Selling directly to consumers as a manufacturer or importer

Manufacturer and importer responsibilities

A manufacturer is a person or business that:

• makes or puts goods together
• has their name on the goods.

The importer is responsible for consumer guarantees on goods if the maker doesn’t have a place of business in Australia.

Along with the supplier, as an importer or manufacturer, you will ensure that goods will meet the following guarantees that the goods:

• are of acceptable quality, that they will be safe, durable and free from defects. They will be acceptable in appearance and finish and do the job such things are usually used for
• are reasonably fit for any disclosed purpose and for any purpose for which the supplier represents that they are reasonably fit
• match the description given to the consumer
• match the sample or demonstration model.

The guarantee also includes:

• repairs
• spare parts.

When you sell goods directly to the consumer

As a manufacturer or importer, you may sell goods directly to consumers for example, via an online store. You are acting as a supplier and have the same responsibilities under consumer guarantees law.

Consumer claims against the manufacturer

If a consumer has purchased goods from a supplier but is making a claim against the manufacturer, they can ask for an amount covering any drop in the value of the goods.

This is calculated using the average retail price of the goods at the time of purchase.

The consumer can also ask for compensation for any reasonably foreseeable loss suffered due to the manufacturer’s failure to meet the consumer guarantees. Reasonably foreseeable costs include the cost of inspecting and returning the goods to the manufacturer.

If you did not cause the problem

As a manufacturer, you’re not responsible for problems with goods beyond your control. You do not have to pay damages if goods do not meet the consumer guarantees due to:

• an act, default, omission or representation made by some other person, unless they are your employee or agent
• a cause independent of human control that occurs after the goods left your control
• the supplier charging a higher price than the recommended or average retail price for the goods, but you will be held to the standard required if the goods were sold at the recommended retail price or the average retail price.

Limits on compensation

As a manufacturer, you can limit your liability under the consumer guarantees for problems with goods or services not used for personal, domestic or household purposes. You can limit remedies to:

• replacing or repairing goods
• reimbursing the consumer for repairing or replacing the goods
• re-supplying services
• reimbursing the consumer for paying someone else to supply the services.

You can only do this if it’s fair or reasonable. What is fair and reasonable will depend on the circumstances, including whether the:

• consumer had no choice but to agree to limit compensation
• consumer was given something in return for buying the goods or services from you, at the expense of buying from someone else
• consumer knew or should have known about the limit on compensation
• goods were a special order for the consumer.

When a supplier deals with a manufacturer’s problem

You must reimburse a supplier who deals with a problem that is your responsibility under the consumer guarantees.

The amount can include any compensation paid to the consumer for consequential losses.

Suppliers must make a request within 3 years

A supplier must make a request within three years of the date the:

• supplier fixed any problems with the consumer’s goods, or
• consumer took legal action against the supplier.

Other limits on reimbursement

You cannot contract out your obligation to reimburse the supplier.

A manufacturer can only limit their liability to a seller if goods are not of a kind ordinarily acquired for:

• personal
• domestic, or
• household use or consumption.

It is under these circumstances that a manufacturer can limit their liability to the lowest cost out of:

• replacing the goods
• obtaining equivalent goods, or
• repairing the goods.