Warranties – It is your money that you’re holding hostage

Warranties – It is your money that you’re holding hostage

Start the Conversations

This is a conversation more than a monologue, what I mean by that is you should be having conversations with team members, co-workers, employees and factory reps (do they exist anymore?) on this topic quarterly. Warranties….the ignored issue for many at the store level and even the Distribution Center level.

Everyone considers warranties as returned parts or components that come back with little or no explanation other than “it didn’t work”.   The problem with that definition is that we know even before parts go out the door or walk away from the counter in a customer’s hands, it’s probably coming back as a defect. It happens every day and we don’t do anything to stop it. In many cases we encourage the test piece to be sold, seeing if that cures the problem. That’s called “Russian roulette with someone else’s money and parts”.  Please carefully consider the potential lost sales, lost ability to deliver to other accounts because of these “try it and see” parts sales.

The other situation occurs when a counter person doesn’t ask the right questions. A knowledgeable counter staff can prevent trial parts going out the door by asking the right questions:

If this is the third PCM you’re “trying” today, ask if there is a potential problem with the electrical supply or feedback from one of the components that may be blowing out the circuitry on the PCM causing the failures. This should have been done with the second unit and never gotten to a third but others may send out warranty replacements without even asking.  Got a second fuel pump going out?  Check the returned unit to see if the replacement electrical connections were used, chances are if the new components are still in the box…the problem is a connection and not the pump.

Every returned item you get back over the counter or back through dispatch should be reviewed to insure it can go back on the shelf and be sold as new. I’ve worked at several large WD’s in my tenure in the parts world and they all inspected every part returned. That means opening every box or package and looking closely at the parts…checking terminals to see if it was installed, looking for fluids that had been added, verifying that it is nothing more or less than a new uninstalled part.

Why Bother?

Here’s where you shake your head and start muttering that it’s impossible, the operation is too busy, can’t possibly open every box and check every piece.  If you thought that, said that, then you’ve admitted you’re not going to bother. You’re potentially going to send out “used” parts as new to valuable customers, waste delivery time, diminish your capabilities to deliver more each and every time you send out a “used” component. What’s the cost?   Lost sales, pissed customers and money tied up in the returns department waiting for review and return approval.

We as an industry have been conditioned to never question the customer, quickly replace any return for whatever reason and the manufacturer will take care of you.  As components get more expensive to produce and inventory, that sales philosophy is going to change drastically in the near future.

Remember: Nothing kills sales as quickly as customers getting the impression that your parts and components are defects waiting to happen…….educate your counter and sales staffs, review the returns closely and stop taking used parts, someone else’s parts and fitting room returns.

Educating your customer equals trust

Educate your customers as well. Abusing your inventory….borrowing your money so to speak, because their employees are not up to speed on theory or diagnostics, don’t have current updates to scan tools or are simply guessing shouldn’t be tolerated.  Never be afraid to fire a high return rate customer because if you really review their numbers, you’ll find they’re costing you money, not adding to your bottom line.

After all……when you look at parts going out, they translate to dollars in sales, every part returned as a warranty is a lost or discounted dollar.

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Counter Training 101

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The Counter Training 101 Program with Bill Haas covers multiple aspects of work as a Counter Care Professional. It deals with the necessary steps for proper phone skills, important recording and cataloging of information, terms you need to know regarding critical math abilities, doing transactions from start to finish, understanding technical resources that will help the customer, knowledge of crucial codes and chemicals, and how to grow into the best version of yourself as a Counter Care Professional.

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