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How many people bought service plans?


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35 replies to this topic

#1 of 36 GeoffL

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Posted July 30 2002 - 03:49 AM

Hello.
I was about to buy a Projection Screen HDTV the other day, when the salesperson tried to scare me into buying a service plan. After a little bit of an arguement, I told him flat out that I was not intersted in buying the HDTV.

The wierd thing was that he kept on saying that the HDTV had to be serviced ever year. Posted Image

I asked him why anyone would want to buy a TV that had to be serviced every year?!!

Anyways, the service plan is $299. It just blew my mind. Anyone else buy a service plan? Should I buy one?

How often does a Projection Screen HDTV have to be serviced?

Thanks
whirley

#2 of 36 ColinM

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Posted July 30 2002 - 03:55 AM

Consider the investment, and cost of repair...

If your $3000 tv blows up after the MFG warranty expires, you'll be happy you got the extended service.

The yearly thing is likely just cleaning and maybe pro-level calibration.

Me? The only thing I have that's $$$ enough to warrant the extended warranty is my '96 Jeep Gr Cherokee. $1500 for bumper to bumper over 3 years - paid for itself in 3 months when the AC system needed to be replaced - in it's entirety.

I'd budget for an extended warranty on a projector / rptv.

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#3 of 36 jeff cr

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Posted July 30 2002 - 04:02 AM

i agree, basically it is piece of mind to know that if something goes wrong it will be covered. chances are nothing will go wrong but if it does it will pay for itself in no time.

#4 of 36 Andre F

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Posted July 30 2002 - 07:59 AM

When my Wega's screen started to turn green a few weeks back I was happy I purchased a service plan...
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#5 of 36 Lew Crippen

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Posted July 30 2002 - 08:23 AM

And for a (somewhat) dissenting opinion, let’s do the math:

Assume the cost of the RPTV(?) is $3,000. You are paying 10% per annum for peace of mind. Or 30% of the total cost if you plan on keeping the set 3 years. This is likely somewhat deceptive, as it is likely that the first year would be covered by warranty. So you would be paying 30% of the cost of the set for two years peace of mind.

Etc.

Just like most types of insurance, you pay a little all the time to avoid a one-time big hit. Only you can decide how to manage your money. I would observe that there is a reason that salesmen push these types of plans.

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#6 of 36 Dustin B

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Posted July 30 2002 - 09:12 AM

I don't know how accurate this is. But a friend of mine who works at a FutureShop was told by a manager that 80% of the money they bring in on extended warranties is pure profit to FutureShop. Only 20% of what is brought in on these warranties is actually ever needed to cover warranty repairs or replacements. And a fair chunk of the 80% goes directly to the salesman as commision (why they push it).
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#7 of 36 Merrill

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Posted July 30 2002 - 09:33 AM

It is absolutely pure profit for the seller (as all insurance is). However, if you have one repair, I'll bet it will be more than $300.

We bought a $3200 set and spent the $300. The selling point to me was it covered on-site visits. Even if it needed to be fixed, I won't know where to take it or how to get it there. I am one of the few people in the world that don't own a truck.

Not sure what the sales person was so pushy other than it's a big commission.
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#8 of 36 Greg Herzig

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Posted July 30 2002 - 01:22 PM

I bought a Toshiba 50H72 50 inch HDTV last month from best buy. The salesman was very persistant that I get the service plan. I can't speak from experience, but from what I have heard, they do not do professsional calibrations with their service plans.

I love my TV and it has a wonderful picture(due to Avia's DVD and my learning to set it's manual convergence).

Check out www.bestbuysux.org

There are a LOT of employees and customers that share their experiences with PSP's.

Good luck. BTW, I didn't get the plan.

#9 of 36 Lew Crippen

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Posted July 31 2002 - 04:29 AM

Quote:
It is absolutely pure profit for the seller (as all insurance is). However, if you have one repair, I'll bet it will be more than $300.


Of course. You also need to consider that you probably won’t needthe repair every year. That’s why I focused on three years. If you assume one fault every three years, the break-even point is a $900 repair.

Actually it’s more than that, if one figures in the time-value of money. The concept is that the same amount of money spent today is worth more than money spent in the future (due to loss of interest and inflation, among other things). This is not a terribly complicated bit of math, and the formula can be found in any beginning accounting book.

In the end, it's still a decision to hedge or gamble.


Quote:
The yearly thing is likely just cleaning and maybe pro-level calibration.


If you can get them to commit to yearly calibration, you can reduce the $300 by whatever that kind of calibration would cost in your area.
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#10 of 36 Mike Matheson

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Posted July 31 2002 - 06:27 AM

While I've heard salesman make service contracts sound enticing, the contract itself is often at odds with what the salesman is "guaranteeing" -- particularly regarding replacements vs. lengthy repairs and those "on-site" visits.

Not to mention assurances such as "you have to refill the gas in your plasma screen every year, and this service contract covers that".

Guess it may pay to actually READ the service contract. . .

#11 of 36 Carl Johnson

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Posted July 31 2002 - 06:38 AM

I used to be a salesperson @ Circuit City and they basically brainwashed me into believing that the extended service plan is more than just a good deal for the buyer, Circuit City is being generous in offering such a plan to their customers, who would have to be ignorant or dumb to pass on such an offer. Now that I look back on how many hundreds of dollars (if not a 1k) that I've spent on protecting gear that has been running flawlessly for the past five years I've done a 180 on service plans. I'd say it's a save bet that over a period of years the money spent on service plans will far exceed money that would have been spent on repairs. Besides, even if the television happens to break 3-4 years from now I'd rather have that $300 is my pocket to put tor wards a new set that will certainly be cheaper with better features than going thru the hassle of a repair.

#12 of 36 Bill_D

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Posted July 31 2002 - 07:31 AM

I never buy extended service on anything other than my vehicles. My personal experience has shown that their value is not equal to the purchase price.

Quote:
The wierd thing was that he kept on saying that the HDTV had to be serviced ever year.


I am curious if the plan that was being rammed down your throat offered included an annual vacuuming out preventative maintenance visit or if it only covered manifested problems.

#13 of 36 JayDaniel

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Posted August 01 2002 - 01:56 AM

Everything in life is a tradeoff - risk vs. reward.

In general I do not buy extended warranties. But I am a big proponent of using AMEX, or other credit cards, that offer FREE OF CHARGE, extended warranties and protection from theft, accidents, etc. And no, I'm not affiliated with AMEX in any way.

AMEX provides FREE a one year extension, parts & labor, of the manufacturer's warranty. Few things in life are free, but this comes close.

Here's a quote from their site:

"Receive coverage for damaged or stolen purchases - at no additional charge
When you use the Card for everyday purchases, the Purchase Protection Plan†† provides you with added peace of mind. Eligible purchases made entirely with the Card are protected against theft or accidental damage for 90 days from the date of purchase—at no additional charge. Coverage is good for up to $1000 per occurence and $50,000 per Cardmember account per year. For more information or to file a claim, call 1-800-322-1277

Extend the warranty on purchases—at no additional charge
When you shop with the Card, you can put off worrying about repair bills for up to one additional year. When you purchase eligible merchandise entirely with the Card, the Buyer's Assurance Plan‡‡extends the terms of the original manufacturer's warranty up to one additional year on U.S. Warranties of five years or less-at no additional charge. Learn More."

Here's the link:
http://home3.america....ns.asp?card=18

Good luck.

JayDaniel

#14 of 36 Ted Lee

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Posted August 01 2002 - 03:33 AM

like any other insurance you buy, you hate to pay it but are darned glad you have it if something goes wrong.

someone munched my car. by the time i was done getting it fixed, it was probably pretty close to 4k. that included rental insurance so i could drive a cool SUV for a week or so. what if i didn't have insurance? i would have been hosed!

i worked for both cc and gg. yes, they really push the warranties. iirc, someone once told me that approximately fifty percent of cc's profits come from those warranties. so you better believe management gets a raging boner whenever their employees sell those things. stores that do well on esp get additional bonuses.

but, i always say, if this thing breaks two years from now, you will be very happy you spent that three hundred dollars. i always equated it to a tradeoff scenario. yes, this warranty is 300 dollars. but, will you eat at a nice restaurant about 20 times in the next three years? would you rather protect for 4K tv for the same amount of money?

it's all about peace of mind...you have to decide if it's worth it to you. i rarely buy warranties, but on a 4k tv, i would probably think about it...
 

#15 of 36 Trey Jones

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Posted August 01 2002 - 11:45 AM

I purchased my Toshiba 57HX81 from Conn's in Austin, TX. I bought the $400 maintenance plan and it did come with 6 month cleanings and calibration.

Since I had just did a calibration on my set, I had the guys come anyway, and they came with a grid for my television. Nonetheless, the calibration was very worthwhile. Cleaning, well, it wasn't dirty Posted Image
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#16 of 36 Brad_V

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Posted August 01 2002 - 08:55 PM

People tend to get on me sometimes for daring to recommend analog projection TVs to some people based on their needs, but this is a part of why. Who would bother with a $300 service plan when the TV only costs $1400 and any mom-and-pop store can fix the thing?

Another problem with service plans is sometimes you have to fight for it to be fixed right or to be covered under the warranty anyway.

If a TV fails in under four years, that's just plain bad luck. After four years when the warranty is done, it's already living on borrowed time. And if it goes out during the first years, a 2-3 year-old projection TV is worth a lot less nowadays than it used to be.

In some cases, there are very good reasons to get a warranty. But in most cases, not really.

#17 of 36 DanaA

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Posted August 01 2002 - 09:58 PM

Personally, I avoid extended service contracts like the plague. That said, my RPTV cost a bit over $3400, so this time I purchased one. I've also heard that the extended warrantys are mostly profit for the dealer, but that also means there is quite a bit of negotiating room. In my case, It ended up costing, if I'm recalling correctly, $199 for a five year plan, but only after I threatened to void the deal if it wasn't thus reduced. I figured that for my peace of mind, it was worth it. Now, I hope the thing explodes, 4 years and 364 days after I bought it, so that I can get a free replacement of whatever comparable model is being sold then. Posted Image

#18 of 36 Jason Edgecombe

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Posted August 02 2002 - 06:40 AM

I was at Best Buy to pick up a $100 VCR that I saw in their Sunday flyer. Before I could get to the register, a sales person was on my case trying to get me to buy an extended warranty... for $40 on a $100 VCR!

I might think about buying an extended warranty of a large purchase, but read the warranty first because you'll probably be surprised about some of the things that are in it. For instance, the warranty probably allows them to assign your service contract to a third party dealer and what happens if that dealer goes out of business? Also, if the salesman tells you something like on site visits or yearly calibration is included, make sure it's in the contract - if it isn't, the contract undoubtably disclaims any express warranty made by the salesman, and then you're hosed and the salesman is laughing all the way to the bank.

I would also never buy extended service from BB or CC as there seems to be too many hastles to get service.

#19 of 36 Ted Lee

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Posted August 02 2002 - 06:51 AM

oh yeah...i forgot to mention one somewhat "useful" feature of warranties.

at least while i was working, they had a "no lemon" policy on these warranties. essentially, if you have the same problem with your component three times, on the fourth time they automatically replace it for you.

the obvious benefit is that after two or three years...the thing you just bought won't be available. they'll give you the equivalent current model - which is usually better anyway.

i know for sure some people have made....ummm....let's just say "beneficial use" of this policy.

ted
 

#20 of 36 Lew Crippen

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Posted August 02 2002 - 10:01 AM

Quote:
extended warranty... for $40 on a $100 VCR!
Here’s another that just happened to me. Salesman tried to sell both and extended warranty that provided protection in case of power fluctuations and a surge protector.

And I don’t think that he was being malicious, as he had just started work. I’m sure that he was doing what he was told: sell the warranty and sell some add-ons.

Quote:
the thing you just bought won't be available. they'll give you the equivalent current model -
I have to admit that benefit had not occured to me.Posted Image
¡Time is not my master!


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