Thread: Warranty system
View Single Post
  #14 (permalink)  
Old 08-28-2013, 04:15 PM
silver creek silver creek is offline
Senior Member
 
Join Date: Feb 2011
Location: Wisconsin
Posts: 2,044
silver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond reputesilver creek has a reputation beyond repute
Default Re: Warranty system

I happen to agree with most of the editorial. I think it is the fact that I grew up during the times of regular warranties against manufacturing defects and NOT no-fault warranties.

There was a time when the Sage RPL could be bought for about $185. The next year Sage brought out the no-fault warranty and the same fly rod was suddenly $250.00. Almost every other manufacturer then followed suit, and rod prices rose across the board.

Why did Sage do that? They wanted to one up Orvis's 25 year gurantee.

What happened is that Sage collected about 40% more per fly rod. That went to the bottom line because they collected this money and there were few rods being returned. If that "excess" profit was actually treated as insurance companies treat premiums, rod companies would not be in trouble now.

That money should have been invested and over time it grows. It is that growth that helps pay for the repairs. Warren Buffet's Berkshire Hathaway fortune is built upon the premiums and investment of Geico Insurance premiums.

I can just about guarantee that that money was not held back and invested against future claims, but was taken home by the owners of Sage and spent. Overtime, you have this huge overhang of rod warranties and no funds to pay for the repairs, because those funds were not segregated from earnings as they should have been. The bump in rod costs were payments against future breakage. The purchaser was buying INSURANCE with the extra money the rods cost.

Now we have this mess. So yes, get rid of no fault rod guarantees. If the rod breaks because of a manufacturing defect, the rod company repairs it for free. But if an angler breaks the rod because it is his fault, it is his responsibility to get it fixed. Why should a fly fisher that cares for his equipment pay for the repair of a careless angler?

They don't even guarantee anvils for life and an anvil is harder to break than a fly rod.
__________________
Regards,

Silver



"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy
Reply With Quote