from my order summary page on their website as if the last few days never even existed!)

    The representative didn’t even ATTEMPT to “make it right” for those they had clearly wronged, especially at this time of the year.

    I am utterly disgusted by their shady and misleading business practices and am delighted to hear that you will be shining the light on this so they can publicly explain themselves. I, along with hundreds of other dissatified customers, will be eagerly awaiting their response.

  11. Magster

    Dec 28 2012

    Thanks for writing about this Ellen. I too am one of the people who ordered the not in stock TV.

    I can understand if an item sells out but to send an e-mail to say that it is “backordered” and then without warning just delete the order out of the account as if the order never existed to me means they didn’t have any intention of bringing in more stock.

    If that’s the case, then why not be upfront about it rather than using such suspect tactics? Not impressed at how Newegg has handled this.

    Only now that the complaints are escalating and you’re writing an article that they are offering vague promises of resolving this.

  12. AY

    Dec 28 2012

    Thanks for looking into this Ellen!

    I was hoping a new TV would be a nice xmas surprise for the family, but despite charging my credit card, and packaging claim by newegg my order was cancelled. I was also unable to take advantage of other deals.

    Newegg handled the situation very poorly and the email stating product was on “back order” is false as it was just a cancellation email. In addition they removed my order history, which makes it seem like I haven’t ordered it at all.

    Very shady business in my books, hopefully they will resolve it by sending out the TVs or giving an equivalent discount on a comparable model (66% off).

    As of right now i won’t be a repeat customer. Perhaps their solution will change my mind but I will still try to steer clear.

  13. Dave

    Dec 28 2012

    Thanks for taking the time Ellen to write about this situation at Newegg…. I was a buyer of this tv and went through the exact same as the people who wrote here before me… I think the most irritating part was the total lack of concern by customer service.

  14. Gary

    Dec 28 2012

    I haven’t given up on Newegg. I think they will redeem themselves.

  15. TL

    Dec 28 2012

    Thank you, Ellen.

    I bought the TV too from NewEgg and got cancelled after 5 days. They deleted my order in their system as well. I talked to the CS rep yesterday evening and was offered $25 store credit. I rejected the offer and complained the offer is not reasonable cosidering I lost the opportinity to shop for other deals. However I was told the offer is final.

    I think the sad thing is NewEgg only starts to show the attitude of solving the issue once media has been involved. If it were myself alone, I would not be able to even to get this far.From this point, they deserve it.

    Thanks again for your wonderful work!!!

  16. CJ

    Dec 28 2012

    I’m not saying it’s right, but it’s a little funny that the man says his family is yelling at him because they don’t have a tv. Imagine it, they might have to talk to each other or something! It’s the end of the world!

    Bad business practice, yes, but that family might want to re-evaluate their priorities.

  17. Michael

    Dec 28 2012

    Some customers received the following offer from Newegg via email this evening, however I did not receive such an email.. Hopefully NE will offer me the 3d TV option so I can watch the 3d blu-ray movies I bought.

    For those who got the email, options are:

    A) The Original: LG 42” LCD 3D TV – Final Product Sale Price $400
    You may complete the purchase of one of the original TVs we’ve been able to secure at the original discounted price.

    B) Comparable: at a reduced Cost: LG 42” LCD TV – Sale Price $349.99
    http://www.newegg.ca/Product/Product…=89-005-303CVF EARN CASH BACK
    You may purchase a different model of an LG 42” LCD TV. This product does not have the 3D capability of the original product, but Newegg is offering it only to you at this deeply discounted price to offset the difference.

    C) No TV: $100 Newegg Gift Card
    In the event you do not prefer either option, as a gesture of apology and to express our sincerest gratitude for your understanding, Newegg would like to offer you a $100 Newegg Gift Card that may be used on any order in the future. There is no expiration date.

  18. RC

    Dec 28 2012

    thanks for writing about it. I too, this was suppose to be my first HDTV. And I was so excited that i even purchased the accessories (android key) for this “non-existing” tv.

    The most annoying part to me was that they didn’t announce cancellation after the boxing day weekend where i can still attempt to snag a HDTV from another supplier.

  19. osman

    Dec 28 2012

    Hi Ellen, thank you for standing up for the little guy and publishing these stories!

    I too am one of the customers affected by the New Egg LCD TV fiasco.

    as others have mentioned, SOME customers have been contacted with options, but there are still a lot of us who have not heard back from New Egg.

    Thank you for writing and helping to hold a company accountable!

  20. PT

    Dec 28 2012

    I would like to thank you for writing about this. This was my first encounter with an issue like this and looks like a resolution was made.

    I have made purchases from NewEgg in the past and would like to continue doing business with them. Never noticed they charged my credit cards prior to order fulfillment until now.

    I am not a fan of this, and I hope they improve their business practices.

  21. Cs

    Dec 30 2012

    I dit not receive my TV… Dit not receive an offer…. Now my money is on “temporary hold” by Paypal… Have an happy new year!

  22. Sandip

    Feb 26 2013

    I bought a laptop through Lenovo and got confirmation email. After 20 days, I got money back with no notification whatsoever.

    This is crazy! Last December, I bought from Dell.ca and exactly the same thing.

    This time, I fought back and they shipped wrong laptop. Again fought back and got partial credit. We as consumers need better control over these companies.

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