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570 posts

Ultimate Geek
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  Reply # 562616 29-Dec-2011 19:11
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i Brought a $2500 TV many years ago from Bond and Bond, they tried the 'Hard Sell' on the warranty and i just replied with "I'll just buy another one if it breaks, i have s**tloads of money" (obviously a lie) and he said nothing more.

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  Reply # 562619 29-Dec-2011 19:16
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If we were to remove extended warrenties from the market prices would increase about ten precent to make up from the lost of profit. These customers buying extended warranties are saving your money!!

I wish they would remove the cga because its misleading and hard to understand both for the customer and retailer.


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  Reply # 562620 29-Dec-2011 19:17
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I've had attempts at hard sells in the past but have never, fortunately, had the problems described above. I spent just over $2k at JB Hifi the other day and got a very soft push in terms of extended warranty. I said no and that was the end of it.

Had it turned into a hard push or if I'd received the BS some of you have I'd have done one of two things:
- walked (plenty of other stores having sales) or
- had him get the manager right away. I wouldn't pussy foot around with a manager later, I'd have words with him/her front of the sales person.

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  Reply # 562624 29-Dec-2011 19:30
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It is an offence for somebody in trade to mislead you about your rights under the CGA, and what I've read in this thread gets pretty close to that if you ask me.

If I'd been in the situation, I think I would have reminded the sales person of that, as in "sir, I am of the opinion you are attempting to mislead me on my rights under the CGA, I caution you that it is an offence under the fair trading act for you to do so, punishable by a fine up to $200,000".


Kickass: If we were to remove extended warrenties from the market prices would increase about ten precent to make up from the lost of profit.


Pretty silly blanket statement to make, it depends on the number of people taking EWs, the number not, the average price of an EW, and the average price of things the EW is for.  Without knowing any of these numbers stating that the expected amortisation of costs would amount to a 10% increase on prices, is plainly nonsense.





---
James Sleeman
I sell lots of stuff for electronic enthusiasts...


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Ultimate Geek
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  Reply # 562634 29-Dec-2011 20:04
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I stopped buying extended warranties a few years back for 2 reasons.
1 was the fact I had never used one or needed to claim on anything whilst buying a warranty, and secondly was an interesting incident: was at a BBq where there was a number of salespeople from a local retail electronics store joking about how many warranties they had sold, and the fact that the person who sold the most at the end of the week got a moro bar from the manager.
When asked the salespeople admitted that the warranties were a bit of a joke. Ever since I've been at the same BBQ (that friends house) and there are salespeople from that store present, they have made jokes about the number of warranties they had sold to customers.

I now always say no politely, and if pushed tell the salesperson that they have lost the sale and tell them i am going to the competitors (3 others within 20 seconds walk).... I hate the hard sell with a passion. 

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  Reply # 562635 29-Dec-2011 20:09
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Sigh, after so many years of this nonsense going on it's a real shame to see that some retailers continue to carry on with this type of selling. Also that so many people continue to get pulled in.

My wife won't go to any electrical store anymore because of the highly negative atmosphere in these places - Dick Smith, Harvey Norman, Bond and Bond, Noel Leeming, Leader & Watt and so on. She barely tolerates LV Martin's as it is. The brands are so tarnished and have such a horrible 'urban status' attached to their shopping experience, that it's a wonder they make any money at all.

It would be good to know which branchs of stores exhibit this type of cr*ppy sales approach. The Harvey Norman in Tory St Wellington is utterly attrocious and staffed with some fairly aggressive and annoying people.

Which branch of HN was your experience at Starblazer? Don't think I saw it in the thread anywhere.
       




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  Reply # 562637 29-Dec-2011 20:11
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What are the incentives? If they are going to go hard to push a $13 warranty, maybe there is some logarithmic reward scale based on the number sold rather than the face value of it. Profit on these must be huge.

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Master Geek
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  Reply # 562638 29-Dec-2011 20:14
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Being a salesperson myself, I have seen multiple times where an extended warranty has actually benefited the customer. Their phone has broken down 16 months into having it and they have been covered by the extended warranty they purchased with the phone.

However, I do believe there is a difference between selling an extended warranty and selling extended warranties ethically which seems to be more the issue here.

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  Reply # 562643 29-Dec-2011 20:18
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gzt: What are the incentives? If they are going to go hard to push a $13 warranty, maybe there is some logarithmic reward scale based on the number sold rather than the face value of it. Profit on these must be huge.


The incentive is these days that the sales person probably makes more money from selling EW's than they do by selling the product.  No wonder the hard sell and possibly in some case they don't really care if you go elsewhere.

My law of averages is most consumer items are going to fail through the infant mortality effect and if they go 12 months, which is a normal warranty, they''ll usually last a lifetime. Therefore an EW isn't worth it.




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  Reply # 562649 29-Dec-2011 20:26
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doctormaxim: Being a salesperson myself, I have seen multiple times where an extended warranty has actually benefited the customer. Their phone has broken down 16 months into having it and they have been covered by the extended warranty they purchased with the phone.

However, I do believe there is a difference between selling an extended warranty and selling extended warranties ethically which seems to be more the issue here.


Extended Warranties have their place - they make claiming for goods can be easier. What they don't do however is override or replace the CGA.

There would be no reason why a 16 month old phone that failed due to every day wear and tear would not be covered by the CGA and there have been plenty of other such stories. Had this phone been damaged by the end user or considered to have had a harsh life then the CGA may not apply, however in this case many extended warranties probably wouldn't apply either.

The harsh truth, whether anybody likes it or not, is that retailers only push extended warranties because their are insanely high margins in them. A large retailer would typically make more from an extended warranty on a $1000 TV than they would on the TV.

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  Reply # 562650 29-Dec-2011 20:31
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Most big box retailers seem to be obstructive and slow to react when it comes to CGA claims. I'm not condoning it but it sounds like the salesperson was just stating the facts, albeit rather unprofessionally.



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  Reply # 562665 29-Dec-2011 21:11
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antoniosk: Which branch of HN was your experience at Starblazer? Don't think I saw it in the thread anywhere. 



I won't name and shame the store or sales person, the manager followed me out of the office and went directly to the camera counter - I'll give them the benefit of the doubt that "re-training" was/will be given.  




Procrastination eventually pays off.




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Ultimate Geek
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  Reply # 562669 29-Dec-2011 21:20
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richms: Perhaps target should send their hidden camera people into these places to shame them


I agree - perhaps I may send a link to this thread to Target or Fair Go.      




Procrastination eventually pays off.


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  Reply # 562670 29-Dec-2011 21:24
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doctormaxim: Being a salesperson myself, I have seen multiple times where an extended warranty has actually benefited the customer. Their phone has broken down 16 months into having it and they have been covered by the extended warranty they purchased with the phone.

However, I do believe there is a difference between selling an extended warranty and selling extended warranties ethically which seems to be more the issue here.


How did it help them? How long do you think the phone should last then? less that 16 months? If the person didn't buy the "extended" warranty you wouldn't of fixed their problem under the CGA for the 16 month old phone?



 

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  Reply # 562673 29-Dec-2011 21:34
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Hey Guys

Long time reader, first time poster.

My reaction from reading all your posts is - man there are some terrible salespeople out there! I apologize on behalf of electronics salespeople!

There are a few factors that I think contribute though:

- Salespeople are set performance requirements based around warranties, and it is a sizable percentage of your total sales, and seems to be constantly increasing.

- At the electronics retailer I'm working at, commission on EW's is average - like $2 or $3 per warranty. So I think it's generally more the first reason to why salespeople sell EW's rather than to boost their paychecks.

- The training at big outlets such as JB Hifi, Noel Leeming, Harvey Norman, Dick Smith etc, is piss poor. We receive little or no training, especially around the CGA. Most of the stuff I know about the CGA is based around me reading statute law through my studies at university, rather than any in-house training. 

- Furthermore, due to the poor pay and bad training, there are alot of incompetent staff with poor attitudes (incl. some of my colleagues). I guess it isn't much of an excuse though although it has to be a factor.

On the flipside of it, you also get idiot customers as well as idiot salespeople, who know little of the CGA. E.g. customers who have cracks in the screen of the iPhone who claim it under the CGA and exclaim - "oh I've never dropped it or applied any major force to it ever" then claim the CGA. Or people who want us to replace their computer on the spot because of the CGA - if they read the CGA the manufacturer/retailer has the right to get it assessed first before making the decision on whether to repair or replace.

Extended warranties are a hard one for me. Mainly because I agree with many of the things you say, especially in regards to the CGA. For example, a customer came in with a Macbook Pro that was two years old and claimed CGA on the computer. Straight away and said 'sweet' and sent it off for repair. No worries at all. However, I have to sell extended warranties to keep my job. I'd get a new job, but I need the flexible hours for uni (ps. if anyone needs a worker with flexible hours, let me know! haha).

I get around it by trying to accentuate the benefits of the warranty 
e.g. - In-house repair e.g. for 55" TV's
      - Covering fair wear and tear
      - Increasing the resale value of the unit, especially on Trademe and the like where the CGA's power diminishes.
      - International Warranty
      - Automatic replacement with a brand new unit or vouchers to the value of what you paid
      - Phone support (e.g. Apple Care)
      - Coverage of consumables e.g. Battery

I usually give them a decent discount, to more what in lines I would want to pay for an extended warranty. e.g. For an iPod classic 3 Year Replacement Extended Warranty, I wouldn't pay $80 if it's a $300 unit, but if it was $35 then I definitely would - especially since iPod's break down alot.

I sometimes put on the hard sell, mainly if they are undecided but generally if they say no after I say all the benefits, then I leave it. If a customer says no by default, I say "but hold on, it covers ...". 

Just my two cents anyway, you can rip into me if you think I'm wrong!Innocent

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