Warranty return rate

[Conductor562]

All this talk about Warranties and what not prompted me to look up a few warranty terms. While checking out Wilde's warranty I noticed they state their warranty return rate over the last decade was .000635% . They were the only manufacturer I found that was so open with their numbers, but it got me really curious as to what they might be. I would have to believe that the truck brand manufacturers and the store brands would be much higher, but even at 20 times that we're talking less than 1 half of 1%. Even at 100 times higher we're still talking less that 1%. For me it really calls into question how much warranties are really costing the manufacturer.

Here's the link: http://wildetool.com/facts.cfm

 

[pipsters]

I've wondered that as well. That being said you can't just walk into a Sears and get a Wilde pry bar warrantied. Shipping it back is probably cost prohibitive. Much easier to do with a Craftsman socket.

I get 75% FedEx discount and shipping still costs quite a bit...

 

[kunkernator]

I think they advertise the number almost to brag that their tools are so good they do not need to be warrantied. If Sears did that........

 

[Conductor562]

The linked page states 65-80% of Wilde's business is rebranded items for other manufacturers. Even if you're returning it through the re-brander it's eventually making it back to Wilde. I know they make the majority of retaining ring pliers on the market, and after looking, those Wilde pry bars sure look a lot like my Proto branded ones.

 

[General Geoff]

It is in the best interest for the manufacturer to build their tools as strong and as defect-free as possible, to avoid warranty replacements. It would not surprise me if most quality tool manufacturers have a warranty claim rate of 0.5% or less.

On the other hand, certain specific products probably have much higher percentage rates of return, namely ratchets, breaker bars, and exceedingly common fastener-size sockets like 10mm.

 

[Mohawk Dave]

got me interested in Craftsman profits..haven't found it yet, but $3B revenue a year from C-Man.

And now that I think about it, out of the hundreds of people I know that have/have bought C-Man, There is maybe only 10 of us that will actually drive to a Sears and exchange/warranty it. Most don't realize K-Mart/Ace will do it.

Most of these guys either throw the tool into the bushes, trash can, or bottom of the junk bin and just buy whatever at Home Depot. My point is, tool guys, like us here on GJ, are not as common as we sometimes think.

Here is a quote from the link. "As for Sears stores, more shoppers still buy a hammer or wrench at Sears than any other retailer by far. Sears dominates the hand tool market with a 35 percent share, followed by Home Depot with 15 percent and Lowe's with 13 percent, said Stevenson TraQline. In power tools, Home Depot leads with 26 percent, followed by Lowe's at 20 percent and Sears at 17 percent. Sears has been carrying Craftsman tools since 1927, when it paid $500 for the rights to the name from the Marion-Craftsman tool company. Craftsman's power historically has been in drawing shoppers to Sears stores, rather than in contributing to the bottom line. Craftsman tools generated about $3 billion of Sears Holdings' $43 billion in revenue last year, analysts estimate."

link.http://community.craftsman.com/topics/Craftsman-Tools-at-Costco/posts?page=2

 

[Conductor562]

All factors considered, and with such a large market share, I don't doubt for a second that Craftsman has the highest return %, but even then I can't imagine it being over 1-2%. Kinda gives you a different perspective on Sear's sighting "warranty obligations" as a contributing factor in the decision to offshore.

 

[03protege]

The linked page states 65-80% of Wilde's business is rebranded items for other manufacturers. Even if you're returning it through the re-brander it's eventually making it back to Wilde. I know they make the majority of retaining ring pliers on the market, and after looking, those Wilde pry bars sure look a lot like my Proto branded ones.

I do believe they make the Craftsman prybars.

 

[03protege]

All factors considered, and with such a large market share, I don't doubt for a second that Craftsman has the highest return %, but even then I can't imagine it being over 1-2%. Kinda gives you a different perspective on Sear's sighting "warranty obligations" as a contributing factor in the decision to offshore.

We also do not know if they count the rebranded items as part of there return ratio, if they do not it would make sense that it is so low as dealing with the RMA process plus shipping could be more expensive than buying another unit.

Regardless, their return ratio seems to be silly low.

 

[pipsters]

I know I personally had to exchange about 40 sockets from the 299 pc Craftsman set due to defects ranging from improper detents to rust on new sockets to cracks in the forging and flaking chrome.

More an issue of a lack of quality control.

On a side note my local Sears has 1/2" 12 point Chinese socket sets in it.

 

[Conductor562]

I do believe they make the Craftsman prybars.

They do bare a striking resemblance to the Craftsman's and probably a bunch of others as well.

 

[pipsters]

The wilde prybars are nice but you can't hammer on them like you can the Craftsman Pros / Mayhews.

 

[03protege]

got me interested in Craftsman profits..haven't found it yet, but $3B revenue a year from C-Man.

And now that I think about it, out of the hundreds of people I know that have/have bought C-Man, There is maybe only 10 of us that will actually drive to a Sears and exchange/warranty it. Most don't realize K-Mart/Ace will do it.

Most of these guys either throw the tool into the bushes, trash can, or bottom of the junk bin and just buy whatever at Home Depot.

My point is, tool guys, like us here on GJ, are not as common as we sometimes think.
​

Besides the fact that we GJ'ers are more likely to exchange a tool, I believe we are also more likely to wear it out in the first place.

BUT I bet outside this crowd a lot more tools do break due to neglect and misuse.

 

[03protege]

They do bare a striking resemblance to the Craftsman's and probably a bunch of others as well.

This video was posted here before.

Its short and a fun watch but check out around the 1:24 mark

 

[Conductor562]

This video was posted here before.

Its short and a fun watch but check out around the 1:24 mark

I guess the cat's out of the bag huh?

 

[03protege]

I guess the cat's out of the bag huh?

Haha yeah, I wonder if someone saw that later and had a "OH ****!" moment.

I like how Wilde uses the EXACT same handles as the other brands they relabel. I plan on getting the scrapers from Wilde, same handle design and cheaper than Craftsman off of Harry J

 

[chadster1]

All factors considered, and with such a large market share, I don't doubt for a second that Craftsman has the highest return %, but even then I can't imagine it being over 1-2%. Kinda gives you a different perspective on Sear's sighting "warranty obligations" as a contributing factor in the decision to offshore.

My warranty percentage for 2012 was 11.99%

 

[pipsters]

Haha yeah, I wonder if someone saw that later and had a "OH ****!" moment.

I like how Wilde uses the EXACT same handles as the other brands they relabel. I plan on getting the scrapers from Wilde, same handle design and cheaper than Craftsman off of Harry J

They don't. The Wilde pry bars have an almost purple handle on them. Craftsman is bright red. I sold my big 36" wilde pry bar because of the purple handle and bought the Craftsman one.

 

[Conductor562]

The site admin over at Tools in action saw a Dewalt promo video one time that clearly showed an 18V cordless miter saw that Dewalt did not sell. He posted the video on the blog and within an hour Dewalt took the video down.

 

[Conductor562]

My warranty percentage for 2012 was 11.99%

Wow, that's higher than I would have expected. Was that in all categories collectively?

 

[03protege]

They don't. The Wilde pry bars have an almost purple handle on them. Craftsman is bright red. I sold my big 36" wilde pry bar because of the purple handle and bought the Craftsman one.

Maybe it is just hard for me to tell but if you look at the video I posted it appears at the 1:22 mark they have a barrel of handles that are the same red as the Craftsman and marked Wilde.

Also the scrapers have clear handles but of the same shape, I was mistaken.

 

[pipsters]

I bought my 36" Wilde bar from HE I think on July 4th IIRC of 2012. It had a purple handle. That video predates it...

 

[Conductor562]

Most Wilde branded stuff I've seen was red.

Purple tools? :supergay:

 

[03protege]

I bought my 36" Wilde bar from HE I think on July 4th IIRC of 2012. It had a purple handle. That video predates it...

Well I appreciate the heads up on what color to expect.

 

[pipsters]

Well I appreciate the heads up on what color to expect.

Maybe I got a fluke, or a NOS from HE, who knows.

 

[byoungblood]

I know I personally had to exchange about 40 sockets from the 299 pc Craftsman set due to defects ranging from improper detents to rust on new sockets to cracks in the forging and flaking chrome.

More an issue of a lack of quality control.

On a side note my local Sears has 1/2" 12 point Chinese socket sets in it.

But consider that for every one of you, there are probably 5000 others that will just take them out of the box and use them as is. In 10 years they'll all look the same anyway.

 

[durallymax]

I would think truck brands would be much higher because people buying them are more likely to warranty them as the truck is there often.

The other brands I think there is enough tools sold that just don't see the use which offsets the warranty some, then theres the fact many people don't even bother with many common things like $3 sockets. I know I always forget them but end up at the mall for something else and just buy a new one.

 

[Conductor562]

I would think truck brands would be much higher because people buying them are more likely to warranty them as the truck is there often.

The other brands I think there is enough tools sold that just don't see the use which offsets the warranty some, then theres the fact many people don't even bother with many common things like $3 sockets. I know I always forget them but end up at the mall for something else and just buy a new one.

I agree with that. I too expected the truck brands to be much higher for no reason other than the fact that they are most commonly used daily by professionals who typically buy their own tools whereas industrial brands are more often company supplied and often just discarded when broken. I didn't expect it to be nearly 12% though. I guess this is speculative math, but assuming that 12% served as an average against all sales were talking $12 on the hundred. If we assume a 2/3 mark-up (which I believe gives Snap-On the benefit of the doubt) were talking about an actual cost of 4% of sales being ******* in warranty returns which equates to $40,000 per $1,000,000 in sales for what has to be the most utilized warranty in the business. I just don't see warranties being a real burden.

 

[kythri]

All factors considered, and with such a large market share, I don't doubt for a second that Craftsman has the highest return %, but even then I can't imagine it being over 1-2%. Kinda gives you a different perspective on Sear's sighting "warranty obligations" as a contributing factor in the decision to offshore.

When did Sears cite any such thing?

 

[honcho]

My warranty percentage for 2012 was 11.99%

How is that percentage calculated? Is it 11.99% of the number of tools you sold that year or a percentage of the dollar value of tools sold/handled?

a 12% warranty return rate would be worrisome for any industry. Such a high number, if typical across all Snap-On dealers, either says that Snap-On tools are potentially (among many possible scenarios) 1. not so strong for their intended use, 2. used by abusive brutes who can break anything 3. fairly priced to accommodate the generous lifetime warranty

I still think that Lifetime warranties for hard hand tools are mostly just a cheap marketing gimmick because in so many situations, obtaining warranty service just isn't cost and time effective. A broken socket is irritating, potentially dangerous and can be costly if an expensive piece of equipment cannot be repaired in a timely manner but if you're working on a equipment worth millions that costs $thousands to operate, warranty replacement on a $30 tool is nice, but hardly meaningful in the big picture.

In the 90s I worked on a project in a remote location where we chartered a plane for about $5k to bring in a $100 circuit board that was holding up progress. Time is money and even if that $100 circuit board had a gold field service replacement warranty, such a warranty would have been worthless at that point in time.

I just believe lifetime warranties, while nice to offer, aren't really worth much

 

[trainer]

Something to think about is that if sears does $3 billion a year in sales on the craftsman brand and the warranty costs .5%, then that's still $15 million in costs. Not too many business are big enough to ignore that kind of an expense.

 

[Hootbro]

Warranty return rate does not tell the whole story. Depending on the warranty return policies, it can just be cheaper by the end user to just chuck it in the trash.

 

[woody 73]

:

Something to think about is that if sears does $3 billion a year in sales on the craftsman brand and the warranty costs .5%, then that's still $15 million in costs. Not too many business are big enough to ignore that kind of an expense.

Very interesting But then again how much mark-up is it costing sears to buy 100,000 of the same size socket that they are selling for say $3.99 ?

I am thinking pennies on the dollar for just that one socket...

 

[durallymax]

How is that percentage calculated? Is it 11.99% of the number of tools you sold that year or a percentage of the dollar value of tools sold/handled?

a 12% warranty return rate would be worrisome for any industry. Such a high number, if typical across all Snap-On dealers, either says that Snap-On tools are potentially (among many possible scenarios) 1. not so strong for their intended use, 2. used by abusive brutes who can break anything 3. fairly priced to accommodate the generous lifetime warranty

I still think that Lifetime warranties for hard hand tools are mostly just a cheap marketing gimmick because in so many situations, obtaining warranty service just isn't cost and time effective. A broken socket is irritating, potentially dangerous and can be costly if an expensive piece of equipment cannot be repaired in a timely manner but if you're working on a equipment worth millions that costs $thousands to operate, warranty replacement on a $30 tool is nice, but hardly meaningful in the big picture.

In the 90s I worked on a project in a remote location where we chartered a plane for about $5k to bring in a $100 circuit board that was holding up progress. Time is money and even if that $100 circuit board had a gold field service replacement warranty, such a warranty would have been worthless at that point in time.

I just believe lifetime warranties, while nice to offer, aren't really worth much

The tool truck brands are worth it for the warranties. The store brand ratchets and such grenade and people buy new ones. I bet half of the warranties on tool trucks are ratchets and bit sockets.

The liftetime warranty is worth it. I bought a used KRL7023 Snap on box of CL for $2,800. Brought it home and got $1,700 worth of warranty parts for it. Essentially had a brand new box again, aside from a couple scratches.

 

[sberry]

I want to get back to reading this, good info, I bet the warranty rate for Cheap tools is real low too, some due to the fact it isnt worth the effort when replacement is so cheap but still...............

 

[Davefr]

The liftetime warranty is worth it. I bought a used KRL7023 Snap on box of CL for $2,800. Brought it home and got $1,700 worth of warranty parts for it. Essentially had a brand new box again, aside from a couple scratches.

Those days are now over unless you have original proof or purchase.

 

[03protege]

:

Very interesting But then again how much mark-up is it costing sears to buy 100,000 of the same size socket that they are selling for say $3.99 ?

I am thinking pennies on the dollar for just that one socket...

We also do not know Craftsman's agreement with Apex tools. Apex could be taking on the hit from the returns.

 

[trainer]

:

Very interesting But then again how much mark-up is it costing sears to buy 100,000 of the same size socket that they are selling for say $3.99 ?

I am thinking pennies on the dollar for just that one socket...

Imagine that they have to buy 100,000 of 100 different sizes sockets. Even at say 25¢ average cost per unit , thats still $2.5 million ******* in inventory.

By the time you figure in labour, cost of operating stores and distribution centres, for an open stock item that is probably a very slow seller, the profit margins are quite a bit less than you think.


And open-stock sockets are mainly stocked in stores so that they can do warranty on ones that were originally sold in a set.

 

[Conductor562]

When did Sears cite any such thing?

In one of the dozens of threads on the subject, a GJ member emailed Sears about the offshoring and the CSR cited it in her reply as a contributing factor. Something along the lines of "in order to continue offering the warranty our customers expect". Don't ask which thread, because there have been so many, but it was there.

 

[Conductor562]

When did Sears cite any such thing?

Found it. Post #1: http://http://www.garagejournal.com/forum/showthread.php?t=181081