http://www.moderco.com/forums/forum/318-2/

Would you rather have a “warranty” or a “guarantee” when it comes to product protection?

The party of the first part herein “warrants/guarantees” to the party of the second part that if any part or portion thereof, of all of the parts that it supplies ever breaks, then the party of the first part wants no part of fixing or replacing it”.

This statement is obviously not part of any warranty/guarantee but in essence if you get into the real nuts & bolts of many warranties/guarantees this is what it is attempting to say. The moral of this entire piece is “Buyer beware – read the guarantee/warranty and all of its conditions BEFORE you buy”.

There are 3 terms – “warranty”, “limited warranty” & “guarantee” that you may encounter. Let’s see what they mean & what the differences are.

A “warranty” is an instrument designed to safeguard the rights of the customer. “Warranties” require payment on the part of the customer (Moderco distributor) to the seller (Moderco) to make it legal. The cost of Moderco’s “warranty” to its distributors is included in the quoted material price. The “warranty” then becomes part of the contract between the distributor and his customer with the distributor assuming responsibility for his portion of the contract such as on site storage, delivery, care & protection & installation. A “warranty” by legal definition of the word assures the customer that certain facts & conditions are true or will happen and if they do not then they will be legally entitled to seek remedy if what is warranted does not occur.

A “limited warranty” is a warranty as described above but with specific conditions contained in the warranty document that impose limitations on the liability of the seller to the customer usually based on care, use, maintenance etc.

A “guarantee’’ is a document also designed to protect consumers. It is a promise by a seller to a buyer that he (the seller) will assume product responsibility & will replace and/or repair defective parts of the purchased item over the period of time contained in the contract. It is a legal understanding and/or verbal, document even if the buyer does not pay for it and is typically offered free of charge by the seller (usually the manufacturer) to his customer (in Moderco’s case – usually a distributor).  With a “guarantee” the customer can get his money refunded or parts repaired for those component parts that are replaceable & defective. However it is much more difficult to enforce and rarely used in our industry. Many times it is simply someone giving someone else their “word”.

The main difference between “guarantee” & “warranty lies in the dissimilarity of expectations. Generally it is “believed” that one will receive compensation or satisfaction with the strength of a “guarantee” but maybe not. Warranty by its definition and the fact that it is purchased ensures that the customer will receive satisfaction and will have legal recourse should this not occur. There is a vast difference in the essence & spirit of “guarantee” and “warranty” which the customer must understand before expecting the benefits that such documents may offer.

The most common terminology in the operable wall industry is “limited warranty” which places conditions based on, use & abuse, the quality of the damage that has occurred, how & why, time frames etc. simply because walls are dynamic products that are designed to be relocated and maintained which greatly increases the probability of post installation damage. Many times the expectations of the ultimate consumer are reduced by the expressions & conditions used in the “limited warranty” document. It is imperative that the consumer understand the “limited warranty” and read more than just the period of time that is offered and assuming that he is fully protected.

Some examples of “terminology” & “conditions” that are found in some “limited warranties”.

“Seller warrants that its products sold shall be free from defects in workmanship and materials under normal use and service for the periods listed herein”

– Define “normal” And who defines normal?

“Products shall have a ??? warranty from date of shipment”

– Not from date of installation or final acceptance. From date shipped! So if the distributor buys and stores for 6 months or the product is installed & sit in pockets for 6 months as often happens on major projects then the consumers warranty period is effectively reduced by that period of time. When does the warranty start?

“ ——- sole obligation under the warranty is to repair or replace any defective parts found in the product”

– If parts are defective but the overall system does not perform up to what was expected and agreed to then there is no implied responsibility to make it work. If all of the “parts” work on a system that “does not work” then the warranty provisions have been filled. Is making the system work part of the warranty?

“——-systems must be lubricated at time of installation plus a scheduled maintenance program performed once a year consisting of  cleaning of track, ……………etc.”

–  In other words, if you don’t care for the system then the warranty is void which no one can argue with. But how many customers are aware of “scheduled maintenance programs” being required to keep warranty in force?

“ —– not covered by this warranty are finish materials, perimeter trim, seals & hardware”

– It would appear that the items most likely to fail are not covered

You get the idea. The moral of the story is to have your customer read the “warranty” before he issues a contract. 2 years or 5 years or 10 years is not enough other than providing a feeling of comfort. What is really covered is in the details and should be reviewed before contracts are issued in which the warranty period is part of the negotiation.