§ 5-98 Discount Departments.
RCNY § 5-98
A retailer may not use the words "discount," "bargain," "warehouse," "bargain basement," or other similar terms in characterizing a particular department or section within his regular retail operation unless (a) a substantial percentage of the dollar volume of the last previous selling season within that department or section was derived from items sold for less than genuine list, catalogue, suggested or retail market prices. It shall be presumptive evidence of violation of this section if the advertiser cannot show that at least 35 percent of the dollar volume in the last previous selling season within that department or section was derived from items selling for less than genuine list, catalog, suggested or retail market prices for such items; or (b) all items not presently being sold for at least 5 percent less than genuine catalog, list, suggested or retail market price, are clearly and conspicuously designated as non-discount items. This requirement of designation may be satisfied by segregation of identified non-discount items, shelf labels, or other prominent signs, a listing of non-discount items clearly and conspicuously displayed in the relevant department, or a standardized sticker or tag with a clear and conspicuous explanation that the item to which it is affixed is a non-discount item. Example: A shoe department in a retail store sells brands X, Y, and Z shoes. Brand X is sold at less than retail market price, and brands Y and Z are sold at retail market price. In the last previous selling season, 35 percent of all shoe sales came from the sale of brand X shoes. The store is in compliance with this article. But if less than 35 percent of all sales came from sales of brand X shoes, brands Y and Z must be conspicuously designated as nondiscount items in order for the department to be called "discount shoe department."
