Bundling warranty insurance with the PCs you are selling offers two major benefits to retailers and dealers, according to Alan Brewis, director of Brisbane-based Warranty Assistance Australia (WAA). As well as potentially providing a revenue stream to PC sellers, extended warranties also relieve them of the negative contacts with customers that come with warranty claims, he said.
Personal computers sold with warranties such as those offered by WAA give consumers a 1800 number which, if required, connects them direct to a call centre where technically capable customer service staff ascertain what the problem is with the PC. They then coordinate a course of action that will fix the problem without the dealer needing to be involved.
According to Brewis, undertaking this sort of coordination themselves takes many retailers away from what they do best.
"A lot of retailers and dealers just want to sell, they don't want anything to do with warranty and service issues," said Brewis. "The warranties allow them to upsell a customer and then if something goes wrong, the warranty system will step in and fix it for them."
He added that the last thing a retailer needs is the long-winded process of a computer coming back for repairs only to then be shipped again to the assembler/distributor/manufacturer.
"Because there are so many possibilities for how a product gets to the end user, our warranty products can go in either between the assembler and the dealer or between the dealer and the consumer."
Brewis said selling warranties has been a huge industry in the US for a few years and that the local market is starting to catch onto the idea. He said that following government awareness campaigns, consumers are now more alert to the dangers of a small dealer going under.
A lot of the recent success of big retailers like Harvey Norman, Dick Smith and the Coles-Myer group has been due to the fact consumers are confident they will be there for the duration of the computer's life cycle. From the business growth experienced by WAA, he said the evidence is clear - demand for computers with extended warranties is rising.
Warranty Assistance Australia
Tel (07) 3848 0112