[Whitigir]

Agreed. Are distributorships structured so that extending warranty service eats into the profit for the distributor?

Should be, just economy 101

 

[Sonic Defender]

Should be, just economy 101

No, it shouldn't be. The distributor distributes the products and acts as a proxy for the company, the warranty is extended by the company and I see no reason why the distributor would pay for those costs. If they do cover the costs of warranty work upfront, I would have to assume that the distributor would submit warranty expense claims back to the company. Otherwise why would you agree to distribute the product if all the potential warranty costs came from your profit? Now if the profit per item sold justified the potential expense that is different, but Jason suggested that the distributor doesn't earn as much as the dealer so with your rationale the dealer should then be covering the warranty cost. Neither scenario makes sense, the company issues the warranty and is responsible to discharge it, distributors just provide contracted service to the company to act as their agents in a given territory. At least that is my laypersons understanding.

 

[TSAVJason]

Agreed. Are distributorships structured so that extending warranty service eats into the profit for the distributor?

Absolutely! Distributors would make very little as it is but when they waste everyone’s time trying to hang on to a few dollars they seem quite petty. The manufacturers do provide support to the distributors but I see quite a few distributors that seem quite insensitive to the end user. This is a big part of why I say the dealer should be the advocate for the consumer. The dealer makes almost as much as the manufacturer and is being paid to take care of the customer. That said, when dealers discount too low, it’s a very common scenario to hear about a dealer telling the consumer to contact the manufacturer or distributor for service. This typically happens when the dealer elected to sell so cheap that it’s not worth giving the consumer service. This is entirely the dealer causing the poor service.

Really you’re right, we don’t know. The headfier is giving us 1 side of the story. There are always at least 3 sides to every story. So for us to assume the manufacturer is at fault right out of the box is not as reasonable an assumption as you may think.

I have my issues with Focal, I’m not their advocate or protector but I know enough to know that many statements made here on headfi are pure assumptions with little to no fact to support some of the silly crap said here.

 

[Sonic Defender]

Absolutely! Distributors would make very little as it is but when they waste everyone’s time trying to hang on to a few dollars they seem quite petty. The manufacturers do provide support to the distributors but I see quite a few distributors that seem quite insensitive to the end user. This is a big part of why I say the dealer should be the advocate for the consumer. The dealer makes almost as much as the manufacturer and is being paid to take care of the customer. That said, when dealers discount too low, it’s a very common scenario to hear about a dealer telling the consumer to contact the manufacturer or distributor for service. This typically happens when the dealer elected to sell so cheap that it’s not worth giving the consumer service. This is entirely the dealer causing the poor service.

Really you’re right, we don’t know. The headfier is giving us 1 side of the story. There are always at least 3 sides to every story. So for us to assume the manufacturer is at fault right out of the box is not as reasonable an assumption as you may think.

I have my issues with Focal, I’m not their advocate or protector but I know enough to know that many statements made here on headfi are pure assumptions with little to no fact to support some of the silly crap said here.

Thanks Jason, I'm trying to understand the relationships at play here, and yes, I will agree that it can't simply be assumed the manufacturer is at fault (although I still contend they have to be the ultimate protection for the customer where product warranty is concerned). So moving away from that question is that what happens if you accept a distributorship you become responsible to also fund the warranty part? If so, does the company not eventually get billed by the distributor? I'm sure there are different relationships possible, but typically how does it go?

It just sounds like too much is left to chance as you say, the dealer can be the problem if they sell for so low. So when a customer buys a headphone from an authorized dealer, who is legally required to pay for the warranty service?

 

[TSAVJason]

Thanks Jason, I'm trying to understand the relationships at play here, and yes, I will agree that it can't simply be assumed the manufacturer is at fault (although I still contend they have to be the ultimate protection for the customer where product warranty is concerned). So moving away from that question is that what happens if you accept a distributorship you become responsible to also fund the warranty part? If so, does the company not eventually get billed by the distributor? I'm sure there are different relationships possible, but typically how does it go?

It just sounds like too much is left to chance as you say, the dealer can be the problem if they sell for so low. So when a customer buys a headphone from an authorized dealer, who is legally required to pay for the warranty service?

Sort of. The manufacturer gives the distributor an allowance to cover the expense up front. So it’s money the distributor gets in advance of any issues. Also if there happened to be an extra high failure rate, the manufacturer will typically step up and reimburse the distributor for those unexpected costs. Now I’m not using the exact terminology but only because I’m trying to make it easier to understand.

I should add that if the failure of the product is really low or never happens, the distributor generates more profit because he gets to keep the allowance.

Make sense?

 

[Sonic Defender]

Sort of. The manufacturer gives the distributor an allowance to cover the expense up front. So it’s money the distributor gets in advance of any issues. Also if there happened to be an extra high failure rate, the manufacturer will typically step up and reimburse the distributor for those unexpected costs. Now I’m not using the exact terminology but only because I’m trying to make it easier to understand.

Make sense?

It does, and that is what I would expect, or some kind of account reimbursement for warranty expenses the distributor incurred. It does seem then that the dealers do the very best out of the deal, but I assume the distributor doesn't have to buy the stock, they simply handle it whereas a dealer typically would have to buy their inventory and the extra margin would go to covering their cost of borrowing. This still does make me wonder why the distributor would not have a vested interest in keeping the customer happy during warranty issues if essentially they aren't paying out of pocket. Now I suspect in the real world a distributor may "spend" the money provided to cover warranty claims on other business needs hoping that they don't have to really honour warranty issues, or at least very few. So if a distributor had already used up their money it might be why they drag their heals on providing service. Maybe waiting for the date when the company tops up their warranty coverage funds? That would be crappy.

I wonder in this case did @Tassie Devil ever contact Focal directly to complain about the extremely slow service? Ultimately if the consumer doesn't stand up for their rights they may get trampled on. I know for me that after 3 months I wouldn't have been dealing with my dealer or distributor, I would have gone right to Focal and asked them to crack the whip.

 

[koover]

Interstesing conversation to say the least. I do wish I wasn’t at work as I’d really like to converse, instead of a single post.
Cliff notes version though....ALL business is the same and relevant not matter what the product like is, what warranty work must be performed, what backend money is at play or who the owner/distributor/manufacturer is. Bottom line, you represent that brand and your reputation is at stake. Plain and simple.

What I will say and it’s old school but still rings true today, whoever’s name is on the “sign” that is representing a brand, it’s their responsibility to satisfy the customer.
I’ve been in business for 40+ years and nothing is more important than satisfying the customer, “almost” at all costs.
Understand, my post is not in response to
anyone specifically but just general.

The first thing I learned when I was a youngster at 18, no matter what, even if the customer is wrong, they’re right and you make good....as long as they’re not trying to rip you off. So what if you have a setback and lose a bit of profit. Even if your an upstart, that’s part of the price of doing business.

How much are you going to gain into the future with that great word of mouth or just return business if you don’t take care of the customer? Is it worth it to pound your chest and say I was right, saved a few bucks and be happy with that decision? It’s about word of mouth and return business and what kind of experience the customer had THAT DAY!

If I have an issue with a product I bought may it be defected and requires warranty work or replaced and it was at, say Best Buy?.... I couldn’t care less who’s fault it is as I want it fixed or replaced and not have to wait 7 months. That’s absolutely mind blowing and Best Buy would NEVER get a penny of mine, my family, friends, Co workers or business partners money again. I don’t want to hear your excuses Best Buy! Just fulfill your obligation on a transaction where money went from my hands into yours. Sure you can tell me the process of the warranty repairs, but bottom line, you sold it to me and that’s all that matters. Your name is on the sign in front of the building, not the company that is handling the wartenty work.

 

[TSAVJason]

It does, and that is what I would expect, or some kind of account reimbursement for warranty expenses the distributor incurred. It does seem then that the dealers do the very best out of the deal, but I assume the distributor doesn't have to buy the stock, they simply handle it whereas a dealer typically would have to buy their inventory and the extra margin would go to covering their cost of borrowing. This still does make me wonder why the distributor would not have a vested interest in keeping the customer happy during warranty issues if essentially they aren't paying out of pocket. Now I suspect in the real world a distributor may "spend" the money provided to cover warranty claims on other business needs hoping that they don't have to really honour warranty issues, or at least very few. So if a distributor had already used up their money it might be why they drag their heals on providing service. Maybe waiting for the date when the company tops up their warranty coverage funds? That would be crappy.

I wonder in this case did @Tassie Devil ever contact Focal directly to complain about the extremely slow service? Ultimately if the consumer doesn't stand up for their rights they may get trampled on. I know for me that after 3 months I wouldn't have been dealing with my dealer or distributor, I would have gone right to Focal and asked them to crack the whip.

Well that’s something he knows and we don’t. This is why I say it’s not a good thing to place the fault or responsibility on the manufacturer. In most cases they have and will perform IF they know about it. When Focal had a cheesy distributor in Hong Kong and customers were contacting us to find out what recourse they had, I called Focal, gave them the customers email and Focal stepped up. Until I told Focal about it that had no idea. The distributor was the problem and eventually was terminated as a distributor. A manufacturer can only take care of things they are made aware of.

This is a difficult thing to understand but really the dealer he bought the unit from should have been pushing for the customers benefit. In most cases we discover it’s the dealer not taking the service they were paid to perform seriously enough to provide the customer care they deserve.

 

[theorist]

Just in defence of 'good' Australian distributors, with a very satisfied story.

I live in New Zealand. A couple of years ago I brought my Moon 430HA headphone amp. It came with a ten year warranty from the then NZ distributor (but if you go to the Canadian Moon website this is at the discretion of the local distributor). Anyhow a few weeks ago it died overnight without the fuses failing. Contacted my excellent retailer, who said that there was a new distributor, based in Australia and that they would check with them for instructions. I went 'gulp' will my 10 year warranty even be honoured? Anyhow my retailer came back to me the next working day with a local repair shop which would do the warranty work. Dropped it off and got it back about three working days later with a failed inverter replaced on the multi-layered board. Very impressed all round!

 

[TSAVJason]

Interstesing conversation to say the least. I do wish I wasn’t at work as I’d really like to converse, instead of a single post.
Cliff notes version though....ALL business is the same and relevant not matter what the product like is, what warranty work must be performed, what backend money is at play or who the owner/distributor/manufacturer is. Bottom line, you represent that brand and your reputation is at stake. Plain and simple.

What I will say and it’s old school but still rings true today, whoever’s name is on the “sign” that is representing a brand, it’s their responsibility to satisfy the customer.
I’ve been in business for 40+ years and nothing is more important than satisfying the customer, “almost” at all costs.
Understand, my post is not in response to
anyone specifically but just general.

The first thing I learned when I was a youngster at 18, no matter what, even if the customer is wrong, they’re right and you make good....as long as they’re not trying to rip you off. So what if you have a setback and lose a bit of profit. Even if your an upstart, that’s part of the price of doing business.

How much are you going to gain into the future with that great word of mouth or just return business if you don’t take care of the customer? Is it worth it to pound your chest and say I was right, saved a few bucks and be happy with that decision? It’s about word of mouth and return business and what kind of experience the customer had THAT DAY!

If I have an issue with a product I bought may it be defected and requires warranty work or replaced and it was at, say Best Buy?.... I couldn’t care less who’s fault it is as I want it fixed or replaced and not have to wait 7 months. That’s absolutely mind blowing and Best Buy would NEVER get a penny of mine, my family, friends, Co workers or business partners money again. I don’t want to hear your excuses Best Buy! Just fulfill your obligation on a transaction where money went from my hands into yours. Sure you can tell me the process of the warranty repairs, but bottom line, you sold it to me and that’s all that matters. Your name is on the sign in front of the building, not the company that is handling the wartenty work.

Well Mr Old School, you’re likely way younger than I am but you’re right, the business that sold the item should be the consumers first line of defense and customer experience. The number #1 complaint we hear is the dealer just sending the distributors or manufacturers contact info so the consumer is now on their own. I find this DEPLORABLE from a dealer. What’s odd is that it tends to be the online only guys with the lowest overhead that treat consumers so poorly.

 

[Sonic Defender]

Just in defence of 'good' Australian distributors, with a very satisfied story.

I live in New Zealand. A couple of years ago I brought my Moon 430HA headphone amp. It came with a ten year warranty from the then NZ distributor (but if you go to the Canadian Moon website this is at the discretion of the local distributor). Anyhow a few weeks ago it died overnight without the fuses failing. Contacted my excellent retailer, who said that there was a new distributor, based in Australia and that they would check with them for instructions. I went 'gulp' will my 10 year warranty even be honoured? Anyhow my retailer came back to me the next working day with a local repair shop which would do the warranty work. Dropped it off and got it back about three working days later with a failed inverter replaced on the multi-layered board. Very impressed all round!

That's the kind of service I like to hear about, and frankly expect. Thanks for sharing.

 

[TSAVJason]

Just in defence of 'good' Australian distributors, with a very satisfied story.

I live in New Zealand. A couple of years ago I brought my Moon 430HA headphone amp. It came with a ten year warranty from the then NZ distributor (but if you go to the Canadian Moon website this is at the discretion of the local distributor). Anyhow a few weeks ago it died overnight without the fuses failing. Contacted my excellent retailer, who said that there was a new distributor, based in Australia and that they would check with them for instructions. I went 'gulp' will my 10 year warranty even be honoured? Anyhow my retailer came back to me the next working day with a local repair shop which would do the warranty work. Dropped it off and got it back about three working days later with a failed inverter replaced on the multi-layered board. Very impressed all round!

Please don’t misunderstand no one is saying all your distributors suck. I personally agree 7 months is way out of line. I am defending Focal in that I’m pretty sure they did as good or better than their obligations required of them.

In fact, the US loves Australia and those awesome caves you have in New Zealand. New Zealand has one of the most unique car cultures I’ve ever seen.

 

[koover]

Well Mr Old School, you’re likely way younger than I am but you’re right, the business that sold the item should be the consumers first line of defense and customer experience. The number #1 complaint we hear is the dealer just sending the distributors or manufacturers contact info so the consumer is now on their own. I find this DEPLORABLE from a dealer. What’s odd is that it tends to be the online only guys with the lowest overhead that treat consumers so poorly.

Lol.
Highly unlikely as I’m 58. If your older, you’re still young anyway. I’ve been in business for 40+ years and it’s really a very simple philosophy. Treat the customer the way you want to be treated and never let them leave your establishment unhappy may it be personally or online. Too may businesses are so shortsighted and don’t do any long range planning. They don’t realize your actions today will greatly affect your bottom line Tomorrow.

 

[TSAVJason]

Lol.
Highly unlikely as I’m 58. If your older, you’re still young anyway. I’ve been in business for 40+ years and it’s really a very simple philosophy. Treat the customer the way you want to be treated and never let them leave your establishment unhappy may it be personally or online. Too may businesses are so shortsighted and don’t do any long range planning. They don’t realize your actions today will greatly affect your bottom line Tomorrow.

Thx but I have you by a decade. At least we agree on how a customer should be treated.

 

[Whitigir]

Lol.
They don’t realize your actions today will greatly affect your bottom line Tomorrow.

I didn’t realize that marrying my wife would affect my bottom line today and tomorrow