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Debacle at Dell After Customers Buy PCs for Pounds 3.64

Posted on: Sunday, 28 August 2005, 09:00 CDT

Dell is facing a Hoover-style fiasco after its UK website appeared to allow hundreds of customers to buy desktop computers for as little as pounds 3.64.

An error in the ordering system on the Dimension 5100 PC meant that anyone ordering any extras " such as greater memory or flat- screen monitors " had the price of the add-on deducted from the original cost of the computer. This meant that a PC usually costing pounds 401 could be bought for as little as pounds 3.64, including VAT and delivery.

The error was first noticed by customers at 4:30pm on Monday and was not picked up by Dell until Tuesday morning. It then closed the website while it sorted out the problem.

In the meantime, hundreds of people ordered Dimension 5100 PCs at the bargain price. One small business bought 100 PCs while another customer purchased 1,000.

All were sent electronic confirmations of their purchases. However, the written confirmations, which guarantee shipping of the PCs, were not sent out to many purchasers, raising speculation that the company may try to cancel the transactions.

By Friday, Dell was sending notices to some customers saying it would not honour the deals.

A statement from Dell indicated that many customers would end up being disappointed: 'In accordance with the model operated by many online stores, regarding how and when a contract is formed, our Terms and Conditions of sale say that orders are only binding when confirmed by Dell in a written order confirmation. We will be honouring this offer to any customers who received an order confirmation from Dell. For those customers who attempted to submit orders and received an order acknowledgement but who did not receive an order confirmation, the corrected price stands.'

According to Which?, the consumer association, Dell is within its rights. 'When there is clearly a mistake on a website, then the seller does not have to honour the transaction,' said Joanne Barker, a legal adviser at Which?.

However, customers contacted by The Independent on Sunday were unhappy with this stance. 'Dell is a big company, which should stand by the prices it quotes,' said Martin Malcolm, who had bought one of the pounds 3.64 computers and then had the deal cancelled. 'This reminds me of the Hoover fiasco.'

In the Hoover case, the vacuum cleaner maker offered free flights with each appliance sold. However, the value of the flights was more than some Hoovers, leading to people buying lots of vacuum cleaners and the company incurring massive losses.

Dell has recently seen its shares tumble after poor sales in the US, which it blamed on overly aggressive discounting.

Source: Independent on Sunday, The

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