🚀 go-pugleaf

Phil Kane wrote:
> On Mon, 01 Oct 2007 03:24:02 -0700, SFTVratings_troy@yahoo.com wrote:
>
> >I've worked in sales, but I tried to avoid lying.  For example when I
> >was in college I worked for Sears.  They instructed me to "sell
> >extended warranties" I complied, but I also told the customers that I
> >thought it was un-necessary.
>
> Recently I had an expensive Nikon camera damaged by being knocked off
> a table to a concrete floor.  Had I not had an extended warranty
> policy (read: insurance) the repairs would have cost me almost half of
> what the camera cost, because they had to send to Japan for major
> repair parts to rebuild it. ..........


Well there are exceptions to every rule, and your hyper-expensive
camera is that exception.

But in the case of a GE Refrigerator or a Sony stereo, an extended
warranty would be a waste.  These items are so cheap & readily
available that, should they fail, you can easily take the ~$100 from
the "extended warranty" (which I the salesman told you not to buy),
and use it as downpayment to buy a new fridge or stereo.

The thing is:  Most appliances DON'T fail.  They follow a mortality
curve:

- HIGH - birth mortality (as a result of manufacturing flaws) -
covered for FREE by the manufacturer
- LOW - middle-of-life - virtually no failures.
- HIGH - geriatric mortality - around 15-20 years - the parts are old
& die - which is NOT covered by extended warranties, because these are
only 5-7 years in length.



The reason why Sears pushes salespeople to sell "extended warranties"
is because that's where the money's at.  99% of customers have no
problem whatsoever (or if they do, it's covered by the manufacturer's
FREE warranty, not sears), and thus Sears gets to pocket the money as
almost-100% profit.   -----  Want to get rich?  Sell insurance on
brand-new products, and make sure it expires at around 5 years, that
way you won't have to pay out, other than a few dollars here & there.



I bought an extended warranty for my Dodge Avenger.  You know how many
times I used it?
- zero
- and when the Avenger eventually started failing (10 years), the
warranty was expired.
- and thus I wasted $700 for nothing.

I'll never do that again.



> Similarly, I had a hard disk die a few days after the extended
> warranty period expired, and CompUSA was good enough to "stretch" the
> expiration date and give me a new one at no cost.

Yeah.  But.  You probably could have bought a brand-new hard drive,
same size, for the same amount of $$$ or just slightly more expensive,
as the extended warranty cost.

I just bought a 300 gig drive for only $70.  They are dirt cheap
Cheaper than buying the crummy service plan.



> I believe in extended warranties.

I don't.  Everything I buy seems to last forever.  If I bought
"extended warranties" I would just be wasting my money (see the
Avenger example), since I would never use them.