dennis yang dot com

So this whole Herman Miller conundrum has gotten me thinking about the whole warranty thing more…

I did a little quick research and actually found that the Herman Miller guy was right — most warranties that you find on products out there do seem to be non-transferrable once the product is resold..

Upon quick glance, both Steelcase and La-Z-Boy also have this warranty policy — and, this is also a common warranty policy amongst consumer electronics manufacturers like Canon.

By only honoring warranties to the original purchasers from authorized dealers, Herman Miller is able to create tiers of pricing for its products. A new Aeron chair from an authorized dealer costs $679. From an non-authorized dealer, it costs $574.. And, voila.. the value of the manufacturer warranty? $105. That said.. the *retailer* offers a 12-year warranty on those chairs. Update: Ok, Amit correctly pointed out that included in this $105 is also a guarantee that the product is “genuine.” Ok, I’ll give you that, I suppose.

Man, this is getting complicated.

Interestingly, a pre-owned Aeron, with a 12-year warranty (not from Herman Miller, but provided by the retailer) costs $549. So, in reality, the “newness” of an Aeron is only worth about $25.

And, a quick search on Craigslist puts the street value of a used, no-warranty Aeron chair at about $450.. once again.. the value of a 12-year warranty at all? another $99.

So, the true price of a brand-new, authorized Aeron Chair?

$450 for the chair
$25 for one that nobody else’s butt has sat in
$99 for the 12-year warranty
$105 to have that warranty serviced by Herman Miller themselves, and guarantee that the product is “genuine”

Fascinating.

Anyway, I still think that the sentiment on the Herman Miller site
is a bit disingeniuous:

The Herman Miller Warranty is a statement of our confidence in the quality of our products. It’s a straightforward promise to our customers that we stand behind that quality, 100 percent–100 percent of the time.

That said, I think I get it now. It still seems very shady, but doing warranties this way allows for manufacturers to create the “grey market” for their goods — which may create a bigger overall market for their products. It allows them to effectively sell products to consumers at a cheaper price and differentiate those products with a weaker (or non-existent) warranty. I only wish that the Herman Miller dude would explain it this way to me instead of just using the “well that’s the way we’ve done it since the company was founded” excuse…

This entry was posted on Thursday, July 23rd, 2009 at 12:22 am and is filed under ramblings. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.