05 April 2014
Consumer is considered as the most powerful motivating force and also the purpose of production. At the same time consumer is equally liable to higher penalties segment of the whole marketing system. There were attempts to safe guard the interest of the consumer in a sporadic (occasional) way till 1986 until the Government of India enacted a comprehensive legislation-Consumer Protection Act. The act applies to all the goods and services excluding goods for resale or for commercial purpose and services rendered free of charge and under a contract for personal service. The provisions of the Act are compensatory in nature. It covers public, private, joint and cooperative sectors.
Consumer Protection Councils are established at the national, state and district level to increase consumer awareness.
The main reasons for the need for consumer protection in India can be explained as follows:
1. Illiteracy and Ignorance:
Consumers in India are mostly illiterate and ignorant. They do not understand their rights. A system is required to protect them from unscrupulous businessmen.
Eg. Illiterate people in India often buy Nokai mobile phones considering it as nokia brand.
2. Unorganized Consumers:
In India consumers are widely dispersed and are not united. They are at the mercy of businessmen. On the other hand, producers and traders are organized and powerful.
Eg. Consumers in India often agree to buy substitute products which are relatively cheaper than the standard products. Tooth brush which are not branded but cheaper are introduced to consumers possessing low purchasing power.
3. Spurious Goods:
There is increasing supply of duplicate products. It is very difficult for an ordinary consumer to distinguish between a genuine product and its imitation. It is necessary to protect consumers from such exploitation by ensuring compliance with prescribed norms of quality and safety.
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