DirectBuy - is it a Ticket to the House of Style or the Poorhouse?

The infomercial

I don't generally make a habit of watching infomercials. I did happen to catch one yesterday, though, having awakened early. Like most other infomercials I've seen, on the one I saw yesterday, there were lots of people giving glowing testimonials about the product being pitched. My eyes zeroed in on the screen, where a middle aged couple was standing in what looked like a beautiful living room. Although the living room was impressive, the people were rather plainly dressed. The man was wearing jeans and a flannel shirt. The rather well-endowed woman was wearing a t-shirt that was a little too tight for her and old, faded jeans. They were talking about how much money they had saved furnishing their living room through DirectBuy.

Intrigued, I kept watching as another woman described how she had remodeled and furnished her home at a great bargain, thanks to DirectBuy. The camera panned around her patio, which was decked out with fancy looking outdoor furnishings. I could see a body of water in the background, suggesting that this lady lived in a nice neighborhood. Then the camera showed her dining room, where the lady showed off a lovely table set with fine china and crystal and surrounded by beautiful chairs.

A chirpy blonde woman with perfect white teeth suddenly appeared on the screen. She explained that DirectBuy is a club that allows ordinary people like you and me to buy furniture, building materials, and household goods and luxury items at wholesale prices. The spokeswoman kept her voice light and dynamic. She sounded friendly and energetic and smiled a lot, showing off those gorgeous teeth that probably cost her a fortune. No doubt about it, I was interested in what she had to say even though I had no desire to join the club, because as I was watching the infomercial, it suddenly occurred to me why the scheme seemed so familiar.

The first time I heard of DirectBuy, formerly known as United Consumers Club...

Back in August 1994, I was a brand new college graduate with a B.A. in English. I was eager to find my first full time job and start earning a living. I was still living at home with my parents, who were equally ready for me to get out and on my own. My mom in particular was really laying on the pressure for me to fly the coop, so I looked for job opportunities wherever I could find them. I found a newspaper advertisement for a "public relations" job that paid $22,000 a year. No, that's not a lot of money, but remember, it was 12 years ago and I was a fresh college graduate who wanted a job... any job. So I called the number in the ad to find out more about the available "public relations" position.

It turned out the job was for United Consumers Club location in Richmond, Virginia. Back in 1994, I had never heard of United Consumers Club, which was later renamed DirectBuy. The man I spoke to didn't give me a lot of details about the job and what he was looking for in a candidate. He just told me to show up at 9:00am the next morning for an interview to see if "we liked each other". In retrospect, his choice of words probably should have been my first clue that I wasn't going to enjoy the interview. Nevertheless, it was a job interview and I wanted a job. And as it turned out, I had set up another interview in Richmond for later that day. My parents would be pleased to see that I at least had a couple of prospects. I agreed to meet the guy and went shopping for a new suit.

The next day, I arrived at the address the man on the phone had given me. I was bright and early and feeling confident dressed in my new suit. I was a little suspicious when I saw that I was in a strip mall, but I walked into the establishment, where I was promptly met by the proprietor. He looked at his watch and noted that I was about fifteen minutes early. He asked me to leave, suggesting that I get some coffee and come back at exactly the appointed hour. Once again, I was a bit taken aback, but I had driven a long way for the interview. I sat in my car and waited fifteen minutes.

When I came back at 9:00am, I found that I was not the only one who was going to be interviewed. A large crowd of people sat in the waiting room, resumes in hand. The proprietor asked me to fill out a standard job application. It was the kind of application one might find at any business. Then the proprietor escorted us all to a room and asked us to sit at a big table. I noticed a TV stationed where we could all see it. There were whiteboards everywhere, where the proprietor would eventually make some notes as he explained the concept of his business.

The proprietor showed us a video about United Consumers Club that was much like the infomercial I recently saw about DirectBuy. The video featured a number of couples who were thrilled with their decision to join United Consumers Club. They all spoke enthusiastically about all the great furniture they were able to purchase at a fraction of the retail cost. I started to become suspicious. Apparently, so did some of the other job applicants. A couple of them left before the video was finished. I had driven too far to just leave and I had another interview scheduled for later in the day, so I stuck around if only just to kill time. In retrospect, perhaps I should have left with the others who walked out during the video.

When the video was finished, the proprietor stood up and delivered what appeared to be his standard business presentation. He and his wife were the franchise owners of that particular United Consumers Club location. They were looking for someone to attend presentations and try to get people to sign up for the club. The guy started telling us about some of the tactics they used to get people to pay for memberships, explaining that when people attend the presentations, they have to decide right then and there whether or not they want to join the club. If the prospective members don't want to join that day, they are escorted out of the building and told that they can't join even if they show up the next day with the membership fee, ready to pay in full. I don't recall how much the memberships cost back in 1994, but I do remember thinking that they were expensive. And according to my research, DirectBuy now charges roughly five thousand dollars for a three year membership, then subsequent years cost a couple of hundred dollars a year. Those who don't pay in a lump sum can finance the cost, but at 17.75% interest, which makes that the membership even more expensive.

The proprietor wanted each of us to talk to him individually. By the time it was my turn, I was pretty sure this was a job I didn't want. But I was still reluctant to walk out just based on my gut feelings, especially since I had bought a new suit and driven 90 miles for the interview. As soon as I sat down, the proprietor asked me why he should hire me. I broke in and told the proprietor that I wanted to ask him a couple of questions about the job before I answered his questions. The man got very annoyed and told me he didn't have time to answer my questions about the job. He only wanted to know what I had to offer him for the $22,000 per year he was offering to pay. When I asked him if he was running a hard sell operation, he told me he didn't think I'd be a suitable candidate for the position. I agreed, shook his hand, and left. Although I was very annoyed at the time, I eventually pretty much forgot about the experience. I even forgot the name of the business.

DirectBuy infomercial causes a flashback

So there I was one morning, watching TV and suddenly remembering that unpleasant job search experience of twelve years ago. But I was pretty sure that I'd never heard of DirectBuy, so I put my fingers to work on my computer keyboard. I quickly found the DirectBuy Web site, which was almost as annoying as the infomercial. The same chirpy blonde's voice grated every time I clicked on a tab in search of information. The Web site, just like the infomercial, was disturbingly evasive and unhelpful, providing no concrete information about what kind of business DirectBuy really is. Luckily, there are other people in the world who are freer about information sharing. In a matter of minutes, I found out that DirectBuy is the new name for what used to be United Consumers Club. Is it a scam? You decide...

What others have to say about DirectBuy

The first information I found about DirectBuy was on a blog. A guy named Brad wrote about his experiences with DirectBuy and quickly found that his readers had a lot to say. He got so many comments that he actually set up a topic for DirectBuy on his messageboard. I read through all the comments, which came from people who had both good and bad experiences with the company. I couldn't help but notice that most of the comments were overwhelmingly negative. People described experiences much like my own with the proprietor who was looking to fill his "public relations" position. A couple of people seemed neutral about the outfit, explaining that they had actually saved some money on large remodeling jobs but had a hard time getting refunds or replacements for damaged goods. A lot of people who were club members said that while the merchandise was sometimes priced lower than retail items, they were charged huge shipping and handling fees and had to wait a long time for their goods to arrive. And quite a few comments were about substandard customer service, ranging from poorly trained, rude DirectBuy employees to phone calls that went unreturned.

Joining up

So how does one get involved with DirectBuy? People join up by watching infomercials and asking for an appointment, getting referrals from friends or acquaintences, answering ads, or responding to invitations sent by mail. A representative sets up appointments for couples to come in for presentations. The representatives are adamant that both spouses come to the presentation so that no one can back away from the sales pressure by saying that they need to discuss joining the club with their spouse. I'm not sure what they do with people who are single.

At the presentation, the DirectBuy representative shows a video that explains the club's basic concept. You pay a large membership fee for the first three years of membership, then a much lower annual fee for the next several years. In return, you can purchase household goods, furniture, and building materials at wholesale. You order your goods through a catalog, but you're not allowed to see the pricing until you sign up AND pay for the club. DirectBuy representatives explain that if they revealed the prices to non members, their distributors wouldn't do business with them. When you attend the presentation, you're given the opportunity as well as a lot of pressure to join the club. If you decline, want to have your lawyer check out the contract, or otherwise need time to think about it away from the pressure, the DirectBuy representatives will immediately show you the door and tell you not to come back. If you want to join the club, you have to do it on the day of the presentation.

Buyer's remorse

Generally speaking, if you sign up for the club and they take your money, you're stuck. In some states, you have three days to cancel the contract, but according to my research, DirectBuy doesn't make that fact well known. And if you do choose to cancel, you have to send DirectBuy a registerd, certified letter within three business days - after that, you're out of luck. So unless you're a savvy customer who is on the ball about your rights, you may find yourself on the hook for a club that turns out to be a bad deal for you. Forget about making legal threats. By all accounts, DirectBuy plays hardball when it comes to their contract. If you sign it, you're stuck with it. You don't get to try the club on a trial basis.

Satisfaction is NOT guaranteed

If you buy a membership to DirectBuy, you're basically purchasing it as/is. You may find some great deals and save a lot of money. Then again, you may not make a single purchase. Regardless, you can't take the membership back for a refund if you're not satisfied with it. You can't ask for your money back if you buy the membership and never actually make a purchase that saves you thousands of dollars, allowing you to recoup the money you spent on your membership fee. What's more, the representatives you speak to can promise you the moon and the stars, but even if they make those promises, that doesn't mean they have to honor them. DirectBuy's contract includes a "No Oral Promises" clause. What that means is that if a DirectBuy member representative makes a promise to you, they are under no obligation to make good on the promise if it's not actually written in the agreement you signed. That's true even if you decide to join based on an oral promise.

Can you save money with DirectBuy?

Some people have said that they did actually save some money by purchasing from DirectBuy. However, these people are the type of folks who admit to having the ability to drop thousands of dollars in a single order. These are people who could easily spend thousands on renovating a room and think nothing of purchasing high end luxury items. In other words, they had the money to start with. These are not the type of people who buy their furniture at IKEA or Target. Remember, you have to spend several thousand dollars to recoup the cost of the membership fees. If you balk at spending several thousand dollars on the membership fees, you probably won't be able to make the most of a DirectBuy membership. What's more, if you don't own your own home, you're probably not going to be able to recoup the money you spend on the membership fee.

Would I buy a membership?

I'm sure you know just by reading this article that I wouldn't join DirectBuy, even if I had a few thousand dollars of disposable income. DirectBuy is basically selling the concept of paying for the privilege of buying things wholesale. On the surface, it looks like paying a few thousand dollars in order to access wholesale prices might be a worthwhile endeavor. But looking deeper, I see a lot of problems with the concept. First of all, DirectBuy doesn't allow prospective members to know who their suppliers are. They claim that they offer high quality furniture and building materials. Of course they're going to say that to get you to join the club. But DirectBuy doesn't allow prospective members to find out if they offer what the consumer wants before they join the club. They don't let people know how much they're charging before they join and they don't allow them to see what kinds of products they have in their catalogs. And if it turns out they're selling lemons, they don't allow their members to get their money back on the membership. By most accounts I've read, they don't even make it easy for their members to return items that aren't satisfactory. In my mind, that constitutes a scam of epic propotions. Others might disagree with me.

Another reason why I'd never join... well, it's because the proprietor at that job interview twelve years ago was so rude to me when I could so easily walk away from him. Imagine what he would have been like if he had my money AND an unbreakable contract! It's true that I came to him for a job and not a club membership, but had I been a customer, he would have had a large amount of my money and yet be under NO obligation to satisfy me as a customer. And with a personality like his, I can only imagine that he would have seen me as a sucker, which would have lowered his impression of me and caused him to treat me with more contempt. I can get that kind of treatment for free. I don't need to pay for it, thanks.

Should you buy a membership?

Of course I'd never tell you what to do. DirectBuy has apparently made some people very happy. You could be one of those people. Personally, I would never recommend this company to a friend. However, I do think everyone has the right to make their own decisions. My purpose in writing this article is to offer a warning and allow potential members the chance to do some research before they make a commitment they might regret. Before you attend a DirectBuy presentation and submit to their high pressure, hard sell tactics, I invite you to learn more about the company and its policies. You may decide you don't need to spend several hours sitting through a DirectBuy presentation after all.