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Re: Goodwill, Where Are The Limits
Posted to Shop Management Forum on 11/18/2015 2 Replies


My brother asked me that same exact question in 1985 when he saw me honor a transmission warranty that was technically out of warranty both in terms of time and mileage. He asked me, "At what point would you not feel guilty charging full bore retail all over again?"

That was a tough question because I had never thought about that before. I finally said 50K miles. Then he asked me how many years and I said 5. My brother then said, "So, you really have a 5 year 50K mile warranty, but you don't tell anybody, is that right?" I him-hawed around and said "I guess so, but I deal with each one on a case-by-case basis."

He went off on me and said, "OH MY GOSH LARRY! You have a 5 year, 50K mile warranty in reality, but you aren't telling anybody about it. Do you realize what a powerful marketing tool that would be if you advertised it?"

And that, Louis, was the birth of our now famous 5 year warranty we have been giving ever since 1985. In 2012, we upped the mileage on the warranty from 50K to 100K to compete with the dealer warranties. It is, indeed, a very powerful marketing tool that allows us to charge as much, and in some cases more, than the dealer.

We discovered if it makes it the first year without a hitch, there's a 90% chance it will make it the full term of the warranty. The ones that don't are more than covered by the extra revenue generated by the top dollar generated.

I would like think the warranty was my idea, but it was really my brother who is not only not automotive, he's not even technical at all. He's actually a professional magician. No joke. 1:29

Larry Bloodworth
Technical Information Specialist/Technician
Tanner Transmissions
Draper, Utah, USA

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