Warranties and Guarantees
Are they worth the paper they are printed on?
It is my intention, over the course of this article, to give everyone as much information as possible regarding what warranties and guarantees are, why they were, and still are, used to great effect in most industries and professions, so that you can make judgements of your own regarding their worth.
The concept
Although they sound rather legal, upmarket and friendly all at the same time (no mean feat on its own) and a bit like an insurance policy if things go wrong. In fact, it comes over as much better than that as it is sold as free. Warranties and guarantees were really brought in as selling tool.
If you think about it, when you buy something, you are taking a chance that it will work or do what the person selling it says it will do - from small pieces of gardening machinery through to all types of large expensive cutting equipment to
complicated IT technology right up to large contracts where there is a need for you to bring in contractors to fulfil a large project.
It is known by the seller that, if potential buyers are sure of what they are getting and it will do what the buyer wants, the seller will be pretty confident in the
sale. The promise of a warranty or guarantee on a product is, therefore, a very powerful selling tool and does that very well. We are assured and, therefore, more comfortable on what the seller is selling.
So, does it work?
Well, it must do because they have been around for a very long time and we are not that gullible. So, yes, they do work. What we do have to be careful of is how they are being used in a given situation and the true worth of what is on offer. A guarantee may not cost in specific terms but could cost a lot in time wasted and customers becoming frustrated and disillusioned.
The real world
Here’s a real incident which happened to me concerning a warranty - and I thought I was a great buyer who never made mistakes (you certainly learn that no-one can be that good!). I spent most of my
professional career as a golf course manager with responsibilities for large budgets and answerable to accountants who were, in the main, trying to achieve what I was trying to achieve - a great golf course in the most cost effective way possible, so that our customers
could have a great experience and feel it was worth the cost. So, keeping that in mind you will understand there is great pressure put on you to do just that - provide the goods! Some time ago then we
purchased a sparkling new golf greens triple mower. We went through all the processes to ensure we were purchasing the right machine for the job - trials on the course, all staff taking part, and we even did a points scoring system on the four machines we trialled.
The machine we bought came top of our scoring system table and, because it had a three year guarantee, we could not go wrong - utter nonsense! Not very long after it arrived we found out it would not last twenty greens without breaking down. The local dealer was very helpful but that does not matter even if a fitter comes out within a few hours. If a piece of equipment breaks down, the job is not completed in the timescale set, so unhappy staff and, moreover, very unhappy customers. Following many conversations and heated discussions with the manufacturer over a long period of time, and all the time experiencing breakdown after breakdown, they offered an extra two year guarantee and also
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