Tuesday, August 14, 2012

The Value of a Warranty

Warranties have been used as a sales tool for a very long time. Unfortunately, they have often been abused as an easy way to add ‘perceived value’ to the product and close a sale. It is a tempting practice - to be able to add so much value by just adding “10 year warranty” to the quote. However, this “free” add-on is NOT cost free by any means. In some cases, it is as worthless as the paper it’s written on and can cost end-users and dealers wasted time and money.

How do you tell a real warranty from a worthless one? Some things to check into:

Warranty Length
The current standard is 5 years. Do extra research on any company offering warranties in the double digits, and avoid anyone offering less than 5 years on their standard product. Personally, I’m not a fan of “value line” product (see my previous post ), but this usually carries a shorter warranty, usually 1-2 years. However, I don’t think the cheaper cost is worth the risk. A sign is your identification to the world, it should always look great!

Warranty Coverage
Do not assume that a warranty covers everything. Most standard warranties cover the replacement and repair of parts. This does not include any labor to physically install them into your sign. Some end users like this and some don’t, so it is usually provided as an add-on. Either way, you should know specifically what the warranty covers and does not cover before making a purchase.

Warranty Security
Is the warranty underwritten by a third party? Deacon had a great post about this in July. This is a very important factor to consider for both standard and on-site labor warranties. A warranty is only as good as the company that offers it. Underwritten warranties are a kind of “warranty insurance” that make sure existing warranties stay in effect through their lifetime.

Health of the Company
Does the company have what it takes to fully support you after the sale? Will they be there to support the warranty in 5 years? When you invest in a sign manufacturer you want to know they are profitable and will be available long term. Do your research; look for pictures, references, testimonials and resources (white papers, documentation).  

Visit the Factory
One of the best things you can do is to visit the factory directly. This helps you get a good idea of how much capacity they have and how much support they can provide. Some manufactures are very open about giving factory tours (we love doing this at Vantage LED), so take the opportunity if possible. Use your own eyes to determine if they can support you long term. Make sure they can show you their abilities, not just tell you how great they are.

Remember that the warranty does not always reflect the quality of a product or company. A good 5 year warranty should be standard with any LED sign, but the manufacturer should be able to back up this warranty with a quality product, support, and good documentation.

- Scott Hofheins

I hope this post has been informative and helpful. As usual, I welcome ALL constructive comments. Please feel free to comment and add anything I’ve missed, or additional tips you may have regarding this topic. Please visit www.vantageled.com for many other resources, white papers, and of course: Great looking LED Signs!

**All posts/thoughts/writings are strictly the viewpoint of me and me alone and do not reflect nor speak for Vantage LED’s beliefs, attitudes, thoughts, etc. unless specifically stated.

1 comment:

Deacon said...

When I bought my first car, it came with a handshake and a smile (to this day, I think he was smiling because he finally got rid of the thing). I learned about every piece of machinery in that car when I had to replace yet another component, tighten another bolt, change something out and find a way to keep the car running for another week/month/year. I SWORE the next car I bought would come with a warranty. No way was I handling all the repairs and costs of fixing a car when something went wrong.

On most modern cars, so long as you maintain the vehicle well you'll likely go quite a while without having to do any significant repairs. When something does go wrong, we're often VERY thankful for that warranty. The same is true on most things we purchase now. My daughter's computer screen shut down unexpectedly. i knew what was wrong and what to do to repair it, but the warranty was in force so I just dropped it off and had someone else deal with it. Wonderful.

Warranties are great. They relieve a lot of stress and worry over what will happen when/if something goes wrong. DS is a big investment for people. Whether it's a 3'x6' LED Sign out front or a 14'x48' billboard or an interior menu board/other solution. It's a hard sell to get a business to see the value of a DS solution, once they've invested in it, the business wants that system working 24/7 for them.

Often, everyone gets so caught up in the many minute details of a sale, we forget the back-end. AFter-service becomes an after-thought until something goes wrong and then it'll be the first thing on your mind in the morning and the last thing on it at night.

Don't leave after-service to the end of a deal. Look into options from the start. When reviewing warranties, checkout the blog I wrote and make sure you (and the end-user) are covered in the event something goes wrong with the system. The faster an issue can get resolved, the better...

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