Warranty Works has struck a deal with Armstrong Wiley, the liquidator of failed PC distributor Edge Technology, to "bail out" channel players who feared they would be gypped by dishonoured warranty agreements after Edge's demise.
The warranty rescue plan, brokered in July and signed last Wednesday, will cover all Edge-branded PCs and notebooks - not peripherals, said Warranty Works chairman, George Boschma.
While the exact number of outstanding warranty claims was "unknown", he estimated Warranty Works would process 600,000 claims based on the number of machines Edge had moved in Australia. "Our primary challenge is we're going to be swamped by resellers and direct Edge clients," he said. The warranty service provider will begin "reviewing" and servicing reseller and end-user claims mid-week. "It's a way of protecting the creditors and end-users, ensuring that the consumers' PCs won't remain [out of order]," Boschma said of the plan.
"We're looking to reach the market and inform resellers and customers about what we're doing, via Web site promotion and a leaflet campaign," he said. Edge's reseller network includes some 1,000 channel partners including Dick Smith, Harvey Norman and Tandy, Boschma said.
He speculated that customers would be feeling some degree of deceit since it "was not clear on point of sale" that warranty companies would withdraw their services to Edge upon the distributor's collapse in June this year. "A lot of the resellers have been smoking with chagrin," Boschma said, citing "a few dozen" interstate referrals from schools, government agencies, businesses and distributors to Armstrong Wiley in the last week. "As for Edge, [complaints] reflect negatively on the group", Boschma added, "given they offered services which their business depended on."
Boschma conceded Warranty Works faced a range of risks in offering the warranty deal. "The risk we're taking on board is not knowing if Edge's quality control would have deteriorated towards its end," he said. Also, PC parts supply could also prove short in the early stages of the bailout plan. "While we have extensive channel access to parts, the difficulty is that Edge's spare parts were auctioned to CRA (Edge's secured supplier). We will have to call upon Fujitsu for drives and monitors. OEMs will come out the strongest - they are capable of handling warranty issues themselves," he said.
Edge customers can contact Warranty Works' Edge Warranty hotline on 1300 139 887 for more information.