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Extended Warranties and the hard sell

HP Artists Edition DV2890CAI think I’m usually a pretty nice guy, but the other night I got snappy with a sales person. I’ve been doing laptop research for the past few weeks and I finally picked the HP Artists Edition Laptop which was on sale at Future Shop. I know, everything is always on sale there and if it’s not, you’re probably paying too much for it. That said, I was picking it up for someone else and we had pretty much settled on which one we wanted.

So the salesman saw us eyeing the one we wanted and I said to him, I think I want this one. I asked a few questions about the ports on it, asked about the weight and the processor and two of these questions he answered incorrectly, but maybe he just didn’t know.

So, the moment of reckoning, I decide we want the laptop and say yes I’d like to pick up this one. I know I am going to get the extended warranty speech and hear about how the horrors of not purchasing it could leave me in a bad situation. Future Shop is owned by Best Buy, and both these stores are a nightmare to deal with.

So I listen to the spiel and then I say no thank you I’m not interested, I’d just like the laptop. He goes into how much each part costs and how if one breaks this one will cost 60 dollars and this will cost 200 and if the keyboard breaks the whole thing has to be replaced yada yada. He tells me how often certain parts break and by now I’m thinking if this thing really is as much of a piece of junk as he’s claiming, maybe I shouldn’t buy it at all.

Again I say no thank you, I’ve heard of, and had bad experiences with extended warranties. He then asks me what happened and I tell him about manufacturing time to fix something verses the time Best Buy took to do the same thing. He starts trying to tell me something about it being after one year and by then I phased out. I should also add that I am very tired by now, it is after work, I haven’t had dinner yet and I just want to go home with this laptop. Again, I say no I’m really not interested, I would just like the laptop please.

This is where I am starting to get agitated, he stops, pauses and then points to the power plug and says, if this breaks, that’s 60 bucks. I finally interrupt him and say “What’s with the hard sell? Do you want me to buy this laptop or not? I just want the laptop, should I go somewhere else and get it?” He realizes he’s gone to far and says no sir and grabs the keys and unlocks the shelf with the boxed laptops. Once I’m at the cash I say to him, something like I’m sorry, I’m really tired and I haven’t eaten yet and we want to get out of here. I don’t even know if he deserved the apology, but I always feel bad when I do stuff like that.

Anyway, I guess the moral of the story and the tip to take away is to resist hard sells. The very first thing I found when searching the title of my own post was an article on the CBC website Should you buy an extended warranty? (Link is no longer active, but Consumer Reports discusses it here). Basically what the extended Warranty covers is the 2nd and 3rd years. If an electronic product is defective it usually breaks long before the first year is up, otherwise it lasts 5 or more years. I have a TV from 10 years ago that is still going strong and a DVD that broke after 8 years. The extended warranty covers the time period where something is least likely to go wrong. I know Future Shop and Best Buy make a lot of money off of Extended warranties, but at what cost? After this experience I don’t know if I want to shop at these places anymore. On the bright side, the laptop is great and looks really cool.

30 Comments to “Extended Warranties and the hard sell”

  • Angela

    How awful for that associate. The public should realize that when you go into a store you encounter salespeople. It is their job to sell and try to get past your objections. They probably have a supervisor and six managers breathing down their necks to do exactly what this guy did, if you don’t want a service plan, don’t buy it, but don’t yell at the poor kid who is just trying to do his job so he doesn’t lose it. He absolutely did deserve your apology. I hate when I see these things when I’m out shopping. I really just wonder, honestly what is wrong with you people? If you don’t want to deal with salespeople then order your products online.

    • Ian Hoar

      Angela, first he was far from being a kid, second, I listened to his speech for about 5 minutes, to me that’s more than enough time for the average person to realize that this customer does not want an extended warranty, and 3rd, I never yelled at him, raised my voice or made a scene, I just calmly asked him what was with the hard sell and if he would like me to go elsewhere to buy the laptop, since I just wanted out of the store, who knows, I might have spent another 20 minutes standing there. Anyway, he is hardly scarred for life and I probably saved him some valuable time that could be used for pushing warranties on other people who might actually buy them.

      As for extended warranties, most of them are a very profitable scam anyway. Tech items, as I mentioned, if defective usually break down within the first few months, usually a year is covered by the manufacturers warranty. After this point it may be many years before they succumb to time and wear and tear. The extended warranties cover a period of time that an item is least likely to break. These warranties are not out of the goodness of the corporations heart, they make a killing off of them, otherwise they wouldn’t bother to sell them. The worst part is, they protect themselves in pages legal jargon and when something actually does break it’s either not covered by your expensive extended warranty or it takes way longer to fix than the manufacturer would take. To me this is what’s really wrong, but that’s another story, and hey if you can sell an extended warranty to someone who really doesn’t need it, why not, I have no objections there.

      Also you are right, they are told to push these, but it’s also a sales persons duty to make a customers visit pleasant and to be helpful. This sales person did neither, and if I was his boss I would have reprimanded him for being such a dork. It was obvious there was no extra sale going to happen, so give it up already. A bit of common sense would go a long way in these scenarios.

      For the record this post is 3 years old and to my knowledge the laptop is still working just fine.

    • denis

      speaking as a salesperson, we are forced to hard sell the warranties. The salesperson makes money on each warranty he sells – more money than what he makes on the product.

      Most times, except possibly electronics, we are commission only so for some people that little bit extra helps. With younger salespeople they don’t understand when to quit on the sale of the warranty.

      The problem I have with it is that it if my managers make me go too far then it aggravates the customer, gives the store a bad name, and quite possibly can mess up the product sale.

      Strangely, that same manager that is hassling the kid to sell the warranty would find that if he tried to sell it he would fail most of the time also.

  • fred

    I am usually under lots of pressure to sell a warranty, but i don’t believe in them, they do however work but what if the additional two year period expires and the product fails in the 3rd year? suggestions: you still should have taken that extended warranty for your laptop computer, it would have given you a peace of mind, trying putting yourself in the shoes of that poor salesperson?

    • Ian Hoar

      Fred, since when did it become the customers job to make the sales persons feel good? I thought it was supposed to be the other way around. As I mentioned above, all I asked was if I had to take my business elsewhere. This is hardly traumatizing.

      I’ve already argued the merits of extended warranties, if people want to waste their money they are entitled too, my peace of mind does not come from wasting my money. Also, if my product fails in the 3rd year it’s probably obsolete by then anyway or I could by a new one for less than the price of the warranty. We are talking tech here, how much does a laptop from 3 years ago cost today? Anyway you look at it, it’s win win for the store and not the consumer.

      • Kevin

        I don’t actually believe you have any idea what your talking about. I personally get a lot of customers like you at the store where I work that just don’t want to hear it. Granted I do not and will not badger a customer about a plan that doesn’t want anything to do with you. That’s like trying to make a little kid eat their broccoli. What you failed to take in perspective is that a lot of these manufacturers do offer a one year. However, most of them only cover limited manufacturers defects which is another word for pretty much nothing at all, as well as charge you for shipping a lot of the times.These warranties or service plans allow you to be backed up and fully protected by another company. The fact that you even pondered about whether you should buy the product or not after he pitched his plan is an absolute joke. What you don’t understand is that it is standard that laptops and computers are made with cheaper parts regardless of what make or brand you go with. Manufacturers are trying to limit costs and therefore decreasing life and overall durability of the product.You claim that most computers last 5 years, well that is not always the case. Not only that but most companies also offer you to extend the plan even more.

        You make it seem like its an absolute scheme, when on the contrary it simply is not. A store is not just taking your money. They are offering protection for the product as well as customer service for that particular product for a given amount of time in EXCHANGE for your money. Understand the difference? Have you ever tried calling a manufacturer for service on your technology. Have fun holding! If you would have honestly gone in there with an open mind and actually listened to the salesperson you may have learned these things. However, you utterly failed in being respectful and keeping an open mind to save yourself a bit of money. I’ve witnessed multiple customers come back within a couple of months time to say that their pc is broken and they can’t get in touch with the manufacturer in East Guam and ask to get their money back without a service plan. Well that is certainly tough luck at that point. Those that have actually purchased the plan will feel at ease when they know that their computer is being taken care of by being fixed, replaced, or that they are given a cash card for the amount paid at date of purchase. You claim that you would just purchase another computer if anything ever happens to it. Well I’d like to see how you really feel if it ever happens to you. Enjoy the dent in your wallet!

        Point is, in that situation you should listen to someone who is giving you information and not completely block them out. Ask questions and get involved in what your purchasing, then make your decision then. Sales people become annoying only when you let them become annoying by giving them the cold shoulder. If you really aren’t interested they will get the picture….and guess what….you can achieve this without behaving like a total jerk =]

      • Ian Hoar

        Kevin, it seems like the only people defending these things are the ones selling it. Do you seriously think that a company like Best Buy would sell extended warranties out of the goodness of their hearts and make no profit what so ever? These things are big money, because contrary to what you say, electronics don’t just randomly break all the time. If it wasn’t big money they would not push their sales people so aggressively to try and sell them. It’s not rocket science here. As I mentioned this sales person was particularly aggressive, I actually was at Best Buy this week and we declined the extended warranty and it went down without a hitch, the guy did his speech, we listened and then he let us buy out camera.

        As to your claim on contacting the manufacturer, I have a story for you. The original Xbox 360 was notorious for breaking down. A friend of mine had a best buy extended warranty and it took 6 weeks to get it back. I did not have an extended warranty and dealt directly with Microsoft. They express shipped me a box, I sent it back and I had my new Xbox back in less than a week, which a year later broke again and I went through the whole process one more time. If you don’t buy junky brands, they are usually pretty good to deal with, they have a reputation to hold up. Apple is also another very good company to deal with although they push Apple care, because again, it’s a big win for them.

        You should Google Consumer Reports and extended warranties, they have written a lot about it and say it’s a gamble at best. Don’t get angry at people because they don’t want to throw their money away. I had a camera break after the 1 year warranty, yes it sucked and I didn’t have an overpriced protection plan, but guess what, cameras are about half the price from when I bought that one, so we just got a new one. I highly doubt any warranty would have protected it since it was kind of my fault it broke, and the newest camera was 130 dollars, about a 3rd of the old one. Does a 130 dollar camera really need a 45 dollar extended warranty? I mean come on, that same camera will probably be half that price in 6 months. If I were to add up all the times I could have bought an extended warranty on televisions, computers, laptops, cameras and video game consoles, I could have easily paid for replacements for the occasional breakdown that may happen once in 15 years and have.

        Being rude to sales people is wrong, I realize it’s their job to sell these, but it’s also their job not to be an aggressive jerk when the customer says no.

  • Kevin

    You should honestly know that most Best Buy staffs primarily consist of incompetent morons that will try to sell you anything because they work on something called commission. Their extended warranty sucks and their overall knowledge and customer service is so under par its preposterous. The only reason they get a lot of business is because of their stock. I personally however work at Staples where we receive no type of commission whatsoever. The point is I get a lot of customers that don’t want anything to do with you and that go in and say I’m not listening to this guy because…cough cough… I KNOW IT ALL…..and then there’s the customer who takes the time to actually listen and engage with the associate and then may or may not get protection…I personally enjoy dealing with the customer that tends to listen and take part in conversation and asks questions even if they don’t end up purchasing the plan, rather than completely ignore you. It honestly feels like your wasting your time at these stores because the whole part of the process is customer service. If you don’t want to hear it, ORDER ONLINE! Is it really that big of a deal to wait a whole business day to receive some of your products? Most of the time you can find it cheaper than in store. Point is, you don’t wanna deal with associates, so in all honesty, there isn’t going to be one associate that wants to deal with you. So stop wasting everyone’s time! =]

    • Thea

      Kevin, being an employee from Best Buy, I’d just like to let you know that we’re also a non-commissioned based store. The sales people trying to sell warranties are in the same position as you have been in. There will be those customers where they’ll be completely rude, shoo you away at your register, and then stay at your register after paying and just talking to their friends while the line grows. There are also the customers as you said, that you build a strong connection with because they aren’t in a hurry to go somewhere and they aren’t afraid to talk to you on a level where they don’t feel like they’re just another dollar sign to you. It’s all the same wherever you go.

      Ian, I’m sorry to hear that you had such a horrible experience, and I know exactly the type of person you’re talking about, because I see them here and there at my work too, I work with them! There are those people where the warranties will come in handy, particularly accidental plan ones if you’re the clumsy type. My roommate spilled a cocktail on her laptop on accident and they replaced her mac with a brand new one in about a week when she went to Best Buy. However, if people are certain that they won’t need it because they know they can actually take care of their things, then I don’t try to push the sale past two or three no’s. Being an employee that works there, my personal goal is to make sure you do know that it’s offered and the advantages it has over the manufacture warranty, etc. Whether or not you go for it and get it, it’s your choice. But if something happens to it later on I just would want you to know that it was offered to you, and hope that it stays fine.

      Unfortunately my PS3 just died from a power failure so I’m going to have to take it to get repaired. Hopefully I won’t have to buy a new one. But because of how long it lasted (4-5 years without being faulty until now), I probably wouldn’t get an extended warranty. I think the warranties stand for certain people under certain circumstances, but so long as that was offered to you, can’t say I didn’t try! Hopefully your future experiences will have more understanding sales people that don’t try to pry at you.

      As for them trying to not get fired, it is true. A lot of the times my supervisors tell me to push sales on customers until they get mad at me, which astonished me that that would even be insisted. Here’s just another employee that wants to make sure you have a good experience so you keep coming back.

      • Ian Hoar

        I think it’s all about body language too. A lot of people will be receptive and a lot won’t, it should be easy to spot the people who just want to buy it and go. Work on the ones that are unsure, but if someone doesn’t want it, just let it be.

        I never buy them because I buy a lot of tech stuff and I’m careful with it. Even if a gadget does break and it’s not covered I’m still ahead of the game because every warranty extension fee that I have turned down more than compensates for the cost of a new gadget.

    • Matt

      Best buy salespeople are paid hourly, not commission.

  • Lowes Employee

    I work for Lowes in the appliance department and here at my company we have a new standard that if we don’t sell 30% of our appliances with an extended warranty attached to them we will be moved from our department to someplace else in the building. It has caused much stress with the employees. Our dept is the dept that makes commission so moving somebody from appliances to say lumber or paint would be a massive pay cut. Thus the reason you may get a hard sell on an extended warranty with Lowes appliances.

    • Ian Hoar

      Well that seems to be bad business sense to me, but what do I know. At the end of the day, an angry customer is bad for business, period. I don’t shop at Lowes, but I’ll be sure to avoid it in the future too. It’s bad on two levels, it’s not a nice work place environment for the employees and if employees are stressed out, it will lead to bad experiences for customers.

  • Mathew

    This actually kind of makes me laugh.

    Sure, the guy was a tool for being so forceful, and I work at an electronics store in Australia, and while the profits are good, for a lot of customers, it can be worth it in the long run.

    The reason I say this made me laugh is because just today, I had one person who came in and raged at me for about 20 minutes because it has, so far, taken his phone 8 weeks, and it’s still being repaired. We did him a favour by processing the repair, because it was on the manufacturer warranty, even after he was offered our plan for only an extra 35 bucks, in which case, if it stopped working, he could have come in and we would have flat out replaced it, and he would have been gone in about 2 minutes.

    I also had a person who came in with their receipt for a TV and said the screen stopped working, and I said we couldn’t do anything because it was two days after the manufacturer warranty, and she had also been offered the extended one/plan.

    I think warranties on small things are stupid, but on expensive items, I think they’re worth it. You never know what can happen.

    • Ian Hoar

      Thanks for the comment Mathew,

      I still believe warranties are not worth the extra cost. Even if an electronic device breaks in 1 year after the manufactures warranty expires, it has usually depreciated in value a lot. Now if I was only to ever buy one TV in my life I would agree with you, but once you add up all the televisions, laptops, set top boxes, computers, appliances, routers and other gadgets I may buy, it quickly becomes apparent that these extra costs for extended warranties will add up and even if the odd device breaks down after the manufactures warranty, chances are, I can either upgrade to a better device or buy the same device greatly discounted. Either way, all the extended warranties I have skipped in my life easily outweigh the costs of replacement.

      • Nichole

        It may depreciate in value if it breaks two yrs later but you get the full purchase price for it. If you payed 800 and it breaks two yea later and is only worth 500 so what! You get 800 plus tax. That’s how my store works.100 bucks to cover two yrs accidental on laptops under 5. What’s to stop someone from “dropping it” at the two yr mark and getting a full refund? I actually think our plans are great.but I don’t push ppl to the edge. Or babble about how much each part costs and all that. I am a tech nerd and I would never want someone to feel like the product is crap or bash the manufacture. You want it cool.if not that’s fine too.im under pressure but I want my customers to be as excited about their new toy as I am.

  • GP

    I just want to say that, I understand where you are coming from. People who have bad experiences with Extended Warranties will never buy them. I bought a car 2 years ago. I purchased the extended warranty, I had an issue with my car. Let me say that I am very familiar with cars. When I brought my car in, they found it was something that wouldn’t have been covered by the regular warranty but my extended warranty did cover it. Suffice to say the warranty saved me $1000.00. Extended warranties should not be purchased if you cannot see the value. If you have ever had a lemon you would understand. You have to remember that these guys have a job to do. They have bosses just as you have bosses so they have o answer why they didn’t get something done. I invest in the warranty because in case something happens, I don’t want the manufacturer deciding on whether they are going to fix it or blame me for the defect.

  • Anil

    I believe with an extended warranty one needs to see the value that is being offered while buying it with the product rather than condemning it outrightly. If the manufacturer warranty was so great why would most of these guys would only offer 1 year Limted warranty with lots of fine print details which we dont read normally and not do a 4 or a 5 year comprehensive guarantee coz they know it would cost them money if they had to extend it on account of maintenance or repairs and their product does not stay competitive enough end of the day as supposed to the competition. Bottomline for any manufacturer today is to keep their costs lower by probably not using cheaper parts but by skipping quite a few critical quality check controls that costs them a lot of money, so the chances are there would lots of these parts or components in the products that we buy today which are bound to fail or degrade over a period of time.

    • Ian Hoar

      Anil, you kind of contradict yourself. If companies are out the make money and these products fail so easily then why would Best Buy, Futureshop and the likes be willing to take the hit for the manufacturer? This is a huge profit for retailers, because the fact is, the products just don’t fail as much as you think. If a product is truly defective like the Xbox or even some generations of iPods the manufacture extends their warranty do to pressure or even class action lawsuit. I believe the Microsoft warranty on the initial Xbox 360 was extended to 3 years. There was a defective iPod that was recalled and you got a new one from Apple regardless of when you bought yours or the condition it was in. They also had defective chargers that were recalled and replaced for free (although I never returned mine and it still works fine).

      Also why would sales associates be pressured to sell extended warranties? One reason, profit! They also have the infrastructure in place to better deal with customers than the manufacturer does. They are customer facing, the manufacturer is not.

      I also believe that anything over 3 years old in this industry might as well be free. Canon has some new cameras that are 60 dollars now. You compare a point and click from 5 years ago and it’s about the quality of most cellphone cameras now. The fact of the matter is there is just no point in insuring this stuff for the ridiculous premium you are often charged. If it makes you feel good then fine, but add them up over time. You will lose more than you will win. If they were truly beneficial to the customer, then they would not be beneficial to the retailer and thus would not exist. You are right, companies are out to make money, not lose it, and that includes the retailers.

  • FACTS

    I find it funny that no one will tell Ian the truth. Here it is, WE DONT CARE IF YOU BUY A COMPUTER FROM US. WHY? The profit on a pc without other attachments is almost 0. Like I said 0. Not only does your purchase make the seller look bad, but the manager everyone above. To be completely honest you are lucky that you weren’t around a competent seller. He would have told you fine let me get your laptop, come back and told you that are manager is looking for it in the back for about 30 minutes or so why I talk to you about other products. Now with that being said, if you want to buy a pc and not deal with this you can do one of two things. Buy it online and have it shipped for free, and dont make the store look bad, Or be a asshole and tell the seller you want a bunch of attachments and then at the register change your mind.

    • Ian Hoar

      If that’s a competent seller we’re all in trouble. There’s no way the average person would stand around for 30 minutes. Many sales people are not like the one I encountered in this article. Your comment is mostly rhetoric.

  • Damien de g

    Best buy do no sell extended warranties, they begin as soon as the warranty is purchased.

  • John

    “I could by a new one”
    Glad you have the luxury of when something breaks you can just go out and buy a new one. I’m sure millionaires dont buy warranties on cars because if it breaks, they’ll just buy another one. I’m not going to claim you are the countries 1% by any means, but some of us dont regularly buy a laptop, and save up for a long time to get it when we do. It would be devestating for me to spend $1000 and be out of luck 2 years later. Stop talking like you represent all of us. Do you have full coverage on your car through your insurance company? The law doesn’t require you to pay for it but it’s funny how you probably pay for that every single month, even knowing the insurance company is earning profit. Fail on you for not being in touch with average people who don’t have the ability to go “buy a new one when it breaks.”

    • Ian Hoar

      Hi John,

      Here goes, I feel like a broken record here.

      I am anything but a millionaire, and quite to the contrary of your post, I don’t have the money to waste on an extended warranty. If they make you feel good about your purchase, then by all means buy one. The point of the post was to illustrate that the industry is making a fortune off of extended warranties, they are extremely pushy about selling them, and they are not a deal. They do a hard sell because of the money they make. I think people are touchy about this subject because they like to feel safe and don’t want to feel they have paid more than they should have or were ripped off.

      As for your $1000 dollar laptop example, it would be covered by at least a 1 year manufactures warranty which is the period of time it would be most likely to break down. The extended warranty would cover the safest and least likely to break down period of time. If you use electronics a lot you will know that they generally break down in the first week or so if they are faulty. After that they usually last a lot longer than your extended warranty will cover. Over the past 15 years I’ve bought televisions, laptops, desktops, cameras, speakers, and more. I only had one break and it was a camera, it broke in the first week and was returned with absolutely no issues.

      Instead of getting mad look at the facts. These companies push these for a reason, they make a lot of money, so much that if you look at the number of devices I have bought above, all the extended warranties added up would have easily covered a replacement of even the most expensive items. Not only that, but if money is truly an issue then you can get a refurbished or used version of your exact model for more than half of what you bought it for, maybe even less then the extended warranty would have cost you and they will likely give you are refurbished replacement anyway. Electronics drop in value extremely fast.

      Maybe consumer reports will better sway you.

      http://www.consumerreports.org/cro/extended-warranties/buying-guide.htm

  • Aaron

    Ian has some good points. Being both a consumer and retail store worker I always say “buyer beware”. Do your research before buying a product and consider all options the store recommends. I work at Staples and I like to tell people about their options because if I choose not to then i’m making the decision for them. This is not a good thing for the customer or me as an associate. We are encouraged to sell the plans but we always keep the same attitude when taking a product back on the plan. We know that another customer is happy they bought it. Buying online is not the best solution to those who don’t want service plan speeches because often it involves mailing a defective product out to a service facility and having to wait longer for a replacement. Obviously this was not the case re: Ian’s friends Xbox but each store handles the returns as it wants to i suppose.

  • Roger

    Well I apreciate that you don’t want to spend the money on extended warranties however, you haven’t really done your research. Laptop failure rates are 20% in 3 years: 1 in 5. You are incorrect, they fail in the 2nd and 3rd year, not in the first. Failure rates in the first year are miniscule, less than 4%, and they usually fail right off the shelf or within the first few weeks, usually well within the return policy of most retail stores.

    Extedned warranties on laptops are a waste of money for 4 out of 5 people, since for those people they don’t fail. However if you are the 1 in 5, the warranty is awesome. It’s a odds game, a gamble: the odds are 1 in 5. Find me a lottery that has a 1 in 5 chance? Yes the deck is stacked in the stores favour, why would they offer it if it were otherwise??! Why would anyone sell anything without profit??
    Manufactures are required to provide you with one year warranty, why would you think the faluire rates would be in the first year? How would that make any sense fro the manufacturer?

    Also you seem to be confused about the nature of free market capitalism. Corporations and business have to make money to stay in business and feed theri employees (who then buy stuff from other business). Of course there is profit in extended warranties, why would anyone assume otherwise? Somehow if they make a profit this is bad? Extended warranties are a service, like them or hate them, people use them, and most people if they are one of those 1 in 5 are happy people. Profit is part of the system, why is this somehow a sin?

    • Ian Hoar

      Your stats on failure rates are conjecture without anything to back them up. Also you are saying things I did not say and you contradict yourself more than once in your own post. On the one hand you say they do not fail in the first year and then you say they fail within the first few weeks, which is exactly what I said. I also never said they fail a lot in the first few weeks, but if they were to fail that’s usually when it happens due to being defective or several years later, rarely in the 2 years an extended warranty covers.

      As for failure rates, I work in the technology industry and buy a lot of tech gadgets myself, and while this may be anecdotal evidence I’ve never seen anywhere near 1 in 5 failure rate unless it was an Xbox 360. As I’ve mentioned several times in other replies, most tech devices are obsolete by the time they fail or cost a fraction of what you originally paid anyway.

      Also, I never mentioned anything about free markets or capitalism and there is no confusion, so don’t put words in my mouth. I invest in companies I generally dislike as an individual, since I know they will deliver big margins do to their aggressive nature. The original point of this post was the crappy service I received and my personal belief that you are throwing your money away if you buy extended warranties, however if they make you feel warm and fuzzy, then buy them.

  • Joe

    Ian, you are a consumer like all of us. I know this post is old, but you have the same erroneous and old school mentality that many consumers tend to have when it comes to failure rates. Your claims have no foundation aside from past experience with things…is that a good barometer given how different the world of manufacturing is today?

    You seem to like consumer reports. Below is a link for their 2006 Product Reliability Survey in which they will detail the statistical averages that you are swinging and missing at. If anything, this has gotten worse in ten years.
    https://inthenation.nationwide.com/know-your-repair-rates/

    You have the choice to buy or not, and we would not hammer you like that…but the plans do work, and we care about you feeling comfortable coming back to shop with us again. If you buy a $800 laptop (or in my world, a $2000 fridge) and you are faced with a repair of 1/3 the cost of the original purchase after 2.5 years…it leaves a pretty bad taste in the consumer’s mouth, and most times they will think twice about where they buy their next one. We can’t afford that. Many will call us (after calling the manufacturer to learn they couldn’t have less sympathy for those situations…) and ask us what we intend to do to keep them as customers. So the expectation is that we open our wallets and cover some/all of the cost of the repair…since the manufacturer won’t, and the consumer feels they shouldn’t have to spend for service on a basically brand new machine. So to summarize, no purchase at the time of sale with a long list of objections/excuses why it is a “scam” designed to put the sellers in the same league as Scrooge McDuck…but then the onus falls back to the DEALER (who didn’t build the product, and no longer owns the product) to manage the outcome of the buyer/seller relationship long after the opportunity to protect the BUYER from this very situation was declined by the BUYER.

    When a product is designed that becomes exempt from the type of RANDOM FAILURE (it is absolutely a real thing in the appliance industry) that frustrates us and our customers…then the brand who brings that to market will put all the rest out of business. In the interim, know that there is no special secret…no amount of studying the brands available today…no spending for “quality”…that will bring the consumer back to the 50’s/60’s/70’s when manufacturing pride and reliability were the driving force behind the design of products…some of which are still kicking today. In 2016, the impetus for design is driven by the DOE, to make the products energy efficient and environmentally friendly…not long-lasting or reliable, at all.

    Ian, and all consumers…due diligence is necessary if you want to make smart decisions at the wrap stand. Do not count on past experience. Do not rely on the manufacturers to take care of you (in the appliance industry, I rarely see one step up to the plate when they have no obligation…) outside of their implicitly stated responsibility in the warranty terms. And please stop having an automatic prejudice and distrust for companies that offer extended service plans to their customers. We are not evil, money hungry demons…we are people, with families, and with empathy for our customers. In many cases, we purchase extended service on the products that we purchase for our own homes as well.

    Now…droppin the mic.

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