Warranty claims (or Client-in-the-middle)

[sitelights]

A transformer or a controller or a fixture fails under warranty; you get the service call and troubleshoot the problem. Then you have to remove the offending object and take it to your supplier for a "returned goods authorization" and the unit is shipped to the manufacturer for a warranty claim. The unit comes back repaired or a credit is issued. It is then re-installed and the system is back to 100% operation. Two round trips to the jobsite and two round trips to your supplier and the elapsed time is 2-3 weeks (months?) ...who pays for your time and mileage? The client's lighting system was out of commission or incomplete during this process so they are not exactly grateful even if it did not cost them a cent. The warranty is your warranty, not the manufacturer's; all the client sees is you. You are out $100.00+ for no good reason except client goodwill. Try this: stock your service vehicle with at least one spare of everything you install in addition to all the "wear" items you routinely use in servicing a system. If your goal is to fix it right on the first visit you've then cut your time and mileage in half and had your client's system back to 100% the same day. If you can't fix every problem on the first visit (custom fixtures excepted) maybe you are using too many different types of transformers, controllers or fixtures. Everthing we need is in our service vehicles (station wagons... we don't run trucks in our outdoor lighting operation) to get a system back into 100% immediately. We routinely replace equipment on-the-spot with a new unit and save the RGA's and warranty claims for a literally rainy day. If you are using the right stuff this doesn't happen too often anyway. Think about the idea of limiting your range of potential replacement items. All our lighting sytem designs are different but all our equipment is the same. How many different types of luminaires do you need to get the complete range of lighting effects? Not many.

[landscapelight]

I have to say that this part of our business is a concern for me. I believe that when a product is found to be defective that the manufacturer should assist the contractor in the out of pocket expenses for their time and travel. If they are willing to build a product and sell it and collect money for it they also should be willing to stand behind it and assist the contractor in his duties of fixing that manufacturers mistakes...Luckily I am a distributor and have not had to go out to do a warranty maintaince call, but I try to get our customers some form of recovery of the costs. It is interesting to me when the contractors boast about one manufacturer having such a good warranty, or they always ship me new fixtures when I find one to be defective, what is your actual cost of replacing that fixture?

[Garry Blackburn]

Its interesting to see that this isn't just a British problem. It can be infuriating that, through no fault of our own, an item of equipment fails, and the contractor is left "out of pocket" so it's essential to cover yourself in your initial pricing, i.e if you make a little extra profit on each unit, then, if one fails hopefully theres enough profit made on the number sold over a period to cover the labour cost in replacing the offending item. Maybe, its a problem we should monitor over twelve months and set aside a small percentage of profits to cover such events. I must agree though, that this is a good argument to limit the range of equipment and therefore be able to carry spares to cover most eventualities.

[sitelights]

Most warranties that I've closely read have very specific language excluding everything but the actual piece of equipment; most do not even reimburse for shipping charges much less labor costs. I've had better response from distributors when handling an RGA (Returned Goods Authorization) in that they handle returns and replacements with no shipping charges. In one (and only one) case my distributor "comped" me on the equivalent value of a number of lamps when through their fault I had to return to a job to switch to proper beam spread lamps. When you do "six figure" business with a single distributor you'd be surprised at how accomodating they can be; as an example, my distributor provides me with an annual free allotment of replacement sockets from the manufacturer so that I can replace failed sockets under warranty in the field rather than return the fixture to the manufacturer. The whole point, of course, is to insulate the client from hassle while protecting yourself from the costs of substandard equipment. Most of my service headaches relate to the cheap, failure-prone lamp sockets that ALL manufacturers use. Search this site under "sockets" to share my pain.

[landscapelight]

I know that there are three types of sockets on the market, I would suggest the following manufacturers fixtures that use the best sockets, so you wont have to do any call backs. FX Luminaire, BK Lighting and Lumiere. While both BK and Lumiere actully silicone their sockets into the fixture I have had only one returned to us in the past four years and I think it was more of a lamp issue rather that the socket, if I remember correctly it was a lumiere 201 with took a mr11 with the DC base and the base of the lamp got to hot and metled some how. But as far as the those three manufacturers I know for sure that they spend and extra few dollars and always use the best sockets on the market so you will not have to go back and change sockets, and they will not have to deal with warranty claims.

[JPez]

This is a good discussion.. re warantees. Here are a few things I've learned in 35 years of running a business.

1. all work must include pricing that reflects common and uncommon problems in the field. Just as equippment will fail, so will job components. Charting a history of these events shows us how to charge for the inevitable, including time spent.

2. Leverage with the distributor. If you're doing large numbers with your supplier, he/she will make concessions...free bulbs, lender. or maybe a turkey at Thanksgiving. The supplier won't admit for compensating your time, but will definitely make some arrangements with you. If not, get a new supplier.

3. Substitool program. In case of transformer problems, your supplier can give you a lender. This won't compensate you for time, but it will improve customer relations and keep your inventory minimal. In the eighties I had such an arrangement with Skill. After several problems arose with thier 736 roto-hammer, I demanded action. I received a free lender 736 anytime the tool needed repair. This arrangement expedited repairs and worked very well.

We need leverage and positioning when doing business with suppliers, manufacturers, and distributors.
Jpez

[sitelights]

A post on the topic of warranties relative to the problem of "tampering" is available at "Cable, Wiring & Connectors" where we got a bit off the original topic.

[sitelights]

Our initial three year warranty is "unconditional" and covers 100% of the materials, including lamps, and workmanship. Our price policy acknowledges that warranty service will occur during the warranty period and, if nothing else, some lamps will fail "prematurely". We assume that about 10% of the original project cost will be returned to the client in the form of routine maintenance over the life of the warranty. The lamp life warranty assures that we will be returning to the job site at least twice a year or six times during the warrranty period. Using a nominal figure for an average installation of about $5K yields a warranty reserve of $500.00 and by extrapolation $85.00 per site visit. Since a $5K project contains about 20 to 25 (dependent on fixture type) lamps we expect to replace every lamp at least once during the 6000 hour warranty. A system operating from dusk to midnight accumulates about 2000 hours of lamp use per year. We aim our marketing at the affluent client and these people do not want another "system" (pool, irrigation, etc) to maintain. Low voltage outdoor lighting is a service business and that is what we provide: appropriate lighting effects, expertly installed and maintenance-free for the first three years.

Since we offer to renew the original three year warranty after it expires we can maintain a continuity of service that actually lowers our maintenance cost. The cost of a three year warranty extension (we call it a "service agreement") is based on the number of lamps in a system as a one-time charge. The cost of invoicing and processing payments is eliminated and we can make a modest profit from this income stream. Regular maintenance results in extended component life and a pleased client.

As we approach our 20th year in this field our in-house statistics support the original idea that a liberal warranty is good for business. We remove the burden of ownership from the client and in doing so establish an advantage over the competition. Giving back 10% of the project cost may seem excessive but it is the reality of a 100% operational system. Our pro-active approach (we show up and service uncalled when we are in the area) is much appreciated by our clients and clearly a value-added service that distinguishes us from other lighting companies. A significant portion of our business is in upgrades and additions for existing clients.

Our emphasis on service and the fact that we publish our price structure in detail on our web site inspires confidence and enables the potential client to quickly grasp the nature of our business. It also allows our competitors to undercut our prices but the intelligent consumer knows that the lowest price is not necessarily the best value.