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I was talkin’ with an elctrician about his standard contract, pickin’ his brain, and he says, “see that clause about my warranty? That’s the most important part of your contract. I warranty my work for 1 year. (it was clearly written) If you don’t specify your warranty, they automatically get 12 years to ciome back on you.”
Now, I’m sure it varies from state to state (and Province of course), but 12 years seems like a long time. What are your experiences about this? Do all you folks specify your warrenty? How long is it? 1 year doesn’t seem like he’s taking responsibility for his work. What is the industry standard? Thanks – Jim
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Jim;
Down here in the South, 1 year warranties are pretty much standard(assuming the builder is still in business),at least in metro Atl. and surrounding areas. Any further warranties are usually a customer option thru a third-person service.
This is not to say that a reputable builder won't stand behind his work. I'm still working with a customer that closed 2 years ago on keeping water out of his NW(prevailing wind and storm direction) view walls, even though he insisted on using shop-built wood doors and windows to cut costs on his 2600 sft. timber-frame home(he later added a finished basement for appr. $15K, more than enough to pay for the premium clad units we recommended).
We provide a year's warranty and clearly state it in our contracts. Our subs all offer a year's warranty on their work, as well as the mfg. warranty on all equipment(A/C compressors, hot-water heaters, etc.) Never heard of this 12-year implied obligation. Of course, we retain all the manufacturer's warranty info for our customers and pass it on at closing.
I'm not sure what I'm trying to say(to quote Jackson Browne). I guess, if you're a builder worth the name, you'll be concerned with your product no matter what warranty you offer. Personally, we build quality homes for a selected clientele, and I don't want any of our customers to ever think they didn't get what they paid for. If they do, I haven't done my job.
Hope I've been of some help.
Bill
*Jim, your friend is right. Only here in Tennessee, the implied warranty is 7 years and a 1 year repose. We offer a one year warranty purchased through our local home builder association.
*One year is standard in cabinetry, as far as I know. That's what I offer (written in the contract), hardware is covered under the manufacturers warranty. But, within reason, if I made it,and it fails through my work, it's covered.
*Jim,Yep, from what I hear most states have a fairly long period of time that is in effect unless you specifically offer your own warranty in the contract. I'm no legal eagle, just heard this on the grapevine. Here in Missouri, we are on the hook for 10 years according to "free lunch at lumberyard gossip". I am not sure how this statute is brought to bear, through lawsuit like everything else these days I guess. A year warranty is pretty standard around here for those who are aware that the state has seen fit to create fairly extraordinary standards. Many of those laws come from a time when houses were less complicated and not filled to bursting with mechanical systems and sub-systems, all things that can lead to problems sometimes way out of any builders control. And then again, your average legislator has about as much grip on the technical issues of construction as an elephant on the side of a skyscraper.
*warranties are covered by federal law under the Moss-Magnuson act.. the wording of the law about warranties is very strict...for some reason .. after that law was passed.. i decided that providing a written warranty was NOT a good idea.. so i never do.. I TELL my customers that our waranty for labor is one year and we pass thru all of the mfr's warranties...implied warranties are a sticky-wicket.. and i'm not sure you can avoid them no matter what you do...warranties are determined by contract law and the precedents set down by the courts..b but hey, whadda i no ?
*Mike, I'm curious how you arrived at the conclusion that a written warranty is not needed. Couldn't you say the same thing about a written building contract? Aren't we just talking about defining the parameters of our obligation in either case? In writing so there is no question as to what was intended?
*Warranty,Tex, I warranty our work for life.Having said that let me expand: It does not cover designs from an architect that fail although built by us.It does not cover your dishwasher, etc.It does not cover wood rot on an exterior or damage by insects or abuse by the homeowner.Not being a GC makes my warrenty simple.If your door falls off the hinge because of the way we hang it........I'll fix it no charge. However, that ain't gonna happen. Therefore, I can offer a life time warrenty. Never had a call back that was our fault.Ed. Williams
*I used to say that anything with my name one it was good for life.Turns out that viewpoint is myopic. Pass on the manufacturures warranty and the one years from the subs- limit yourself to the one year time frame. It is up to you how long you stand behind your work... the industry standard is one year for a reason...you can always modify your warranty as you see fit- one year is the base line...
*Some around here use the "Till the tailights dim on the horizon" guarantee. I try to give it a little more than that.
*"50 feet or 50 minutes, which ever comes first."
*That's 51 feet or 51 minutes....Rich Beckman
*Jim this whole breaktime thing is an eye opener for me. Maybe it's our area or I missed something but the warranty question has only come up once or twice and both cases were within a year of job completion and both were taken care of. A lot of the fellows who post here seem a lot more sophisticated than me. I may also be more of a codger than some of the others and started out doing this work when a handshake closed a deal and work was guarranteed pretty much for life. Back then the building community was smaller and one's reputation preceded that person. People knew what type of work you did and how good it was and your warranty was implied in your character. But nowadays I can see where something in writing would be appropriate. Skip
*Skip,Don't be so quick to modernize. The methods you used to use are still working today. For a small time operation and if you can qualify your customers, the handshake and guarantee for near ever are an honorable way to do business. And you bet the reputation precedes you. I think the older you are (or appear) the more you can get away with it. Some of my new referrals can't understand the no contract thing. I agree to do the work, you agree to pay me. If my work fails of itself and not by your misuse or abuse, I'll be happy to take care of it at no extra charge. Once we've done business, the paper is out the window. Hope sonny doesn't read this.
*I disagree, get it in writing.I do alot of work on a handshake and have had alot of trouble because the home owner and I had different ideas. Never big problems just a lot of little ones.I'm doing alot of repairs to a porch/screened sun room now. Alot of rotten wood to replace. I'm replacing the rotten wood, making new screens, replacing some skirting. When I went to see her, she asked about installing some lattice where the screens are for privacy. I told her that I wasn't sure if that would look nice or not and if she wanted, after the job was done, I'd put up one piece and she could decide if she wanted to do that or not. I'm working on the job and she came out to ask if the lattice will be on the inside or the outside. She thinks it's included in the price I gave her, I didn't intend for it to be included. She's not scamming me, she just doesn't remember the conversation the way it went so I'll keep my mouth shut and install the lattice at my cost. If I had a contract that spelled out what was being done, I'd have saved myself some time and money.I know I need to get it in writing everytime but I'm bad at that. I've only twice had a job go bad because someone tried to cheat me but had lots of times when there were little problems because the customer and I had different memories of our agreement.
*I do everything in writing... what is not in writing is the warranty... and the time of completion..... like i said.. if you read the law on warranties (which i did twenty years ago....) i decided that the language had to be so restricting that it would just creat grist for the lawyers..read some of the warranties that you pass thru from the manufacturers... are yours that restrictive?if they arn't , then you are probably creating more problems than you are solving.. .. i verbally explain that all of our work that we do is warrantied for one year.. and that's as far as i go... if it gets more complicated than that i don't want the work.. if it's already my job and it gets complicated i handle it..if i can't satisfy the customer i have an arbitration clause...in twenty-five years of business, i've always satisfied the customer except once.. and that one went to arbitration..same thing with time of completion.. i give an estimated range....if it's (((time is of the essence))) i do't do the contract.. someone else can have it..... i have a lawyer.... i don't want to be paying him to defend me or enforce something that is beyond my ability to control...when you are bidding standard AIA forms , read some of the documents, if you can sign those and sleep at night.. good on you !read the Moss-Magnuson warranty law sometime... bet you stop issuing written warranties... notice how all the Home Owner Warranty programs went belly-up ?b OK.. if you issue a warranty , what does it say ?.. i bet it says something like .. we warranty our work for one year..now tell me.. and tell your customer's lawyer what that means.... and $5000 later maybe you will strike that clause out of your contract....Gary Ransome.. in his book, Contractor's Legal Kit.. uses warranties. and he disagrees that the Moss-Magnuson act applies to homes.. but that is only his considered opinion...he does have some good language if you are going to include a warranty...maybe it's time for me to revisit this issue with my lawyer.... hmmmmmb but hey, whadda i no ?
*Ryan, the purpose of a well written and very definitive contract is not so much or only to protect yourself from bad clients, but also to expose on paper exactly what is to be done, and what is not - disclaimers as the legal term is defined. As you know, your lattice situation is an example of a mis-que thru a lack of "written" communication. I don't like written warrantees, only beacuse they dis-allow me to make a PR and marketing coup against my competition.When with Tom and Pete, and now on my own, I always had Rick's philosophy - get enough money for the job so that you can provide a proper warrantee - ours is not on paper. I always tell clients that I would be embarrassed to tell them that I warrantee that their new kitchen cabinets will stay on the walls for one year. In effect, isn't that what I'm saying with a 1 year warrantee? Or that a header will not sag, or the drywall will not fall of the wall - first the first year, anyway. Furthermore, I always got a 2 year warrantee from our subs on rough in work - and for the same reason(s).So, I always told them that in a problem occurs, even 3-5 years down the road, to please call us. If we determine that the cause of the problem was in some was do to a difficiency of ours or one of our subs, we will take care of it at no charge, and happy to do so. "After all, that's why you retained The Lykos Group isn't it - for peace of mind?" Note what I mentioned on the onset of this post - get a sufficeint price to cover those "potentials". It's up to you to determine you should increase your final price by 1% or 3%, but just do it. It cab be an increase in your overhead, or a separate percentage by project type. Project type will determine the potential of call backs and about what specific area(s).We sell peace of mind. Doing so, and in a manner as I've just described give you a tremendous advantage over your competition. The PR and marketing from it provides the opportunity to eliminate all advertising budgeting costs because this part of "Customerization" is what makes your business one that operates from 100% referrals and repeats - at your price.And that ain't bull s**t! Yea, bkunkle, I've going to cram that comment of yours back down your throat.There is more to a warrantee "system" that will get you even more jobs and again at your price, but this post is already long enough.
*Sonny, say it isn't so. Aren't you always telling us that "if it isn't written down it doesn't exist"? Now you are saying you don't have a "written" warranty? Even if it's 1 year, 5 years, 10 years, or a lifetime, if it isn't written down it doesn't exist. It would probably be easier to sell too, if it had a physical manifestation, on paper. I wonder why industries such as the automotive and appliance industry thought it was a good idea to have a limited warranty? They even sell extended warranties. A whole other profit center.
*Peter, the "If it ain't written down, it doesn't exist." is mainly for internal communication, eg., procedures, systems, subs, etc. I always told my people to use their own discretion (the opposite of the reason for the "If it ain't.....) when it comes to servicing a problem on the site, and in the absence of prior training and existing procedures. As you know each day in our industry brings new surprises and problems That's also why I always tell new staff that what I'm really hiring and paying for is " good judgement."Remember, administrators follow the book by the letter. Managers, of which Project Managers are, must have both the authority AND the judgement to make relatively decisions in the field. I never want a client to feel anyone was procrastinating or an employee developing the "it's not my department" attitude. Fix the problem - now! In other words, the "system" says that in this situation do this, or that situation do that, "how we do it here." But, in the absence of previous training or known situations, and one must make a decision, use your best "judgement" and make that decision to the benefit of the client - not the company, whether it's a $10 or a $1000 decision.For example, the lighting company screwed up and the light fixtures will not arrive until 8/8. We need them next week. Lighting company #2 can have them here my next Tuesday at an addtional shipping cost of $186.00. There is no decision. Don't call me. Authorize it - now. I'll handle the additonal cost with lighting company #1 later. And if I get stuck paying that $186, so be it.But the difference between me and many of my competitors is two fold:1. I would not whine about lighting #1 and say to the client - "Nothing I can do."2. Stuck or not with that $186.00, I'd change the entire situation into one big PR coup with the client."You hired me because of my reputation; the client comes first - ALWAYS! So it's not that I don't care about that $186. It's just that that $186 is not my priority - you and your wife are." See, I might even bring this situation again later at the proper time. I want to permanantly plant the right "image" in their mind - what I just told them. By doing so, it diminishes any minor problems we may have had during the rest of the project - it pushes those "memories" out and pulls the ones in that I want. If you read that "Ideas Rule" article in Fast Company, you learned that it's too expensive to market to people one at a time. It's cheaper and smarter to get our clients to market for us to virtually everyone they know. They can reach 20 people for every one I can. "Lykos isn't cheap, but boy does he take care of his customers! Sally and I are glad we got him" That's what their on site condo manager told me, and is what I want to hear every day. Now add that to the fact that we are doing a minor (about 1.5 hour repair) to the ceiling of the lobby to this condo - at no charge. Can you imagine what the manager thinks about us? Can you imagine at the next Board of Directors meeting what will be said about us? These condos go from about $450K to over a million.It's about learning how to take a bad incident and turn it into positive marketing. For a lousy stinking $186!See, that's an anomaly in our industry. But it's how you are able to get $5900 in net profit from a $28,000 job as I am in the above scenario that occured. Again, "Customerization." And the same opportunities arise in doing warrantee work.And that ain't bull s**t either!
*Sonny, what you are telling me is that "you have an unlimited warranty" and not why "it isn't in writing". Why can't the client have a document that they can have and hold? That extra measure of security and reassurance? It's already a company policy, why can't it be commited to paper and handed to the homeowner? Framed and placed above the fireplace mantel for all to see? Proudly!!!
*Hey Jim, good question. If you stopped 10 people in the State of Washington and asked them how long a new construction warranty is, nine out of ten would say one year. It is what every one of my customers has thought, and by the way, most contractors would say the same thing, one year warranty. However in 1986 the Washington State Legislature passed two laws that basically say 6 years to find the defect and another 6 years to bring suit against the contractor. Some of this time period has to do with whether the contract was verbal or written. All the owner has to do is discover a defect within the first six years. Then they had another three or six years to contact and sue the contractor. There is much more liability and exposure out there than simply a one-year warranty. Beyond the issue of limiting your time exposure to having to come back to the property and correct defective work, you need a clause that defines warranty work. Even if you say there is no warranty given at all, the customer may still sue you four years down the road for breach of contract. For example, the bathroom fan malfunctions. The fan was in perfect working order when you left the job, and it was installed correctly. But the fan has simple burnt out. The customer claims that this is just not warranty item. Rather, you breached your contract because you did not install the fan that was specified or instead installed a fan that was inadequate for the purpose intended. The right fan would not have burnt out at the end of four years. The useful life of a bathroom fan is 20 years (at least that is what you customer would say). Other examples come to mind such as hardwood floors that begin to cup, lazy susans that disintegrate, siding that starts to come apart, a roof that leaks, decks that sag, concrete that cracks, countertops that bubble, insulated glass that fogs up, etc. Is this warranty work or is this just plain failure to perform the work correctly in the first place? So, you need to be clear about this. You need to specifically identify what is warranty work and what is original scope of work. Another problem with warranties is figuring out the date from which the warranty will run and when it will expire. Exactly when are you “done,” “finished,” “completed,” etc.? What do these words mean? You need a warranty clause that objectively measures the specific date beyond which the warranty will no longer be in effect. If you simply say the warranty runs from one year beyond the date of completion, then the issue is whether or not the job can really be considered complete when some of the work was installed incorrectly and you were no being called back to correct that work. The solution is as obvious as the problem. The solution is to write your own warranty for a defined period of time. And disclaim any further liability or responsibility to the customer. Washington law allows you to write your own warranty and so you should write a strong and fair warranty in favor of your customer, one that will guarantee that if anything goes wrong with your work within a certain period after you sign the contract with the customer, you will come back to the customer’s property and repair or replace the work at no cost to the customer. You need to be careful about whether you are warranting product or labor (or a combination of both), and you need to be careful about excluding all the other available warranties and liabilities available to customers in the State of Washington. If you want to make you warranty run for a period of one year or two years or three years or four years or fifty years, you can do it. Most builders, in their contract provide a customer with a one year warranty because they are under the impression (illusion) that a one year warranty is standard practice in Washington. Most of the above is from CONTRACTS SUBCONTRACTS CREDIT APPLICATIONS by, Larry Linvill partner in Linville Clausen & Linton PLLC, 700 Fifth Avenue, Suite 4110 Seattle, WA 98104 (206) 515-0640. I purchased this book that he updates regularly along with another titled CONSTRUCTION LEIN LAW. Cost around $45.00 each. If you live in Washington this is very enlightening to be taught by someone with his experience. I went to his seminar sponsored by our local HBA. It was the best program they ever provided in my opinion. There are several more items to be dealt with in the warranty issue that he goes on to provide in the book. It is a spiral bound typewritten compilation that I find invaluable when writing a contract in this state. Sorry this took so long to say. Who ever said contracting was going to be easy? I’m sure each state has its own policies that will be enforced however if like Washington you can write you own warranty it seems foolish to me to not to make one that will be fair to both contractor and customer.Michael Leistiko
*One reason Peter - legality. By not having a written warrantee, I determine what it is. Now, if an attorney wants to make an issue of it it's up to him, but at least, he will not be able to twist something that is not written. Since 100% of our work comes from referrals or repeats, I have no need to write it down. Remember, if it ain't written, it doesn't exist. Only my word makes it exist, and apparently, the nature of the sources of our jobs being as they are, my word is sufficient. It's been working for me for almost 30 years. If it ain't broken, why change it? In many cases and to many people, mostly older folks, a man's word still has value, expecially if it's validated time and again. As someone else here would say - "straight shootin." It's still heads up over any contractual section. You see, a written contract, like a written warrantee, is linked to that specific contract - only. A man's word is for life. It's his character. When acting as a consumer myself, I'll take that to the bank any day over a contract.About contracts. I think I posted this story once. Back in Chicago, when I took in a new partner, I had him go to my bank with me to borrow $10K for 60 days for a fire job we got. Teh VP who handled my account said to Chuck: "I want you to know that what Sonny is signing means nothing without me already knowing his intent." At one time Barb and I were at Niagra Falls and for some reaso I ran out of money. I went into a local bank and went tocash a check for a grand. I asked them if they could call my bank to certify my check as a "warrantee" to this bank. The lady came back and made some comment about that I must have an excellent reputation with my bank because the President told her that they would guarantee my check regardless of the amount.Obviously, since I was not rich, I was impressed as I stuck my chest out and maybe as I walked out it was obvious also that I walked a little straighter and taller. The man made me feel important to strangers 1200 miles away.My bank president just made a marketing "coup" against his competitors in our town, and towards me. I never left that bank and talked them up to anyone I could. Ideas Rule, and ideavirus - let your clients do your marketing for you. Ring a bell? Remember what I said about exercising "judgement?"
*As long as the truck's still in the driveway...Jeff
*Our local HBA has two requirements for builder membership, 1. you have to be a licensed contractor and 2. you have to provide at least a one year written warranty, either ours or your own. (Actually it has a third requirement, your check must clear the bank!)Sonny, it sounds like a double standard to me, a written contract, but a verbal warranty. You have three forms of written building contracts as circumstances dictate, small job thru big job. You have found it necessary over the years to protect yourself and your client by delineating your intent. This, I'm sure, has come about just as most of us have found, there are bottom feeders out there. Some times they even slip through the qualifying process. Your risk hasn't stopped with the last nail driven. It is carried into the future to some undetermined time. Now you can determine that time or the court system can. It's cheap enough insurance to write things down. If it's not written down the customer, the lawyers, and the court system determines what is contract/warranty and what is not. Almost everyone but you. When you have to go to court, you have two strikes against you without saying a word; and that comes via the stereotyped reputation other contractors have created for us.In over 30 years of building you haven't gotten burnt on a warranty issue. I hope you never do. If you had gotten burnt, it might have changed your view as to what was needed, just as it has changed your view regarding written contracts.
*Peter, I can't even remember the last time a client inquired about my warrantee, which usually implies "parts" only. When speaking to them about it I use the term "guarantee", which in my opinion anyway (probably wrong), implies "labor included" also.I don't have one on paper because mine includes services beyond the scope or both a warrantee and a guarantee. Mrs. Smith calls about 33 months after completion and says her grand daughter damaged a kitchen cabinet door. Can I get another one and replace it? She expects to pay for both the door and the labor.Imagine the marketing coup when I show up 3 weeks later with a new door, install it and say, "While I'm here, let me run a bead of caulk against the top of the backsplash where you paperhanger butted the paper to the splash. See, doesn't that look better?""Thank you. What do I own you Sonny?""Nothing.""What?""Mrs. Smith, you're part of the "Lykos Group. Like having an AMX card. Membership of the Lykos "family" has it's priviledges. Thank you for giving me the opportunity to show that we do walk the talk."Yep Pete, maybe it is a double standard. You want to talk about technicalities and definitions. I use marketing and screw the technicalities. I let our attorney handle that, if it ever becomes an issue. I figure Tom and I will get about 30 - 40 times in marketing the value of that $230 service repair.As a book states as it's title: "Differentiate or Die." I'll stick with my "double standards".At this forum and at the RO forum, we've discussed "value" as percieved by out clients and the public in general, at great length. I can percieve that $230 repair as a "value" to me by getting it and pocking that $230. I can also think about the "value" Mrs. Smith might have though by being able to just call me and having me take care of her problem, and to her satisfaction and expecting to pay for it.I prefer to look at that $230 "value" to both her and I, and instead change that $230 into my pocket into $25,000 to $100,000 in additional sales, and furthermore, "presold" sales by her referals. Spend $230 and get back say $50,000. It's a no brainer - for me. But to the person who only looks at, and is tempted by, that $230, well, I really don't know, because I can't even conceive of NOT taking advantage of this marketing opportunity."Customerization" or Double Standards?Whatever. It has worked for me for more that 30 years, since I've employed that same philosophy since first entering the "service the public" industry back as a senior highschooler in 1959. I was first taught the concept by my sister while working in her restaurant.I say it again - Customerization!
*To use your metaphor Sonny, is the mental clay of 30 years so firmly entrenched and hardened that it is beyond the shaping and molding into new ideas and perspectives?Did you miss out on 33 months of marketing by the customer prior to the repair and only realize the benefits when the situation arouse? What if it never had arisen? Does your lifetime gaurantee/warranty have the same meaning now that you are 56 as when you were 30? What happens if you get layed up in the hospital again? Who takes over if you retire or go on vacation? Who administers it if you are one person? How about if you are a company of hundreds? What would happen if your sons weren't in the business? Who else would pick up the responsibilty?I'm sure you will have answers to all of these senarios, have you ever thought about putting them down in writing?
*Peter, we already got four, I think - maybe three, referrals from this lady. What I did is nothing more than part of a marketing plan, albeit, not on paper - shame on me (you're right).Sending a newsletter, postcards, Xmas cards are an attempt at keeping one's company, and more importantly, what that company "image" represents,in front of the clients eyes and mind. And all are valid. So when services are needed again, or by a friend, neighbor, etc., the company image reappears and the prime referral.What I did for Mrs. Smith has a larger impact than all of the above marketing combined, and for obvious reasons.Marketing continues and improves by those responsible for it, or should, or those within the organization who offer additonal ideas to be tried. The results of the marketing continues without my presence. That's the whole point - the client(s) continue to provide that for the company for free, and certainly at a fraction of the cost of other types of direct and indirect marketing. If I'm dead, it doesn't matter because the company is dead. If I initiate unique marketing for my son's business that proves successful, and again I die, it's then "their" responsibility to continue the concept(s), or not. And frankly, it's moot when I'm pushing up weeds My point is this. In three cities where I have operated, I've proven that my, shall we call it, philosophy, has worked, and worked just great. It also worked in my retail "tenure". But, like the adage of taking the horse to water, It's till up to the horse to drink or not - it's not something I can force on anyone else. I can only say to them: "Hey. Try this. It's worked for me for 30 years and I know it will for you too."Funny you mentioned about writing it down. Since we got into this discussion of warrantees and my thoughts about Customerization, I've decided to write a manifesto or treatise on Customerization. When completed, all I have to do is find a site to publicize it. I'm thinking of contacting Mr. Martin who owns http://www.customeriztion.com specifically for a book he's writing about this subject, but for e-commerce. Maybe he will allow me to publish it there as an intrepretation of customerization as it pertains to the remodeling industry - another side, or use, of this concept.It's not really a new concept since some remodelers and builders already employ many or most of its inherent "structures", but I've not seen it actually written down as a plan or system for others to consider it's value and possible implementation. It could even incorporate a written warrantee for those who want that contract inclusion.I know at least one Tennessee builder/remodeler who might like it. I'll bring my mini recorder at the Detroit Show and we can have a round table discussion about it, even kick around some additonal ideas and their pros and cons to incorporate in it's "system". How does that sound? In fact, you can even start a new discussion about it here. There are many company types represented here: builders, remodelers, specialty contractors, etc. What better representative of our industry could we have than already exists within this forum's contributors? Besides, the concept is also applicable to specialty contractors and their relationships to their own "customers" - remodelers and builders as well as their direct customers, and well as who we would normally think as the typical "recipient" of customerization. It's really also a two way street anyway.
*I haven't read Mr. Martin's book so I don't exactly know what Customerization means. I guess it's another book for my reading list.The point is that I perceive customerization pivoting around the needs of the customer and our attempts to satisfy those needs by the avenues available to us, verbal, written, etc.When you write that it won't matter when you are pushing up daiseys, you are wrong. It will still matter to the customer (and us I might add). They will still have a need. You might make some provisions for them before you go. Maybe in the form of another contractor to pick up the relationship. In your case, your sons.It can't really be customerization if you are only thinking of your needs. The needs of the client are just as meaningful. A partnership of sorts.I would love to discuss this more at the Remodelers Show. Along with the book "Birth of the Chaordic Age" which Jerry Hayes finally convinced me to read. Thanks Jerry. If I can help to formulate your thoughts by the discussions here and at the show, again, I would welcome the prospect. Anyway, some of your post are as long as a book already!!!!!!
*Hey Peter. Just got back from Books-A-Million. Bought "The Birth of the Chaortic Age." Barb was reading it while having a cup of coffee. After about 10 minutes she looked up at me and asked: "Who suggested you buy this? This is heavy reading." I replied: "Who else reads this stuff except Jerry and Peter."Anyway, I'm glad we went there. I also got "The Invisible Touch", a new book by Harry Beckwith who authored "Selling The Invisible", and "Big Bucks" by Ken Blancard and Sheldon Bowles, who wrote "Raving Fans" and "Gung Ho!" anong others.Imagine that. Competing authors who formed an alliance to produce best sellers!By the way; Martin hasn't finished his book yet.
*Sonny,"In three cities where I have operated..." Are the people in the last two cities you have operated in still covered by your "lifetime" warranty? Do you still go back to Illinois and Michigan from Florida to replace cabinet doors? Doesn't sound to me like you have to worry about those customers. I've lived and done business in my area my entire adult life. If I tell somebody the job has a lifetime warranty I know I'm still going to be in town 25 yrs. down the road(if I'm still alive). Whether or not your warranty is legit, its sounds to me like so much salesman's hype. And it does sound like you are twisting your own words to say that it doesn't violate your "If it's not in writing it doesn't exist" policy.John
*Sonny I told you about "Big Bucks" and that's surely no heavyweight although it's got tons of great stuff.In my estimation "The Birth of the Chaordic Age" relates to what you are or would be up against in your Possibilities discussion ( Sonny Lykos "Possibilities" 7/22/00 5:01am). I had originally recommended this book to Peter a while back because of the "New Science" that it draws on knowing that he's always interested in that stuff. He finally bought the book when I mentioned that I thought the key or blueprint to the organizing effort that would be required to form a New Economy version of your Possibilities idea was in the book. I don’t think it has much to do with anything about warranties though.As for my warranties I have a lot of language covering a lot of different possibilities for varied mix of project types and conditions and there is work that I will warranty and there is work that I wont and I spell out what those things are in writing. Generally speaking however my warranties fall in the range of 2 to 5 years and for a couple of specific types of projects I am thinking of extending them even further for two reasons. I have a tendency to do what other contractors have sometimes derisively called "over building". I like to think of it as "doing every thing I can do the very best possible timeless quality job I can". I’ve worked projects where I’ve torn out tile or staircases that even though they were 40 years old or more were just as good as the year that they were installed. I like to think that the stuff I am doing today works out like that and lasts the same way too and I take the measures to make sure it does (and I get paid for it too, that’s important). I’m even thinking of making my warranties transferable so that the homeowner can use that as a marketing tool of their own when they go to sell their house which brings me to the second reason for the warranties. Obviously having a homeowner give a new homeowner a transferable warrantee is a plus for them but it also gets me in the door with the new homeowner. On a three year warrantee I will inspect the project at 30 (60 or 90) days and then again at 1 year and 3 years. If I make an inspection of a stair installation at the 3-year point I might be showing up just as the homeowner is considering that new kitchen or bathroom. And in the case of the transferred warrantee I can’t think of a better potential client to approach that one who is just beginning to think about what they can do with their new home.All in all I find it’s a great marketing tool but don’t go in to it blind or someone will try to take advantage of you and you will get creamed. You need to account for things like; "normal wear and tear", "patination" "oxidation", "work performed by others" and "previously existing conditions". Like I said I have lot of language for lots of projects explain what’s covered and what is not but I think if you are really building QUALITY into you projects this is how you can help sell that. I was also wondering if Rick had any thoughts on selling extended warrantees. When a client buys the appliances we put in to our projects they are often (what am I saying almost always) offered the "extended warrantee". Why can’t we do that too?And…. I also want to hear Sonny in regard to JRS’s question. What about those clients in Illinois and Michigan? Good questions.
*Ryan I'm not against written contracts etc. The warranty thing is a little different and with a larger operation where the warranter may be somewhat removed from the actual work he is guarranteing the situation may be different.I did have a situation last year where a sweet little old lady had a question about the work so I told her to hold back a percentage until everything was worked out.I also had her make a note in her check book noting the balance due me. Poor little old lady (net worth quite substantial) said she thought she had paid me in totem. I refered her to her check book and gratefully accepted the balance due. Skip
*It would seem that the truth is that, in almost all cases, the warranty is "limited" in some fashion. The solution might be to question those limits and delineate a process for dealing with them. Your intent is then clarified to the customer and expectations are set. Then if you want to arbitrarily exceed your own standards and cover something you clearly have no obligation to, you sincerely have the opportunity to WOW the client. If you don't, then they aren't really disappointed either. Their expectations were met.
*Frankly I’m surprised at the question of how I handled warrantee work after leaving Chicago and Michigan. It was either prompted by naivete or some idealistic concept not attributed to the business world. Is this question a test of my morality or character? Was the CEO of Avanti or Studebaker oblicgated to pay for needed services remaining on the warranties in effect when those companies shut down?Should I have created a reserve at a local bank to be administrated by an officer for repair invoices from a predetermined person to be contacted by the previous customers for warrantee work of a then defunct company? What if I closed the company but remained in the city? The same arrangement? What if it so happened that I had a fatal attack. Should every small business owner, sole proprietor or President of his corporation anticipate this and make the same similar arrangement in advance?Let's take this question one more step further and jump "out" of the business world and into the morality world. JRS and Jerry, how much are your reserves for the above in the event you get killed in an accident? Why should your customers “suffer” just because of fate and your lousy luck!I received not one call from Chicago customers after moving to Michigan although I sent notes thanking them for previous work and where I was going. 411 was still providing listed numbers and mine have always been listed - here too. From Michigan to Florida I get three and had an ex-employee take care of them and invoice me in Naples.When companies close, so do all “operations” - ALL operations, becasue the “entity” no longer exists. Moralizing about warranties is one thing. Marketing and the cold realities of the business world is another.About two years ago while still working with my sons, I created a 27 page contract used only for larger dollar amount jobs. Below is the Warrantee section which I currently don’t use simply because I no longer do such large projects.B - Warranties 1. Owner must notify contractor of suspected deficiency within five calender days of becoming aware of suspected deficiency by telephone or mail and must discontinue use of suspected item until contractor has inspected said item. 2. Our warranty is for three years from project completion date for all contractor and subcontractor supplied material and labor. The exceptions are as follows: a. Owner supplied material and/or labor. b. Problems arising from owner supplied materials and labor. c. Termination of this contract as stated under section XXI - Termination and Cancellation. d. Owner abuse of item in question. e. Owner failure to perform any normal maintenance as recommended by one or more material manufacturers. f. Failure by owner to execute owners responsibilities as stated under section XII - Owner Responsibilities. g. Normal wear and tear of items contained in the project. h. Modifications not performed by the contractor after project completion date. 3. Contractor reserves the right to be the first contractor to correct any deficiencies noticed by owner during the warranty period. 4. Warranty is transferred to new owner in the event of sale but only if contractor is notified of the sale, in writing, within five days of closing date.Was that acceptable to your standards? To my knowledge sons Tom and Peter still use it.
*Sonny,I thought it was a legitimate question. It probably could have been asked in a little different manner, but legitimate anyway.You seem to get way too deep in your discussions about how to properly maintain your customer relationships, and how best/most professional to handle the customers after the sale. With all of the very in depth conversations going on, you had to know that someone would ask this question. I don't think you answered it very well, though. The answer is pure rhetoric. It basically, and this is just my opinion, tells me that the "Lykos Group" is here to take care of your every need as a customer, BEFORE, DURING, and AFTER the sale/work (or at least until I decide to pull up stakes and hight tail it out of here). I don't blame you though, there are reasons that are very much acceptable for going out of business. Health is one of those. And, I don't blame you for not putting anything about your warranty in writing. If I knew that there was a possibility that I would be going out of business in the near future due to health reasons, I wouldn't want a written warranty following and dogging me either. With nothing in writing, you come out in the clear (except for those pesky state laws regarding warranties either implied or expressed).Now please don't get mad about this post. It is really not meant to be confrontational, or derogatory towards you or your business. I just wanted to say that I thought the question would be asked, and wondered myself how you would answer it.Now here's another statement that might piss off a few. I have read, am now reading, and will read a lot of these books that you mention. I also have read and studied many, many more books on business management, business relationships, and just about anything else dealing with business you could imagine. What I keep seeing here, and I saw a lot at the Remodelers site, was people pretty much quoting these books, or at least qutoing the ideas in the books as if they were operating their companies like this. It all sounds good, but most remodelrs/builders here don't operate like a fortune 500 company. It wouldn't work if they did. You and Rick are very fortunate. You have achieved in very short order what most here can only dream of. You are basically in the top 1% of Remodelers nationwide. That is wonderful, and you seem to be able to do it every few years. I think that is great. However, that leaves the rest of us in the 99% group, which cannot possibly operate like you and Rick do. Most of us are one or two men operations. We could not possibly make the money that you and Rick make, nor do we really want to grow to be that large of a company. We are simply sole proprietor operations, and we make a decent living doing what we love to do. We are not in a position that we can be compared to the Companies/Businesses that you and Rick keep wanting to turn us into. We do not want to be there. What we want is to make a decent living, work our own hours, make our clients happy, and go about our daily lives with our heads held high. The stress levels at the points you and Rick are at now are not worth any amount of money to me. I've been there, done that, and got out of it for my sanity and health.There are two ways to make money in ANY business. Not one, but TWO. You either sell large volume at low to moderate prices, or you sell low volume at high to very high prices. I prefer to sell low volume at a price that will keep me in business.I know from experience and training that the more people involved in your business, the less able you become to control quality. I personally got tired of redoing everybody's work. My name is on the company, and on the contract. I do not want the customer to look at the work and wish they had not hired my company. Larger outfits, and some of these have gotten very large, don't care as much. They can't. Their volume of work is massive, and the work crews are large. The owners of the company cannot physically stay on top of all the work being done. They are relying on someone else to build and maintain the company reputation. I personally want to be in control of my own reputation. That is why I choose to remain small enough that I can oversee all work. Heck, I DO all the work. Anyway, just my opinion... JamesJames
*No Sonny, it's not a test of your morality or character. I'm simply pointing out how much your "oral" lifetime warranty is worth. It's salesman hype used to close the sale. That's all. If you aren't around to back it up, it means nothing. I'm not suggesting you left those cities to avoid your warranty, I'm just saying that now that you're gone it means nothing.Your many and lenghthy posts here certainly demonstrate your Wisdom, Experience, and Business Acumen. I'm at a loss why you don't see the hypocracy of your position on an oral warranty vs. your statement that if it's not in writing it doesn't exist.The reason you moved isn't as important as the basic fact that you did move. Somebody was your last customer. You were there to collect the check, but you weren't there when the sink started to drip, or the door stuck, or the cold air duct started to "doink" when somebody stepped on that certain spot. Just because they could call 411 to get your number doesn't mean it would even occur to them to do that knowing you were more than 1,000 miles away.Lifetime warranty = salesman's hype. I have no farther to look than your example as my proof.John
*Sonny I think if you are going to use a high moral soapbox most of the time for your speaking platform you have to answer the question when it is called without expressing so much indignity. "It was either prompted by naivete or some idealistic concept not attributed to the business world. . Is this question a test of my morality or character? " Don’t jump to conclusions so fast. Re-examine your mental models and listen to what’s literally being asked rather than what you think might being asked. I was actually seeking a practical functional business like answer and I think JRS may have been too. I wasn’t around or aware when Avanti and Studebaker bit the dust but I was around when Power Computing went out of business. When Apple purchased their assets I received a letter saying that Apple would honor the remainder of the warranty on my computer and provide me tech support. Did anyone purchase you assets, you client list when you left the mid-west? Well you’ve explained how you handled it now but we didn’t know that before did we (or maybe we should have just assumed that’s what you did)?As for the "cold realities of the business world" that’s why we have corporations to protect our personal liability when we go out of business but what about the guy who is a sole propietor who changes careers or goes out of business? How should he handle these kinds of issues? Forget about the moral question and just think about what is the real world business answer? I s there one that you know of? Hey what happened when HOW ( Home Owner Warranty) for builders went belly up a few years ago? Sonny is there a big business solution that could be applied to us small businesses? Is there a solution in use by the big builders like David Weekly Homes, TollBrothers, or Ryland Homes that might transfer to a smaller industry segment or to a different segment like remodeling? If you remember back on the old Remodeling Online forums (R.I.P.) a fellow started a discussion there regarding his business idea of providing warranty service for remodeling contractors. I had hoped to prod you into bringing up that kind of idea for discussion since you jumped in back there. As for "Jerry, how much are your reserves for the above in the event you get killed in an accident?" The answer is none but that’s not very business like is it? I figure 1.25% for warranty work in my pricing but it’s always come out to be less than that (knock-on-wood) But thanks for calling me on that; I’ll have to ask my insurance agent about it. Since your always claiming to have one foot in the grave how much do you have in reserve in case you die from emphysema? The point is that IF I moved my operation to Florida what would you have recommended that I do. The warranty language you have there is pretty good and a lot like some of mine. One thing I did notice however that is slightly different is that the warranty for material is different than the warranty for workmanship or labor in that warranty provided by the materials manufacturer may be less or more in years than what the installation workmanship is warranted for.
*I don't know one of us, that when called to question, could not benefit by the insights of another. Sometimes things aren't thought out as completely as you planned. It's easy to pick on Sonny here because he is so honest and open about his business. A few of us are reluctant to be that open for fear of reprisal. By the same token, many of us can and have benefited by the candor of a few. We know full well that we are not 100% there yet with regards to our businesses. I don't think anyone really is. It's a case of constant improvement. The real challenge is being open-minded to those improvements. It's time for all of us to take another look at our warranty program and make sure it still performs to the expectations of our clients and ourselves. Some really thought provoking issues have been generated here.
*Peter,I've been reading and discussing Sonny's posts and ideologies for well over a year now. I have all the respect in the world for him, and for his knowledge. I learn every time I read and discuss his insights.This question was bound to come up. In case you haven't noticed, and you will sooner or later, Breaktime is a very "tough room". It is a lot harder on posters than the remodeling sight was. Sonny knows this. We have commented on it many times. Whenever someone says something contradictory, or whenever an idea that doesn't sound right comes up, it generates a lot of skepticism, and comments. Afterward, we all talk it out (discuss it) and learn. We all usually expand on the idea or statement, and everyone benefits. I am not lambasting, or denigrating Sonny at all. I have the utmost respect for him. I do sometimes have a rpoblem with all the guys who have supposedly been in business for 20 years plus and are still trying to learn the BASICS of setting up a business. There is no way they have been in business for 20 plus years and don't know how to set up a business to be profitable. HOW profitable is another question. We all want to be more prosperous, and we share knowledge and info in order to improve our bottom end. But... you still have to be realistic. Reading all the books in the world on business strategies won't do a damn bit of good if you do not truly understand what they are trying to tell you. You gotta know your market, your clients, and how to successfully run a business. Knowing how to do it, and being ABLE to do it is a whole different barrel of pickles. James
*Let's see. John says my verbalized warrantee is "sales hype." Guess I really buffalo'd all those dummies in Michigan for 13 years, and the wealthy ones here for 9 years. I did such a great job at conning them they still call me, and Tom, to do more work. If they only know the truth, eh? By the way, I never said I gave lifetime warrantees and I don't and never did. I'm not that stupid. Meanwhile John, I'm still waiting for an answer to my question. What's your plan to service your warranties if you die in an accident tomorrow? Jerry, it's too important of an issue to just think about it. Drop what ever you're working on and create a plan to address this issue in your various companies, lest you too be accused of only using salesman hype. Also, servicing warranties after death or business closing is a moral question because legally, when a company ceases to exist there is no more warantee. In the case of Power Computing, when Apple bought their assets they also "bought their liabilities, of which warranties are in that category. Ditto when Tom and Peter bought me out. There is a legal obligation as part of the purchase contract. That's one of the reasons companies opt to incorporate - reduce or eliminate liabilities. What sleaze balls, trying to get out of moral responsibilies via a legal ploy! I know, for tax purposes, but even that's a cop out. Why would you want to "legally" screw your country out of money. We all live here and enjoy the benefits of the USA. We should want to contribute to it's operating expenses so others can benefit. All of you who are incorporated please go back to sole proprietorships. By the way Jerry, the warrantee I posted has many flaws and some are serious. I didn't tell my sons about it because they don't want to hear it and don't take any advice from me anyway. Are they smart or that? So I rarely talk to them abut their business and they don't volunter anything. We keep it a Dad and sons relationship.Peter, you bring up an issue Barb and I have had a couple of, let's say, heated discussions about in the past, and is a thorn is her side. She contends that I should not be so vocal about the issues we talk about, bare so much info about my business, present and past, and my personal life. She contends that I will be viewed as both a know-it-all and a jerk, and believe me, she is very intuitive. I think she's right. She says that people will do whatever they want to do anyway, so I should just keep my mouth shut. She's right, as usual.The reason I am one of those who refer to statements made in various books is not to indicate I'm a learned person. I am well aware of the human tendency to respond to those types of comments I make as just another statement or concept by Sonny flapping his mouth. So, I refer to books by respected authors in the hopes that readers will realize that I am only reiterating statements and philosophies by those respected people, and therefore, they did not originate from me, and becasue of their source, some credence should be given to them - validation.I guess my bullshit per bkunkle and sales hype per John will have to stick to me until I read posts by others here as to their solutons of post business warranties that I can then incorporate so I can stop sticking it to my customers.James, you don't have to have a Fortune 500 company to implement good business practices, but then again, that could be bulls**t or sales hype too. I'm just duplicating other expert's statements. A one man company can do the same. Regarding your coments about "large volume at low to moderate prices" OR "low volume at high to very high prices". I don't agree those are the only two options. Tom will do high volume at high to very high prices. About 3 million this year and all high end projects. I on the other hand, will do about only $275K this year, and also at mostly high prices, yet not all to high end clients - maybe half are - but at high margins.Tom is not an anomaly. Many other do the same thing. But, and the BUT is important - notice we rarely see posts from those extremely run company owners featured in our various magazines. Even Tom rarely posts. They all must have the same intuitive attitudes as my wife. Mind your own business and stay off the forums.And James, for several reasons, I too choose to stay small with only one fulltime employee. Believe me, I was never in that 1% group. I was never sharp enough or organized enough and not enough of a business person to be one. I was always in the 99% group, just with more staff than most.So, lets see the warrantee solutions and see if they are sound business practices or unrealistic.
*James, the Remodeling site can get pretty tough too. I was on the wrong end of several threads! But it sure makes life interesting, doesn't it? You've got to be thick skinned to be in business in the first place. It certainly has helped being a regular there.To return to the warranty issue, we have guest speakers at our HBA meetings from time to time and one time we had a lawyer from Knoxville, named Larry Vaughn. He spoke about contracts and warranties for almost 2 hours. For those of you that have a clause for binding arbitration, Mr. Vaughn says this is a mistake. He would rather see the case go to court because it opens up additional legal avenues that are not available in arbitration, one of which I believe was disclosure. I don't know if he was speaking to increase his business or not. Anyone know more on this?
*yes... speaking as a non-lawyer.. mr . vaughn is sadly mistaken.. .. i have a binding arbitration clause and it certainly saved me on the one occasion it was invoked.. the total legal bill was $300.. and it was settled for half of what was due me...if i had gone to court.. i would have paid more than $5000 to my lawyer and i would have lost the case.. (IMHO).. i have testified as expert witness in court cases that were lost.. and appealed to superior court..most of these drag on for 3-4 years.. with the legal cost rising all the time...what small contractor can afford justice at those prices.. sonny's 1% set-aside would soon be exhausted and if the customer has deep pockets , he can simply appeal, and delay.. until you're broke...this ain't some multi-national construction company with more legal staff than the average state attorney-general we're talking about..this is some schmo trying to get his final payment by paying his lawyer $150 / hour... you tell me...all of the legal experts who advise our Builder's Association say "binding arbitration"..so... larry vaughn... stick it in yur ear....
*One of the 1st posts on this thread was Mike's. He mentioned not using warranties either while everything else is in writing. His reason for not having written warranties is the reason I don't. I like his term when he stated giving lawyers "grist", which is exactly that. The more words, phrases and sentences, the more ammunition for them to twist, attack or otherwise turn them right back against you. Remember Clinton's "What is is?"I know what I do. My clients know what I'll do and I'm in control. Peter, lawyers LOVE court cases. It's what fills their money belts. They HATE mediation or binding arbitration. My large contract stated a binding arbitration clause, and at my lawyers suggestion I added, 'in Collier County." Had I not included those 3 words, Mr. Smith's sleazy lawyer could have mandated I go to his client's California or Maine home residence county for that arbitration. Like Mike, I too have been an expert witness, maybe not as many times as he has. So one learns how lawyers think and the ammo they will use and the depths they will go to to win a case, and all the while the clock ticking - read $$$$$$.About warranties. I routinely give a 3 year warrantee when we get jobs to replace prehung garage service doors. Typically they're the 6 panel Stanley metal doors that sell for about $110, unless I can talk them into a fiberglass door. I use KDAT jambs and use a double coat of back priming on all wood plus we coat the jamb and trim bottoms with Geocel's WaterShield. Usually anywhere from a dozen or two openings, to 48 was my largest. I created an inspection form for the condo associatons. I got the idea from the auto dealership. To validate our truck and car warranties, we must have certain inspections done - those 3000, 6000 mile and so forth - and they pay for them. Warrantee work I do for free and the rest I charge for. Anyway, my 3 year warrantee, actually "guarantee", was predicated that they hire me to do an annual inspection, note anything needed to be done and then do those things and they pay me for it. It's like a preventative maintenance deal, but just covering the items of that particular project. I inspect caulking, trim joints, scratches on the door skins, loose hinges, rubbing doors, etc. I do not use finger jointed brick molding , only clear fir. I explain to them that everything moves at different rates since they all contain different masses, etc, and the reason for the inspections is to catch minor things quickly. Even a door that's been scratched should be touched up to prevent rusting since these cheap doors are not galvanized - ludicrous in south Florida. I compare this arrangment to auto inspections. Doing this gives them my own mandates for them to get the 3 year guarantee, and the peace of mind of knowing someone who's in the business will do the inspection. If this was "sales hype" and they didn't trust me they would know it since this arrangement is an opportunity for me to cheat to pick up a few more bucks. Yet I get several calls for these jobs annually. Think they really see it as sales hype, or as a valid and smart preventative maintenance program?Anyway, I thought I'd mention the above because what we do is not so different from what dealerships do, except they get us to have inspections done to prevent problems and validate their warranties. It's really a win/win situation for both parties. It's something to think about for those of you who want to give extended warranties in writing, or lifetime warranties as Jerry is thinking of doing.
*If you don't have a written warranty that specifies "binding arbitration" then the case is definitely going to court with those associated costs. Isn't that reason enough to have some sort of "written" warranty?
*you can have a binding arbitration clause without giving a written warranty.. my problem with the written warranty is that i don't think i can present the written language that is going to define the warranty correctly so it will be legally binding... i still have a problem with the language of Moss-magunuson..the binding arbitration is to protect me from lawyers..the warranty clause can throw me right back into their clutches..95% of my contracts are one page.. if i get into a 7 or 8 page contract then there will be an article describing warranties... but it ain't gonna be in my one-page proposal/contract...
*And the only time Mike's gonna be forced to start using 7-8 page contracts is when he starts getting jobs for more than $150 in material and labor right?Peter, again about that lawyer. The second doctor? Barb went to see about her foot told her that she would probably need surgery on that particular toe. Then later she would probably develop "hammer toe" eventually and would need more surgery to take care of that.The 3rd doctor and her present and final one, replied to her when she told him what the 2nd one told her was: "Well what does he do for a living? He's a foot surgeon!!"Lawyers don't try to pass the bar exam to sit in arbitration meetings.By the way. Barb gets another bone scan this Friday. Gets to keep the new cast for another 4 weeks - that will be a total of 6 months. And if the bone scan shows no improvement, which is what is expected, she will have a bone transplant from the heel of her foot to the particular bone to repair it - done around August 25th, and then another 3 months of a new cast of absolutely no walking on it. Total cast time - about 9 months for what was supposed to have been a 4 week recuperation period - if originally done correctly.It's hard on a man to see his wife cry and be able to do nothing about it's cause.Doctor #1 is the one who after she keep going back for check ups all he could say to her was dumb things like "I don't know why it's not healing" and "Gee, I guess in hindsight, I COULD have done this or that." Or "I guess I SHOULD have done this or that."So, talk about "warranties - does she sue doctor #1?
*I would assume that you have an arbitration clause as part of your contract then. What extends that clause to the warranty? When the job is finish the agreement is terminated. Later, when a warranty issue crops up, can you go back and reference the contract when it made no mention of warranty in the first place?
*I had an experience with binding arbitration several years ago. I was the consumer. It seemed like a very fair and informal process and I was pleased with the fact that each side got to say what they had to say, in plain talk. I'd be comfortable going to arbitration with any of my customers, if that's what it took to get a third party opinion on what's fair.
*I just spotted this as a featured new article on the HousingZone site this evening:Remodelers Boost Customer Confidence With Warranties for anyone who's still interested. There is also this one there too that might dig up some debate too: “Performance Guidelines” Bolster Builder Warranties. I know back on the old RO site everyone pretty much panned the "Guidelines" book but I believe it can still serve a useful purpose inspite of its loosely written specifications.
*gerald .. alittle background on ""warranties""remember H.O.W. ?... gone but not forgotten...and the biggest mouth in town .. used to write beautiful adds, could charm the silver off the palte.. always gave lifetime warranties..bankrupt and moved out of town..every warranty scheme i've ever heard of is dust on the shelves... IN THE HOME BUSINESS....i get great warranty service from Andersen.. and they get my business for it so i can passs it thru.. and i use other mfr's warranties..but , most of these warranty deals, so much $ / thousand dollars for rates.. you read the fine print, and the loopholes are big enough to drive a train thru... never mind if they will still be around to file a claim with...b but hey, whadda i no ?
*Mike, one of the recent books I read (I wouldn't look for it unless Jerry insists), the author said about doing things to market one's company or product, "If it doesn't add value, don't do it." I agree.I think "extended warranties" would be included in that statement. I really don't think it's a high priority with the vast majority of our clients as opposed to what "is" important to them. Maybe for cars, appliances or computers, but for now anyway, not for the construction industry. I think a one or two year warranty suffices.
*It's dangerous trying to quote and cite references around me isn't it?Hey! read the article Remodelers Boost Customer Confidence With Warranties I just sold a crawlspace isulation project the other day and the one critical question I was given was regarding a warranty!
*yeh.. but what the hell were you warrantying in a crawl space insulation project ?suitability of product. ?.. that 's mfr's warrantythat it's installed correctly. ?. i mean.. why bother with a warranty on a crawl space insulation project ?if i was going head to head with you on that customer... i wouldn't let your warranty bother their heads at all..my only point jerry, is the guys i've followed around for twenty -five years who had all thse gilded certificates of warranty... they ain't in business no moah... maybe your customers are buyin ,, but i ain't .. so why would i want to sell something I think is worthless....if this is part of your program... go for it... i'd rather find some other value added perception to boost than ""fully insured-- lifetime warranty"""
*OK, I read it. I still stick by my post. I like the ambiguous marketing:"Remodelers can boost customer confidence and increase referrals ..............................."By how much? .5%, 2% To the remodeler who already has a good rep and does good work, I say next to nil to nil."More importantly, the homeowner is assured that their investment is protected." I agree, but by the same types of remodelers I stated above.The only advantage I can see to the above warranty in those situations that we discussed earlier in this discussion: someone moves, dies, becomes incapacitated or the like.
*First of all I want to stress that I HAVE NEVER MADE OR OFFERED A CLAIM Of ""fully insured-- lifetime warranty""" and I never would. My clients would spot that a mile away as a bunch of hoeey. I came back on here just so that I could clear things up and not give the wrong impression about what I was guaranteeing or warranting. I know I wasn't clear about that before. What I warranted was the workmanship and I made no "guarantees" regarding the performance. I couldn’t possibly in this particular project's circumstances. It’s a 100+ year old farm structure, now a residence on a stacked stone foundation with assorted stacked stone piers in various locations to prop up and level the structure where it sagged. Will the insulation fall out? Highly unlikely. Will the rat slab crack? In this case I am sure it will. Do I mind going back and touching up cracks in the rat slab for the next three years? No, not at all for the price I charged. That’s what they are paying for. Not only that this building needs other work and the family has other plans too so this way I am with them for the next three years. I inspect projects I warranty according to a schedule that usually amounts to once a year in most cases or sometimes just a little longer interval. It’s marketing. No one is ever going to recommend me for insulation projects saying " Hey I got just the guy for you he very inexpensive" but they will say "He ain’t cheap but boy does he give you service after the sale". Isn’t that one of the biggest complaints that consumers have regarding our industry,... its responsiveness?As for "suitability of product... that 's mfr" you are correct in that regard and that’s spelled out too in the warranty. I’ve also followed guys around too although not quite as long as you have Mike but I see many of the big longtime players around me with warranties. As for HOW tanking years ago that was due to the gross miss-management of HOW as I recall. Admittedly you can’t do mediocre work and expect a warranty program to work for you as a marketing tool. You will end up paying for it miserably. As for "if this is part of your program... go for it... i'd rather find some other value added perception" I have other value-added programs and services to offer too and I think they are more noticeable in my case anyway. To be honest with you this was the first time in years that I can recall that the warranty program was ever asked about as a key issue. My clients are really buying artistic design, problem solving, and artisanship. This kind of project is actually a different world for me.As for Sonny regarding "I really don't think it's a high priority with the vast majority of our clients" how do you know that for sure? Do you conduct surveys? Was it a result of some Conjoint Market Analysis Study that NAHB or NARI did? (Conjoint Market Analysis*- there’s a New Economy word for you) Do you have and outside third party group conduct surveys? What are we basing that assumption on? My point being we often see just what it is we are looking for and if we want to believe that our customers don’t really care about warranties that’s what we generally observe. I don’t remember what book it was in either so I’m not making a quote here now either but more often than not we don’t know what our customers really want or value. At best we are making calculated guesses at what they want. Warranties are just one of my calculated guesses. > -* Conjoint Defined. Conjoint analysis is one of the terms used to describe a broad range of techniques for estimating the value people place on the attributes or features that define a product and service. Discrete Choice, Choice Modeling, Hierarchical Choice, Card Sorts, Tradeoff Matrices, Preference Based Conjoint and Pairwise Comparisons are some of the names used for various forms of conjoint analysis.> The goal of any conjoint survey is to assign specific values to the range of options buyers consider when making a purchase decision. Armed with this knowledge, marketers can focus on the most important features of products or services and design messages most likely to strike a cord with target buyers.Somewhere sometime in the future a New Economy company with the digital-know-how and market smarts will conduct conjoint studies of the building and remodeling "customer". And they’ll determine just what they are willing to pay more for and what they do and don’t care about with regard to both products and services. I know the big manufacturers already do it for product features so it’s only a matter of time before somebody does it for services too. Until then it's like I said above we are all just making opinionated guesses about what we think our customers value. None of us are using real statistics ( yet)
*jerrald... thanks for the update .. the rat slab makes a lot of sense.. and i'd warrant that too.. i wouldn't do it in writing is all..i've been doing conjoint analysis for 25 years.. but i didn't know i was doing it until two minutes ago...instead of learning how to sell a job in school .. i've been learning it OJT... and conjoint is another description of EXPERIENCE...as in ... guess i won't do that again.., hah,hah, hahthanks for the insights.. keep 'em comming
*[As for Sonny regarding "I really don't think it's a high priority with the vast majority of our clients" how do you know that for sure? Do you conduct surveys? Was it a result of some Conjoint Market Analysis Study that NAHB or NARI did? (Conjoint Market Analysis*- there’s a New Economy word for you) Do you have and outside third party group conduct surveys? What are we basing that assumption on?"]Jerry, to answer your questions:1. I learned from my retail experience to ask specific questions. I continued when I first became a handyman back in 1971. When I started I resolved to make a list of the typical complaints the public against contractors in general and to try my damnest not to make those mistakes. Nearly 30 years later, I still ask specific questions. Guess the world can change daily but some consumers concerns and complaints still remain on the top of the list. Doesn't say much for our industry at large does it?2. Warranties have never come up in my tenure as a remodeler, or at least not that I can remember. The important issues have always been schedule, product selection, protection of contents and price, generally iin that order.It's prudent to periodically determine the concerns of one's market, important or minor. I think most good contractors do, consciously or otherwise. Call it a Conjoint Market Analysis or something else; a rose by any other name is still a rose.
*> Guess the world can change daily but some consumers concerns and complaints still remain on the top of the list. Doesn't say much for our industry at large does it? That's true and unfortunatly the bulk of our industry is not willing to stand behind our work and offer any real solid warranties on it. We can't begin to address our poor image until we stand up and deliver. What's that say about the quality of our products and services that we wont put down on paper just what they're worth over time?
*I do get customers occasionally asking about my warranty. I tell them that (and my contract states) one year. I go on to explain that the one year is a minimum. If they ever have a problem with work I have done, I will be happy to look at it and if it is something we did not do properly, I will stand behind it (however, I get to make that call). What was that word, conjoint? Is that something that holds bricks together?
*ConjointThat's where the prisoners live.
*Good one Ralph !!
*Maybe this is considered a niche market, in my area warranties are very important when selling roof jobs. All those that I bid against offer them, whether they are a fly-by-night or well established. The f-b-n's usually offer a 25 yr., "lifetime" or some incredibly unrealistic amount. They are easy to rebut with the customer. But all the established cos. offer 3-5 yr. workmanship warrantees on roofs, in addition to the mfrs. warranty. I have practically no prospects that don't bring the warranty issue up on roof jobs.(residential or commercial)John
*John you're right. I forgot about roofing, siding, replacement windows, and a few others. In Michigan, warranties were very important to our consumers of those purchases. I was thinking of general remodeling like kitchens, baths and additions.
*"Sonny, schedule, product selection, protection of contents and price" along with Jerry's artistic ability, profesionalism, and warranty. are just symptoms of what buyers are really looking for. Peace of mind. A factor of comfort. Anything we can offer that would contribute to that peace of mind will give us a marketing edge and is always worth the effort, written warranties included.
*In kitchens, I would say warranty comes up about 85% of the time around here. That's why I have a bare minimum (one year)in my contract; I can always choose to better that, but the customer knows where they stand. It never gets mentioned in other things I do (trim,built ins, furniture, etc). I think people look at a kitchen very similarly to how they view a new car.
*Yeah, it seems to me if you have a standard warrenty, you should state it as cleary as possible, in the contract. It's for the customer's peace of mind and they should be able to refer to it anytime for clarity.
*
I was talkin' with an elctrician about his standard contract, pickin' his brain, and he says, "see that clause about my warranty? That's the most important part of your contract. I warranty my work for 1 year. (it was clearly written) If you don't specify your warranty, they automatically get 12 years to ciome back on you."
Now, I'm sure it varies from state to state (and Province of course), but 12 years seems like a long time. What are your experiences about this? Do all you folks specify your warrenty? How long is it? 1 year doesn't seem like he's taking responsibility for his work. What is the industry standard? Thanks - Jim