Deal-lovers on hook as coupon site files for insolvency
TORONTO — Deal-lovers who bought everything from toothwhitening treatments to digital cameras on DealFind.com and TeamBuy. ca are angry about getting burned along with some merchants after the cut-rate online coupon sites’ insolvency filing in Canada.
“The bottom line is caveat emptor — if it looks like too good of a deal, it probably is,” said John Eacott of Woodstock, Ont., one of many consumers who is out money after Couch Commerce Inc., the operator of daily deal websites including DealFind.com and TeamBuy. ca, filed a notice of bankruptcy protection under the Companies’ Creditors Arrangement Act on Aug. 29.
Toronto-based Couch Commerce, which operates the largest couponing sites behind Groupon in Canada, listed assets of $3.4 million and liabili- ties of $19.2 million in its filing.
Since its inception, the group of companies has “accumulated significant losses,” reaching a deficit of $55 million by July 31, according to a court filing from its trustee. DealFind owes $11 million to more than a thousand unsecured creditors across the country, according to court filings; Couch Commerce owes secured creditors $5.5 million.
TeamBuy and DealFind, meanwhile, are answering customer complaints with a form email informing that the businesses are in the process of restructuring, and cannot honour “TeamBucks” coupons or issue refunds for any purchases made on or before Aug. 29.
Eacott had a $20 credit with DealFind since he returned a faulty GPS car navigation system last year, and recently applied the credit toward part of a new DealFind offer, $34 for a device that measures blood oxygen saturation.
“It was supposed to be delivered Sept. 1,” he said. When the device never came, he got in touch with the company, which sent him a notice that they were in restructuring. Eacott was out the $20 credit from DealFind, but his credit card company refunded the remainder of what he’d paid.
Others customers have taken to Twitter and Facebook to express outrage that the websites make no mention online of the current situation, and seemingly continued to sell coupons for several days after filing for protection from its creditors, though the number of deals scaled back significantly.
Groupon, the largest daily deal site in North America, has been struggling to find a profitable business model despite making consistent revenue gains and replacing its CEO last year.