Anyone who has considered retailing products imported from China has considered this dilemma: what happens when I sell my customer a faulty imported product? Who covers the warranty? All options have clear drawbacks. If you are working with a reliable Chinese wholesaler, they may have a warranty on exported products. Assuming that the company will honor this warranty, this option still involves a lot of shipping costs and turnaround time. If you insure your own products, you will undoubtedly take a hit every now and then through no fault of your own. If you choose not to offer a warranty on your products, you are likely to have a growing number of angry customers, which isn’t good for business. Fortunately, there is another solution available.
A Company called Squaretrade has offers 3rd party warranties on Chinese imports. Started in 1999, Squaretrade claims to charge a warranty fee that is 40% lower than most retailers. What they offer is a CarePlus plan that allows you to choose the length of your warranty period (depending on the product, from 1-4 years). They boast a 5 day service guarantee, and will pay the buyer full price if the item cannot be repaired. However, they are very specific about what is not covered. This list includes product failures within the first 60 days, accidental damage, accessories and consumer replaceable parts, software, and “certain types of items.”
While they have certainly covered themselves (especially with that last exclusion), this is a viable option. It does add an additional cost of time and money for your customers, as they have to sign up for theCarePlus program and pay the warranty fee. However, the increased security may increase your sales, as customers should feel more secure about their Chinese electronics. Squaretrade also shares up to 40% of profits made on warranty sales with sellers, so you earn every time your customers buy this warranty.
Related posts:
