Paul and Ann Kulp of Annandale were looking for a way to save money on appliances and furniture when they joined the Consumer's Buying Service, a Northern Virginia company promising substantial discounts in exchange for a $395 membership fee.
The Kulps' satisfaction was short-lived. Although they said a CBS salesman promised significant savings on famous brand-name products, the couple wasn't shown the company's catalogues until after they signed the pale blue contract last April 18.
"We were appalled. The catalogue was so limited," complained Ann Kulp, who said she did some comparison shopping and found that area stores could match or undersell many CBS prices.
A Sony 12-inch television sold through CBS for $375 was available through the Best Products Co. catalogue for $379.72, she said. A Sunbeam mixer sold by CBS for $103.21 was offered in the Evans Distributors and Jewelers catalogue for $99.90.
"We now realize we should have back-pedaled from them," said her husband, a Federal Aviation Aministration employe. "All I want is my $50 deposit back.'"
Any complaint by the Kulps will be handled "in time," according to the company, which recently opened a new Fairfax County branch office.
In the meantime, the Alexandria Office of Consumer Affairs has received an unprecedented number of inquiries and complaints about the Alexandria-based operation. "We had several this week," said investigator Joe Ginberg.
A Federal Trade Commission report issued two months ago said that more than 200 buying services nationwide enroll approximately 200,000 members. Since most such services make their money fron the sale of memberships, not the sale of merchandise, "they have no real incentive to provide good service," the report said.
But an official of the Alexandria company, denying any wrongdoing, estimated the average savings a person could achieve by using the buying service at about 30 percent.
"Hey, we save people money," said CBS marketing director William R. Thompson, who moved to Washington from southern California in January. "Maybe it's because of Watergate, but I've never lived in an area where people are so skeptical."
Among those looking into the activities of CBS:
The Virginia attorney general's office in Richmond, which has launched an official investigation of the company's methods.
The U.S. Postal Service, which began monitoring the company's sales techniques after CBS flooded mailboxes in the affluent Virginia suburbs earlier this year with announcements that the lucky residents were prize winners. Although the prizes were said to include television sets, stereos and steel-belted radial tires, most people received $100 gift certificates for shampoos and sets at beauty parlors owned by one of the company's founders, according to postal inspector Thomas McClure.
"Your chances of winning anything other than the gift certificate are about 100 to 1," Thompson acknowledged this week. "It's just advertising . . . to bring people in so we can explain our program. The techniques are as old as the hills."
Consumers who go to pick up their prize are encouraged to listen to a presentation by a CBS salesman, according to the company's literature.
"They did a very persuasive sales job on me," said Paul Kulp, who added that he was "stunned" when he learned that CBS did not stock many of the popular items he had considered buying.
According to a complaint received by the Fairfax County Consumer Affairs Office, an unidentified salesman at CBS told one prospective customer the company had been endorsed by Fairfax Board of Supervisors member Joseph Alexander.
Alexander said this week he had once written a letter of recommendation for Victor Piatti, a neighbor and a director of the company. But Alexander said he had never endorsed the company, about which he knew nothing.
In addition to the federal and local concern about its activities, the buying service last week was told by the Columbia Broadcasting System to stop using the initials CBS inside a darkened circle that looks like a drawing of an eye, according to network attorney Robert J. Arthur.
Thompson denied the firm was infringing on the CBS-TV logotype. "Our logo shows a bullseye," he said.
"We have 1,700 members, and most of them are happy," Thompson said, declining to give a reporter a tour of the firm's main showroom at 5380 Eisenhower Ave. "The few people who've complained we've tried to satisfy. Look, any business has unhappy customers. All we [provide] is an alternative form of buying," he said.
Thompson declined to list his firm's biggest selling items or the five brands of refrigerators he said could be ordered through CBS. He also refused to give the address of the grocery outlet CBS runs, which is located at 4590 Eisenhower Ave., Alexandria.
Thompson declined to state how much the company was worth, how much merchandise it had sold, or how many members had paid the full $395 membership price. He referred those questions to Alexandria attorney David Adams Sutherland, a member of the firm's board of director.
Sutherland declined to discuss Consumer's Buying Service Inc. He refused to state whether he is a member of the company's board of directors, tell how director Victor Piatti could be reached, or say who William R. Thompson, the firm's director of marketing, is.
"William R. who?" he asked.
Another director, Todd P. Rothrock, could not be reached for comment.
The Federal Trade Commission report, based on an exhaustive, two-year study, warns consumers against high-pressure sales tactics, and against clubs that refuse to reveal their prices until after the contract is signed.
"In theory, a buying club could be beneficial," said Alan Krause, the Chicago-based author of the FTC report. "But it's a matter of great debate whether buying clubs actually save people money," he said.
CBS' Thompson sees things differently.
"I agree that most buying clubs don't save consumers money, but ours is different. We're in our infancy as far as our marketing is concerned. Someday I'd like to sell to homeowners via closed-circuit TV. Right now, if a member can find an item cheaper somewhere else, I tell him to buy it and I'll pay him 10 percent of the total purchase price as a gift," said Thompson.
"Hey, I love to pay out," he said.