HE 2800 – Consumer Education
Prepared by: Teresita G. Rodriguez
E-mail Address:
[email protected] Central Luzon State University
Science City of Muñoz 3120
Nueva Ecija, Philippines
Instructional Module for the Course
HE 2800: Consumer Education
Module 16
Lesson 1: Branding, Packaging and Labelling
In recent decades pre-packed commodities have received considerable importance
because of the ease and convenience with which they can be transported and marketed.
The technological improvements in manufacture, preservation and packing as well as the
changing trends in shopping practices are bringing more and more items for sale in ~
packaged form. These developments are at times encouraged as it is felt that they are
convenient to consumers. The consumers also prefer to buy packed goods because of
attractive presentation, ease in handling and facility in selecting the commodity of the
desired quantity, quality and price. However, as weighing or measuring in the presence
of the purchaser is not possible in the case of pre-packed goods, special legal provisions
are provided to protect the consumer. In this context, the consumer to protect himself /
herself from sales gimmicks should possess basic knowledge regarding packaging,
labelling and branding. At the time of making a purchase, the consumer shall look for the
characteristics such as safety, hygiene, environmental friendliness, quality and so on. The
consumer, for want of time, money and interest, would like to minimize the risks. The
consumer would seek effective means to recognize the difference between the goods
before selection. Therefore, the trader promotes his product to maintain a corporate
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imagen the eyes of the consumer with ‘brand’, a vehicle of ‘packaging’ to carry the
product safely through various stages of delivery. The trader gives an ‘identity’ to the
product through its description in the form of labels.
Objectives
The study of this module would enable the students to:
1. understand “brand name” “label” and “packaging”;
2. identify counterfeit products;
3. purchase the commodities carefully; and
4. educate fellow consumers on false goods.
Definitions:
Brand Name
Brand name is a name, sign, symbol or design or a combination of them intended
to identify the goods or services of seller or group of sellers and to differentiate them
from those of others. The brand name helps the consumer to identify the product, to
compare the products of similar nature, and to assess the quality of the product and so
on. ‘Cadbury’ for chocolates, ‘Fibisco’ for biscuits, ‘Rebisco’, ‘Cream O’ and so on.
Label
Label is defined as a display of written, printed or graphic matter on the container
or the package of the container. It is a simple tag attached to the product that carries
the brand name. A great deal of information or an elaborately designed graphic is part of
the package. A good label helps the consumer make a correct decision.
Package
A package is a wrapper or container in which a product is enclosed, encased or
sealed. Packaging, therefore, includes the activities of designing and producing the
container or a wrapper of the product.
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Trade Mark
A trade mark is a legalized version of a brand. In other words, a trade mark is a
brand that is legally protected. A trade mark is defined as “A brand or a part of a brand
that is given legal protection because it is capable of exclusive appropriation”. All
trademarks are brands and include both the brand name and the pictorial design.
Pre-Packed Goods and Unfair Trade Practices
The production and sale of goods in pre-packed form are likely to give rise to some
forms of sales gimmicks. Some of the common unfair trade practices in the case of pre-
packed goods are:
• Insufficient information on the label about the contents of the package
• Deceptive packaging
• Misleading slogans to describe package size Underfilling
• Confusion creation in unit price calculations
• Reduction in the quantity of package
• Over-charging on declared sale price
Laws On Pre-Packed Commodities
The laws in relation to pre-packed commodities are designed to curb the unfair
trade practices. Standards of Weights and Measures Act, 1976 contains provisions for the
regulation of pre-packed commodities.
Declarations to be Made on a Label
Every package should bear a label securely affixed. It should contain:
a) the name and address of the manufacturer or where the manufacturer is not the
packer, the name and address of the manufacturer and packer
b) the common or generic names of the commodity contained in the package
c) the net quantity, in terms of the standard unit of weight or measure of the
commodity contained in the package or where the commodity is packed or sold by
number, the number of the commodity contained in the package
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d) the month and year in which the commodity is manufactured or pre-packed
e) batch number is to be indicated
f) the retail sale price of the package
g) picture of the product, accurate as to size, color and appearance
h) description of raw products used along with method of processing
i) directions for use including caution against misuse
j) possible adverse effects, if any
k) directions on ideal storage conditions
I) brand name
Lesson 2: Product Testing and Safety Standards
The market place today is flooded with consumer goods and the consumers are
in a state of confusion over choice, the appropriate choice for money’s worth. The range
of products presented to the consumer are varied, exciting and overwhelming. Hence,
the consumers are not able to understand what to expect from the product or what is
expected from them as end-users. It is becoming difficult for the consumers to assess
the product quality, safety or value at the point of purchase and are much more bothered
as product safety is more important for the consumer as it is they who ultimately pay for
safety improvements, in terms of both money and related effects. In such a situation
product testing and product standards aid in making a proper choice.
Objectives
The study of this module would enable the students to:
1. understand the need for product safety;
2. learn the importance of product testing to aid in product safety; and
3. recognize and understand the different types of product standards.
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Product Testing
Product testing is an activity that seeks to measure the attributes of a product and
determine its performance, safety, quality and its compliance with established standards.
When consumers choose a product, they test the product for acceptance. This
shows the consumer’s personal preferences regarding the product over other comparable
products. They will not be measuring its safety and quality attributes that have a
significant impact on the safety and use. The public awareness of the hazards from every
day products are increasing. Injuries and/or death due to the product use have a number
of causal factors. Some products have built-in hazards, such as knives that cut, motor
vehicles that crash, matches that burn etc. Other consumer products have hazards that
are not so apparent, perhaps hidden. For example, it is almost impossible for consumers
to Know that the equipment or products were defectively manufactured.
Product testing by the manufacturer helps in designing, developing and selling
safe products. Two aspects of safety that need to be tested at the place of manufacture
are:
1. Reducing the incidence of injuries by preventing them from occurring in the first
place.
2. Reducing the severity of injuries when they do occur.
The test results and preventive measures should be indicated and publicized along
with the products. The consumers also have a responsibility in product testing for safety.
Consumer Responsibilities
➢ Examine the products for safety features before buying
➢ Question sellers about the safety features or attributes of the product before buying
➢ Carefully read product labels and literature and warning labels
➢ Use products as intended and with reasonable caution and care
➢ Assume personal responsibility for normal precaution when using a product
➢ Inform the suitable agency when a product does not perform safely
➢ Identify possible defects and report them to the proper agency
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➢ Support efforts to improve safety for all consumers Specifications and performance
standards also help in product safety.
Product Standards
Product standards produce significant social benefits by aiding information flow,
hastening technology transfer and promoting efficiency in production and safety.
Standards are technical prescriptions for material production, design, installation, safety
or performance characteristics of products. They are developed through organisations
that bring together persons of knowledge who prescribe the standards.
Types Of Product Standards
Several types of standards are recognized. Standard specifications prescribe use
of particular materials, designs, production processes, performance levels and test
methods.
Specification Standards
These are qualitative and quantitative measures of comparison that specify
technically and precisely how something will function. Sizes of blades, specific
metals/plastics, certain glades and weights etc.
Performance Standards
These are quantitative and qualitative measures of comparison that specify the
criteria in terms of outputs of objectively measured units such as content, strength,
power consumption, motor rating and other performance characteristics. Sellers tend
to prefer performance standards over specification standards because they are less
restrictive and they encourage competitive and efficient designs.
These standards can ‘be absolute standards, when if the product does not meet
the requirements, it cannot be sold on conditional standard, which is a qualified
statement allowing for contingencies, when certain conditions exist regarding the user
of the product or its application.
A variety of other terms are commonly used in reference to standards. For
instance, standards that address produce safety may be referred to simply as safety
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standards. Design standards generally state requirements in terms of various input
factors while performance standards address output requirements relating to actual
product use. Standards adopted by Government authorities for regulatory purposes
are called mandatory standards while private sector standards are referred to as
voluntary standards.
Thus, standards promote efficient individual consumption decisions when they
provide accurate information about the suitability of products for specific needs.
Standards also promote safety, thereby reducing risks of injury to health and property
as they promote an acceptable level of product safety.
Lesson 3: Weights and Measures
“Weight and Measure” means a weight or a measure specified under the Standards
of Weights and Measures Act, 1976. “Weighing or Measuring Instrument” means any
object, instrument, apparatus, device or any combination which is used for the purpose
of making any weighment or measurement and includes any appliance, accessory or part
associated with any such object, instrument, apparatus or device. There are different
kinds of weights and measures, weighing and measuring instruments used by the traders,
dealers of Trade and Commerce. One of the important reforms undertaken in the country
after Independence was the standardization of the system in weights and measures.
Uniform standards of weights and measures based on the metric system were established
in the country under the Standards of Weights and Measures Act, 1976.
Objectives
After exposing to the topic, the students should understand:
1. what are standard weights and measures
2. government efforts in ensuring correct weights and measures
3. role of consumers in safeguarding their interest
REGULATION OF PRACTICES RELATIVE TO WEIGHTS AND MEASURES
GENERAL PROVISION (excerpt from Republic Act No. 7394)
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Article 61. Implementing Agency. – The provincial, city, or municipal treasurers shall
strictly enforce the provisions of this Chapter, and its implementing rules and regulations:
Provided, That, with respect to the use of the Metric System, it shall be enforced by the
Department of Trade and Industry.
Article 62. Sealing and Testing of Instruments of Weights and Measure. – All
instruments for determining weights and measures in all consumer and consumer related
transactions shall be tested, calibrated and sealed every six (6) months by the official
sealer who shall be the provincial or city or municipal treasurer or his authorized
representative upon payment of fees required under existing law: Provided, That all
instruments of weights and measures shall continuously be inspected for compliance with
the provisions of this Chapter.
Article 63. Use of Metric System. – The system of weights and measures to be used
for all products, commodities, materials, utilities, services and commercial transactions,
in all contracts, deeds and other official and legal instruments and documents shall be
the metric system, in accordance with existing laws and their implementing rules and
regulations. The Department of Trade and Industry shall also adopt standard
measurement for garments, shoes and other similar consumer products.
PROHIBITED ACTS
Article 64. Fraudulent Practices Relative to Weights and Measures. – The
following acts relating to weights and measures are prohibited:
a) for any person other than the official sealer or his duly authorized representative
to place or attach an official tag, seal, sticker, mark, stamp, brand or other
characteristic sign used to indicate that such instrument of weight and measure has
officially been tested, calibrated, sealed or inspected;
b) for any person to imitate any seal, sticker, mark, stamp, brand, tag or other
characteristic sign used to indicate that such instrument of weight or measures has
been officially tested, calibrated, sealed or inspected;
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c) for any person other than the official sealer or his duly authorized representative
to alter in any way the certificate or receipt given by the official sealer or his duly
authorized representative as an acknowledgment that the instrument for determining
weight or measure has been fully tested, calibrated, sealed or inspected;
d) for any person to make or knowingly sell or use any false or counterfeit seal, sticker,
brand, stamp, tag, certificate or license or any dye for printing or making the same or
any characteristic sign used to indicate that such instrument of weight or measure
has been officially tested, calibrated, sealed or inspected;
e) for any person other than the official sealer or his duly authorized representative
to alter the written or printed figures, letters or symbols on any official seal, sticker,
receipt, stamp, tag, certificate or license used or issued;
f) for any person to use or reuse any restored, altered, expired, damaged stamp, tag
certificate or license for the purpose of making it appear that the instrument of weight
of measure has been tested, calibrated, sealed or inspected;
g) for any person engaged in the buying and selling of consumer products or of
furnishing services the value of which is estimated by weight or measure to possess,
use or maintain with intention to use any scale, balance, weight or measure that has
not been sealed or if previously sealed, the license therefor has expired and has not
been renewed in due time;
h) for any person to fraudulently alter any scale, balance, weight, or measure after it
is officially sealed;
i) for any person to knowingly use any false scale, balance, weight or measure,
whether sealed or not;
j) for any person to fraudulently give short weight or measure in the making of a
scale;
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k) for any person, assuming to determine truly the weight or measure of any article
bought or sold by weight or measure, to fraudulently misrepresent the weight or
measure thereof; or
l) for any person to procure the commission of any such offense abovementioned by
another. Instruments officially sealed at some previous time which have remained
unaltered and accurate and the seal or tag officially affixed thereto remains intact and
in the same position and condition in which it was placed by the official sealer or his
duly authorized representative shall, if presented for sealing, be sealed promptly on
demand by the official sealer or his authorized representative without penalty except
a surcharge fixed by law or regulation.
Article 65. Penalties.
a) Any person who shall violate the provisions of paragraphs (a) to (f) and paragraph (l)
of Article 64 or its implementing rules and regulations shall, upon conviction, be subject
to a fine of not less than two hundred pesos (P200.00) but not more than One thousand
pesos (P1,000.00) or by imprisonment of not more than one (1) year or both upon the
discretion of the court.
b) Any person who shall violate the provisions of paragraph (g) of Article 64 for the first
time shall be subject to a fine of not less than Five hundred pesos (P500.00) or by
imprisonment of not less than one (1) month but not more than five (5) years or both,
upon the discretion of the court. c) The owner-possessor or user of instrument of weights
and measure enumerated in paragraphs (h) to (k) of Article 64 shall, upon conviction, be
subject to a fine of not less than three hundred pesos (P300.00) or imprisonment not
exceeding one (1) year, or both, upon the discretion of the court.
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Lesson 4: Guarantee and Warranty
A consumer gets a product in exchange of his money. What happens in the market
is, a consumer who desires to purchase a product enters into the market with money.
The product is available with the seller. The seller fixes the price for the product and
offers for sale. When the consumer wants to purchase the product, he is liable to pay the
price of the product to the seller. The seller who offered the product for sale is ready to
sell the product when he receives the price of the product as fixed by him. In this course
of action, there is an agreement between the consumer and the seller. The seller is ready
to transfer the product if he gets the money in return, similarly the consumer is ready to
transfer the money and agrees to pay as per the price fixed by the seller in exchange of
a product. Therefore, buying of goods and services is an agreement or a contract to get
something in exchange for payment of money. All the principles of a legal and valid
contract apply to any sale of goods or services. Any sale of goods or services must be
between two legally competent persons for a consideration (money) who agree to do so
freely, without any coercion. When a sale is made, the principles of contract apply to all
sales, damages for breaking any agreement to sell or for supply of defective goods or
services are decided according to the Consumer Act.
A “Guarantee” or “contract for guarantee” arises under the Contract Act. A
consumer gets a guarantee for the product he purchased. A guarantee is a promise made
by the seller on behalf of a manufacturer most of the times. Consumer and seller enters
in to a contract. Sales and purchases of goods is covered under Sale of Goods Act. The
Act provides that all sales of goods and purchases by consumers are covered by certain
basic standards of safety and quality. When sale of goods takes place, the consumer is
assured of quality of the product. The sale of goods takes place under certain conditions
and warranties. These conditions and warranties are offered by the manufacturer or seller
to make the product more competitive. The manufacturer or seller is bound to agree the
terms and conditions specified in the warranty. The two terms ‘guarantee’ and ‘warranty’
are commonly used in the market. “Guarantee” or “Contract for guarantee” is covered
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under the Contract Act. The Conditions and Warranties are covered under the Sales of
Goods Act.
After study of this lesson, would enable the students to:
1. make the students understand guarantee and warrantee; and
2. make the students realize, how careful the consumer should be to claim guarantee
and warrantee and protect his interests.
Meaning and Definitions
Guarantee
Guarantee is a contract to perform a promise or discharge the liability of a third
person in case he fails to do so.
The person who gives the guarantee is called “Surety”. The person in respect of
whose default the guarantee is given is called the “principal debtor” and the person to
whom the guarantee is given is called the ‘creditor’.
A guarantee may be oral or written. Anything done, or any promise made, for the
benefit of the principal debtor may be a sufficient consideration to the surety for giving
the guarantee.
Condition
A condition is a stipulation essential to the main purpose of the contract, the breach
of which gives rise to a right to treat the contract as repudiated.
Warranty
A warranty is a stipulated collateral to the main purpose of the contract, the breach
of which gives rise to a claim for damage, but not be a right to reject the goods and treat
the contract repudiated.
A breach of condition gives the aggrieved party a right to sue for damages as well
as the right to repudiate the contract. A breach of warranty gives only the right to sue
for damages. The contract cannot be repudiated.
Warrantees are designed to protect the consumer in the event of a product failure
or malfunction while guarantees are given for the durability in terms of a period.
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Warrantees can be implied or written. Implied warrantees are related to the fitness of
the good, written warrantees are offered by the manufacturer or seller to make the
product more competitive, and are in addition to the implied conditions and warranties.
General Principles
i. A consumer should carefully examine guarantee, warranty and terms of conditions. a
guarantee must disclose clearly and conspicuously the nature and extent of the
guarantee
ii. What product or part of the product is guaranteed
iii. What characteristics or properties of the designated product or part thereof are
covered or excluded from the guarantee
iv. The duration of the guarantee must be clear
v. The obligations of the claimant under the guarantee should be specified
vi. The obligations of the guarantor whether he will repair, refund or replace should be
clarified
vii. The identity of guarantor must be clearly set out because the guarantor can be a seller
or a manufacturer
viii. The duration of the guarantee should be specified
ix. In case of warranty, it must be stated full or partial
A full warranty implies that the seller or manufacturer undertakes to repair or
replace any defect in the product free of charge within the time specified in the warranty.
A “service contract” can be sold by the seller or manufacturer in addition to a warranty.
But it cannot be imposed upon or tied up with the warranty.
Cheating a Consumer
It is a common practice cheating the consumer in laying down conditions of
guarantee and warranty. Usually, the terms and conditions are printed in small font and
in a language which is not common and colloquial. The seller is required to sign on
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guarantee or warrantee card with his official seal. As the consumer is not aware of this,
the seller often misleads him.
Consumer Responsibilities
The consumer should be more careful. He should:
a. clearly read the terms and conditions
b. get clarifications regarding conditions not understood
c. know the duration of guarantee
d. know the conditions of warranty
e. know full and partial promises
f. know how to claim in case the need arises
g. see whether the warranty bears the signature, date and seal of warrantor.
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