Adding insult to injury
A few days ago, I spoke with an RV dealer who thought he might be going crazy because he just didn’t think something like this could happen in the RV industry. He presented his case that warranty administrators for RV manufacturers and extended warranty companies are now “shopping the Internet” to find the lowest prices possible for replacement parts. That price becomes THE price they are willing to reimburse dealers to complete a warranty repair. It matters not whether the dealer will make money on the part — or even if he can get the same part for the same price. If this is true, the practice adds insult to injury for RV dealers who are already being battered by cyber stores, those “retail outlets” without walls, without standing inventory, without a trained staff and without overhead. These pretend dealers who are happy as clams to receive a 10 percent mark-up for products shipped by distributors directly to customers are the scourge of the RV industry. Yes, the Internet is a wonderful tool of business. It’s a great way to educate customers and let them know what products and services a dealership can provide. It’s also a great way to let current customers buy parts and accessories 24/7 from the comfort of their living rooms and offices.
But it takes little business skill or marketing savvy to be able to step in front of a legitimate business and announce to the world that your “company” can sell the same products for $1 less. For an industry that has been preaching customer service for a generation, the fact that these cyber stores are allowed to propagate at all adds even more insult to injury for RV dealers. Dealers are told that in order to compete they must heavily invest in infrastructure, hire trained staff and pay decent wages to keep them, send their staff to continuing education classes to maintain their skills, pay for their health insurance and give them a well-deserved vacation. Dealers are also told they must design a parts store that looks like the average Shopko, and stock it wide and deep with inventory in order to have parts on hand when customers walk through the door. For being dumb enough to follow the advice, dealers get to make monthly mortgage payments, monthly floorplan payments, annual taxes on property, bi-weekly taxes on payroll, and daily sales taxes on inventory they do manage to sell. Then, in an effort to recover some of their costs in a market where prices are being set by cyber stores, the dealers feel a need to sell extended warranties on new and used units because we, as an industry, tell them it’s profitable and that the contracts provide peace of mind for their customers. But, if dealers do sell extended warranties, it appears that some companies roll up the contracts and beat the dealers with them for wanting to charge a reasonable price on replacement parts. Shame on any wholesale distributor willing to supply a cyber store simply to move products without giving thought to whether that customer can get the item installed, whether the customer knows how to use the item or whether it’s even the right product for the customer’s particular need.
It wouldn’t surprise me if some “cyber stores” are being operated by the nephews of warranty administrators simply for their ability to set market prices on replacement parts. I can hear the administrator now. “I don’t know what you’re talking about Mr. Dealer. This very same part is available at www.cheapestrvpartsever.com for 30 percent less than your sale price. Sorry, if you think we’re being unreasonable, but it’s clear you’re engaging in price gouging. Here’s what we’re going to pay. Take it or leave it.” The dealer who already invested an exceptional amount of money in advertising to recruit the customer in the first place — instead of paying $8.95 to GoDaddy for a domain name and 2 cents to Google for a click-thru ad – take it in the shorts again. They’ll do it because their conscience requires them to do the right thing in order to keep the industry’s common customers happy. If this issue is true and the prices charged by cyber stores are being used to set replacement prices in this industry, I’d like to know which companies are behind it. I’ll be happy to shine the light on these cockroaches and send them scurrying back under the rug from which they crawled.
February 23rd, 2007 at 5:43 pm
Wow… I must claim absolute ignorance.. I had never heard of RVwholesalers.com before. Upon checking their site, and comparing their prices with my own COST prices from Coast and Stag, I can’t sell, or for that matter, buy at the same prices. I’m a small mobile RV service… and I guess I’ll be staying that way, IF I’m lucky!!
As far as the warranty claims are concerned, I agree with Steve Burgess… although I might suggest one addition. Have the client sign (especially if they’re not an old customer) a document (legally acceptable, of course) that states that they will be responsible for diagnosis charges (including teardown) if an AP is not found with the ESP. The customer could, of course, pay the difference, or go elsewhere if they chose, at their expense. (I realize there may be legalities with this, but it’s a thought)
I have had generally good relations with ESP’s in my dealings with them, but this practice would make me think twice about accepting business from them, which, in the end, hurts RV’ers, and the industry as a whole. Of course, if the ESP is insistant, one could always direct them to send the required parts, and make the customer wait for the parts to be delivered… I’m sure there’ll be fireworks for the ESP’s then!!!
Oh, for the first respondent, I agree that in some cases putting $2500 in an interest bearing account would be nice, but for motorhome owners especially, that would be woefully insufficient for a major failure, i.e. transmission, engine, etc. The diesel pusher parts are extremely expensive as is the labor to work on them. As a rule, for RV’s, I recommend ESP’s, as long as they’re reliable, especially for motorhomes.
Chris
February 15th, 2007 at 2:53 pm
I have listed below a guide of sorts that dealers may use to optimize their warranty claims. No tricks-just procedures to ensure you get every dollar that you are entitled to.
Regardless of the type of repair order system used; electronic, hybrid or paper, the dealer must be able to produce the originals or true copies of the original documents for all records necessary to support the services claimed and submitted.
The policies suggested below provide the dealer with guidelines for accurate warranty claim preparation and submission. The following procedures are to be followed by all members of the service department.
The Repair Order #1:
The repair order information obtained from the customer and vehicle must be accurate and complete. The date, odometer, delivery or in-service date, owner/operator, and contact information must be included on the repair order. There may only be one VIN per claim, except in the instance of corporate parts return claims.
The Concern #2:
The service consultant’s description of each of the customer’s concerns is to be clear and concise. Install special order part (SOP) and repair leak are not acceptable descriptions. The statement should provide answers to what, when, where and how, i.e. check front-end vibration at highway speeds when applying the brake. Concerns that are vague or written in the form of a work instruction are not acceptable, i.e. repair leaking oil pan. The customer is not to incur any diagnostic time expenses associated with a warranty repair.
The Charges #3:
At the time of repair order write-up, there must be a clear understanding of responsibility of charges. Service management must authorize any changes to the responsibility of charges. Not only is it policy, but also a courtesy to the customer, that they be made aware of any additional charges on the repair order prior to picking their vehicle up.
The Signature #4:
It must be on each customer pay and warranty repair order. Their signature authorizes the dealership to perform the requested service. A signed early bird form or electronic signatures are considered valid signature documents. The customer is to be provided with a copy of the initial repair order invoice.
Repairs performed on in-stock vehicles must be authorized and signed for by service management prior to beginning repairs.
RO Separation #5:
The technician is to only receive the shop or work copy of the repair order.
The Cause and Correction #6:
The technician is responsible for clearly and accurately documenting the cause of failure and correction for each of the customer’s concerns. The cause statement must be descriptive and contain all diagnostic codes, test results, specifications, adjustments, readings, and indicators to support the repair performed. Oil leakage is not an acceptable cause statement; rather the tech should document oil pan gasket leaking. The correction statement must be equally as descriptive.
The technician’s cause and correction statements should be transferred to all copies of the repair invoice.
Straight Time #7:
Straight time must be separately time punched and pre-approved by service management on the repair order. Technician inefficiency or lack of training does not justify straight time.
Added Operation #8:
Repair work added to the repair order after the initial write-up is considered an added operation that service management must approve. The repair order must reflect the “added operation” documentation to be valid. Technicians may not perform additional repairs without authorization, i.e. approval must be obtained to repair the noisy blower motor noticed while test-driving the vehicle for the documented brake pulsation.
The Parts #9:
The repair order must document all parts used in the repair of the vehicle. The EGR valve used to repair the service engine soon light concern should be charged out on the appropriate condition line, not with the instrument cluster replacement.
The technician should return all defective warranty parts to the parts department to be tagged, and retained. The defective area on the part should be clearly noted. Parts requested by the Warranty Parts Center that do not display a factory defect, may result in a debit to the dealer; a replaced blower motor with a mouse nest in it, for example.
The Supplies #10:
Shop supplies, materials and waste disposal fees are considered part of the dealerships fixed operation expense and may not be claimed on a warranty repair order. Brake clean is not reimbursable on a warranty repair.
Sublet #11:
The sublet repair invoice must contain the same detailed customer and vehicle header information, as does a repair order. The amount billed by the sublet facility may not exceed the amount ACC would have reimbursed the dealership to perform the same repair. The sublet invoice must reflect any discounts or allowances made available to the dealership in performing non-warranty repairs.
The repair order must reflect the repair as being performed by a sublet facility, not by the dealership.
Labor Operation Assignment #12:
Service management is responsible for ensuring the appropriate labor operation number and labor times are assigned to each warranty condition. The technician should not hold that responsibility.
Shop comebacks are the responsibility of the dealership; ACC does not reimburse for repairs performed again as a result of improper inspection, diagnosis or workmanship.
The Final Repair Order #13:
The final copy of the repair order must reflect the comments noted on the repair order by the technician. Alterations to the documentation may only be made by the repairing technician. The customer is to be provided with a copy of the final invoice that displays all of the repairs performed to the vehicle.
Approval and Authorization #14:
The service manager or director is ultimately responsible for all necessary claim authorizations and approvals. Empowerment is not to be given to any non-managerial level personnel, i.e. warranty administrator or service consultant without careful consideration. The service consultant and/or technician must obtain authorization from the service manager prior to beginning repairs that require prior approval, dealer inventory vehicles, and customer concern not duplicated repairs, for example.
Service management should be familiar with the dealerships level of empowerment.
Courtesy Transportation #15:
If the vehicle warranty provides coverage for courtesy transportation in the event the customer’s vehicle is unsafe/unable to drive, repairs will take more than one day to perform, or if repairs may not be completed due to part unavailability. The program may also be used in goodwill situations where appropriate with advance ACC approval.
The dealership may also offer shuttle, fuel or public transportation options for the customer’s convenience.
The VIN of the rental vehicle must be included on the warranty claim for reimbursement.
Parts Expediting #16:
Every effort should be made by the dealer to locally obtain a part if it is not in stock. ACC approves parts expediting to be used in the event the part is not locally available. Communication within the parts and service departments is critical in relaying the level of urgency associated with a part order, especially in vehicle down situations.
Concern Not Duplicated #17:
When the technician cannot duplicate a customers concern and no corrective action is performed, the dealer may submit a claim using labor operation numbers 9991. Whenever those labor operation numbers are used on a warranty claim, service management must grant approval.
Record Retention #18:
Supporting documentation may play a critical role in a repair procedure, especially in the case of a customer returning to the dealership to have a previously diagnosed part installed. The previous repair order should be readily accessible to support the second claim for the repair, as the diagnosis was performed on the first repair order. Service history VIN files should be retained in sequence by model year and the last six positions of the VIN or accessible by VIN if records are electronically scanned.
The documentation contained within the VIN file is a comprehensive history of all the vehicles service events, not just warranty.
Compliance begins with awareness and understanding. Familiarize yourself with each of the points and educate service department personnel to ensure that the guidelines are being followed in their entirety.
This is all available under the “warranty consulting” tab on our site as well where you may print any info you find useful.
Steve.
February 14th, 2007 at 7:50 pm
I created a solution for this at my company 2 years ago. It is real simple. You must call me for the info. or Greg give me a call and I will explain it. We are a small store with @10 Million a year in sales. The program that I do adds another 60k per. year to my bottom line. Also I always get full retail for all parts and full real time labor. Please call me I will explain. Plus I never call any extended warranty company. If you readers follow my plan they will never get screwed again.
Greg email first and I will provide you my number.
February 14th, 2007 at 12:41 pm
RV Dealers have the power to change all of this. Stop selling service contracts of the companies that operate like this.
There are more than 10 choices for extended warranty products in our industry. Most dealers simply sign up and sell for the warranty company that is the biggest or the one who pays the highest commissions without much regard to the quality of the claims processing. Everyone’s warranty coverage is almost the same these days — it is the claims processing that sets us apart.
Almost all warranty claims offices are open 8-5 Eastern Time. We all know that RVs break at Night, Weekend, and Holidays more than 8-5 Eastern. The ones that allow after office-hours repairs only re-imburse the customer and usually at @ 50% of the claim cost.
Our claims line is staffed 24/7 including all Holidays and we pay the claims over the phone, at the time of repair by credit card 7 days a week. We also pay for mobile service providers and road service providers. If they do not accept credit cards, we will Fed-Ex a company check. We may not always get them repaired during the weekend but continuous contact with, and talking to a real person during the whole ordeal of a breakdown diffuses 90% of irate service customers.
I would not normally make a commercial post in a forum but there seems to be a real need here. If you would like to try doing business with an RV company for your warranty products - instead of a pure insurance company that is trying to be in the RV industry, then you should check us out!
Anyone with questions can contact me directly by phone or E-mail.
Thanks,
Steve Burgess
February 14th, 2007 at 12:39 pm
Poppycock! (Grandma used to say that so when the opportunity presents itself, I use the word in honor of her.)
Mentioning the warranty company has nothing to do with that particular dealer getting paid.
February 14th, 2007 at 11:54 am
Folks, the dealer who alerted me to this practice was clear that he didn’t want the company named because he felt it would negatively impact his ability to get any claims approved in the future. He felt, and I agree, that it’s an issue that needs to be addressed.
I suspect there are several extended warranty companies engaging in the practice of using prices found on the Internet, rather than in catalogs, to set prices paid to dealers. If someone e-mails me or calls me with the names of those extended warranty companies, I’ll verify whether they are doing so and why.
Most people are aware of who the cyberstores are. The real issues are A) which extended warranty companies are reimbursing dealers at cyberstore prices; B) which wholesale distributors are supplying the cyberstores.
If you’d like to debate the merits of a particular company, please use our forum section for that debate. If you’d like to e-mail me the names of a specific company, you can reach me at editor@rvtradedigest.com.
February 14th, 2007 at 10:13 am
Just to clarify, I was giving an example of a situation I had with an online discounter. I named the discounter, RVWholesalers.com.
I didn’t mean to suggest that is who Greg was writing about. I just think we should discuss specifics if we are going to get anywhere in combating value erosion in the industry.
February 14th, 2007 at 9:21 am
GREG,
GREAT ARTICLE! WE AT WILKINS RV HAVE CHOSEN TO TAKE THIS NEGATIVE AND USE IT TO OUR ADVANTAGE. WE ARE CONSTANTLY EDUCATING OUR CUSTOMERS WHEN IT COMES TO CYBERSTORES. WE INFORM OUR CUSTOMERS THAT WE ARE THE EXPERTS WHO ARE ALWAYS THERE TO HELP THEM OUT IF THEY GET INTO A BIND. WHO DO YOU CONTACT IF YOU ARE INSTALLING A PART PURCHASED OVER THE INTERNET AND YOU RUN INTO TROUBLE? WHO DO YOU CALL FOR “FREE” ADVICE WHEN YOU HAVE AN ISSUE? CERTAINLY NOT THE CYBERSTORE. WHAT DO YOU DO FOR WARRANTY COVERAGE ON DEFECTIVE PARTS? IF YOU CAN CONTACT SOMEONE AT THE CYBERSTORE YOU WILL HAVE TO PAY TO SHIP THE DEFECTIVE PART BACK AND HOPE YOU GET A NEW, NOT REFURBISHED OR REPAIRED, PART IN RETURN. IF YOU BRING A DEFECTIVE PART BACK TO ME, NINE TIMES OUT OF TEN, WE WILL GIVE YOU A BRAND NEW REPLACEMENT PART.
WHAT WE NEED TO DO AS DEALERS IS SELL THE “VALUE” THAT WE PROVIDE. IT IS CRUCIAL THAT WE STRESS THIS “VALUE” TO OUR CUSTOMERS. KEEP UP THE GOOD WORK GREG.
DAVE WATT
PARTS MANAGER
WILKINS RV INC.
February 13th, 2007 at 11:05 pm
In doing some research I see that a campground in Georgia, Jenny’s Creek Campground, http://www.jennyscreek.com/layout.htm
is providing a link to this RV Wholesalers web site on the “links” page. Perhaps there is a relationship or they know something that we don’t know …. yet!
February 13th, 2007 at 8:36 pm
And the culprit is…?
Greg, can I get someone to hold accountable? If we talk in generalities then we will never get anywhere.
For example, http://www.RVWholesalers.com would not sell the Hensley Arrow at the retail price and wanted to compete on price. It is NOT a price product. It is a value product. We can’t educate the prospect on the value, and add value to the market with that education, and then compete with a web site selling at slightly over the dealer pricing.
So, who is this?
February 13th, 2007 at 6:26 pm
Greg,
To coin a phrase “Ditto” baby “Ditto”. This is just another game we’ve got to learn how to play. My company only does service on rv’s so we know all to well what is going on. We’re at the point now that we will tell our client that their extended warranty is no more than a suplemental insurance policy and that any charges not covered will have to be paid by them. 95 percent of our clients give us the “go ahead” with the repairs and call the warranty provider to give them a good ‘cussin-out! Sometimes this works and the warranty company will add a few dollars to the repair bill. We do not gouge our clients, on the contrary, our labor is often less than the flat rate book as we charge straight time but the parts are the parts and they are OUR profit and on this issue we don’t budge. Ya’ll keep doing what is right and charge for everything you find on these rv’s that is covered and the rest will take care of itself.
February 13th, 2007 at 2:31 pm
Greg:
I compliment you for raising some of the most compelling issues in our industry, and one item that you mention in this posting, I think deserves additional scrutiny - particularly from the RV Dealers who are affected by, and yet still buy from - Wholesale Distributor’s who support businesses that are primarily discount internet outlets.
Your comment…
“Shame on any wholesale distributor willing to supply a cyber store simply to move products without giving thought to whether that customer can get the item installed, whether the customer knows how to use the item or whether it’s even the right product for the customer’s particular need.”
…is one that more RV Dealers should think about. I’d encourage other Dealers to call those Warehouse Distributors, and put their money (and orders) where it will do the most good - with Warehouse Distributor’s who are unwilling to support the interenet discounters with lower prices and drop shipping arrangements.
If, and when, enough feedback gets to the participating Warehouse Distributors, they’ll decide if it’s worth losing the business of the majority of Dealers, to serve the few interenet discounters.
If that happens, the next step that’s likely, is that suppliers can choose to sell the discounters direct - or sell to consumers via the interenet themselves.
The ball is really in the RV Dealers court, for now anyway.
February 13th, 2007 at 1:23 pm
We have run into this before, it is really frustrating put all this time and effort into making a customer happy, one which probably isn’t an original buying customer and not be able to get the compensation needed to run a business. In the state of Missouri there has been legislation passed that the dealer should receive the 30% markup on warrantable parts. They get by this by manufacturer dealer exchange parts. As a dealer we should look more closely at the service company and how they service their warranty, not by how much we are able to make by selling their warranty.
February 13th, 2007 at 12:49 pm
Greg,
The problem is the business model. As long as the profit in the RV Industry is derived from the sale of upgraded counter tops, sofa’s, etc and the vehicle is just a delivery system for the profit, then we will continue to have these problems. The problem starts at the top. I have seen buyers at high end RV companies refuse to give me business because they are buying a piece of junk, they know it and I know it, because my product is literally a dollar more than what they are buying. These are essential electrical components costing in the $100 range.
Until the management at the very top of the RV industry realizes that building their coaches with the absolute cheapest components and then servicing them with these components has a long term impact, I do not expect much to change. These are the same top executives that lament the draconian lemon laws many states have passed to try to protect consumers and dealers.
February 13th, 2007 at 12:24 pm
Great Stuff!
The overall theme here seems to be related to pricing/cost of fixing an extended warranty claim, but I also see some smaller symptoms. Greg mentions…
‘It wouldn’t surprise me if some “cyber stores” are being operated by the nephews of warranty administrators simply for their ability to set market prices on replacement parts.’
In late 2005 early 2006 I had the opportunity to be part of an online RV accessories/parts operation startup. Before ya’ll go bonkers on me, let me tell you it failed … but the things I learned from that venture opened my eyes to another side of this industry.
In keeping with Greg’s mention about ‘nephew’s getting in the business’, here are some things I learned…
There are some fly by night, no overhead, litle knowledge online stores out there. They do exist, but in my experience the real price hackers are online stores setup by RV dealerships designed to have rock-bottom pricing just to sell a part/accessory in the hope that they can build a ‘relationship’ and sell an RV at some point in the future.
Some of them even create online stores as different business entities, yet use their ‘brick and mortar’ dealership to supply the parts/accessories from the larger distributors like Stag and Coast which the Internet ‘only’ stores can’t do.
So what seems like an opportunistic marketing approach to selling parts/accessories online can actually be shooting everyone else in the foot.
Kevin
February 13th, 2007 at 12:11 pm
I have a suspicion that this blog topic may attract some interest. While I truly appreciate knowing which companies are involved in this heist, we’re going to block specific company names from blog responses.
If you folks would really like to debate the merits of a specific company, please use our forums section at http://www.rvtradedigest.com/forums. You can post articles about any topic you want and we don’t moderate the posts unless someone gets really nasty and personal.
Bob Zagami’s idea of doing surveys is also good. Here’s the best part, all approved forum members should be able to create a survey when they create a new thread.
Being approved for the forums is as simple as applying. Anyone who looks legitimate is automatically approved. If there is a question about the applicant’s involvement within the RV industry, I’ll send out an e-mail seeking clarification. This important step has eliminated all spam in the forum section.
Thanks for your participation in the blog. I’ll be anxious to read your comments.
February 13th, 2007 at 11:58 am
I agree with you 90 % on this one Greg! First of all, I have to explain that my company is an RV Extended Warranty Provider/Administrator. I have worked in the RV Industry for 12 Years. We do RV, Bus, and Limos and that is it.
If the major warranty companies in our industry did not mistreat their dealers and customers this way, then there should really be no room in this industry for a guy like me to operate. They already have all of the money, marketing, and customers. But, because of their auto-based policies and complete lack of understanding of our customers and RV products, I am able to take away wholesale and retail customers from these huge companies every day. That really should not happen if they had any idea what they were doing from a service standpoint. Those companies are all run by auto industry people and bean counters so I am safe for a while.
Now, Here is the 10 % of your story that I disagree with and some of you may not like this part. It is a very regular occurance when we are paying RV repair claims that we are expected to pay whatever price the dealer makes up in his head for a part.
Our policy pays “posted shop labor rates” which are up to $150 and hour on the West coast and thankfully still $70 to $95 on the East coast and we are fine with that. Our problem comes in when we are billed for 4 hours labor and $640 for a (SW6DE 5034A) 6 Gal Suburban Water Heater for example. This claim should cost me no more than $725 plus tax ($425 part/$300 labor) but the dealer wants $1040 plus tax. If we overpay every claim by 30% then we are out of business in no time flat. By paying posted labor rates all I ask for is a fair price on the parts. Not cost-just fair. There should be something left there for the dealer at that point or they need to raise their labor rate. Many of our service providers see that model as us trying to get something for free.
There is plenty of service business to go around for everyone but many dealers and repair centers have an attitude of scarcity when it comes to individual deals/customers. Squeezing every last cent out of every last customer or warranty claim is not how to build for the long term in my opinoin.
My $0.02
February 13th, 2007 at 11:43 am
Thanks for publishing this article.
I would like to help shed some light on a particular cockroach that I have come across recently.
They just cut our labor time in half and dropped the parts cost by 28 percent. It cost our company $277.50
to help a customer that was in transit.
The name of the wonderful peace of mind selling co. is:
Thanks again for being on our side,
Jamie McFerrin
(parts mngr)
February 13th, 2007 at 6:32 am
We talked about surveys in a previous post and this might be an excellent place to put it to the test. Why not develop an electronic survey that could go to your subscribers (I suppose you could do a paper one in the printed magazine) and have the industry evaluate what appears to be a troublesome part of keeping RVers happy with their RV experience. The survey could list the various companies that fall into this category of business and then have the respondents rate the companies on cost, service, support, bad practices, good experiences and a range of othe topics that would then be used as the basis of an article to expose the problems noted here. This would hold these companies accountable and they can either learn how to do business right in this industry or let them die on the vine. This is an unacceptable business relationship that can, and will, cost the industry millions of dollars and cause many people to just abandon the lifestyle after a few incidents at the hands of companies that don’t have a clue when it comes keeping their customers happy … and by the way, their customer is the DEALER!
February 12th, 2007 at 8:29 pm
Dear Greg,
Amen to speaking the truth. I work for a very large RV dealership and it is my job to facilitate repairs for our customers with their extend service providers. I have been the warranty and extended service administration for over 12 years. I echo the first commentator on your article. The extended service companies are reading from a script as to what labor time and part price allowance they will provide for the customer. Most of the companies that administer extended service contracts don’t even know what an RV is. They are too familiar with extended service on automobiles where everything is cut and dry. It doesn’t matter if it’s a Ford, Chevy, or Chrysler the after market parts are all the same price, and the labor time to install veries only slightly from car maker to car maker. But these rigs are NOT CARS. They are a house in a hurricane and when things need repair it’s not a one, two, three repair. There are good companies out there that want to service the customer and understand that the dealer needs to make a reasonable profit to continue to service customers. As always, the few spoil the reputation of the many.
It is no wonder that the CSI for the RV industry is so low. To many companies make it too difficult for the consumer to get the services they need.
To add fuel to the fire we have aftermarket distributors that release dealer pricing to these service companies who then want to dictate what our mark up should be. I do advocate extended service contracts for protection of major components, but the industry needs to start putting these service companies in there place by voting with their checkbooks. If you have a company that makes it hard for your customer and hard for you the dealer, stop selling their contracts. Find one that has the same philosphy as your dealership culture and sell their product. We have fired many extended service companies who make it difficult for us and for our customers.
Let’s hope this forum can get a light turned on the black hole of extended service and get things changed.
M. Eckert
Warranty Manager
February 12th, 2007 at 6:28 pm
We have had troube with Good Sam’s Extended Warranty when a coverter/switch over in older units are not available and you must install seperate items. To install seperate items it must be rewired which adds about $400 to $500 for labor. They will not pay the extra hours and will pay for only to R&R the combination coverter. You can call my service manager Jim Lenard at 361-729-0031 for more details.
February 12th, 2007 at 6:28 pm
Go get’em Greg!!
From a technical service point of view, I have no great love for extended warranty companies….especially when a clerk reading from a computer screen tries to dictate to me how much time will be allowed for a given repair and how that repair should be done. When was the last time one of these blokes ever twisted a wrench on an RV of any type………………NEVER!!!
I have a black list of certain warranty companies that I WILL NOT do business with. I am right upfront with the customer about this and why. If they chose to submit a claim anyway, they are on their own. If they want me to complete the repair, then they foot the bill.
Manufacturer and OEM’s warranties are fine, but not many 2nd and 3rd party payers are OK in my book!
Lew Farber
Certified Master RV Tech
February 12th, 2007 at 5:59 pm
I wonder if these warranty administration companies shop for their healthcare, legal services, financial services in the same manner. This is a sad tale of greed, if it is true. I don’t work in that end of the business but feel that your enlightenment here deserves further scrutiny and some honest input from the dealer’s who are being financial hurt (again) by this practice.
Are these same warranty administrators going to be held liable when their cheap, imitation, or damaged good cause serious damange to an RV and perhaps cause bodily harm or death to an unsuspecting RVer who simply wanted their rig fixed and trusted the system.
Let’s expose all of the companies that are guilty of this practice and let the dealers decide who they will, and will not, do business with based on the level of service they receive and taking the aggravation factor into consideration.
February 12th, 2007 at 5:42 pm
Yes, it is happening in all market places, the worst I have seen is with some extended warranty companies, who not only set prices but tell you what to use and send the part with absolutely no mark up. Our coach manufacturers will use their part prices, which is why we try to use CM parts for CM, SB for SB, etc. I’ve been waiting for “overseas” manufacturers to jump on this market. So far I have only seen wheels which have been involved in recalls.
Hopefully the manufactures learned from that.
I personally have made a living in this industry since 1990 and am proud that I work for an individual who has been able to keep this company alive and thriving. It takes dedication and love of this industry to carry on day in and day out.
February 12th, 2007 at 5:23 pm
Hello Greg,
This a great article and one that sadly, but truly, needs to be told. As an avid RVer who has many years of RV experience and many miles over the road, I can attest to the fact that I have yet to be completely satisfied with second/third party Warranty Administration firms. I look back at the good money that I have payed out the WA firms and have yet to feel that I have received my money’s worth.
On the other hand, my experience has been nothing but very good when working with an RV dealer (even though it may not be the one who sold me my rig)in any area of the country where we may be traveling. For this reason, secon/third party WA firms do not get my business.
Product wise, we prefer to offer and carry our own warranty costs. We offer customers a very fair warranty and have experienced very little abuse of our product warranty.
Personally, RVers who pay out good money for (supposedly?) reputable second/third party warranty contracts would be better off to put $2500 in a good interest earning account and use it when necessary to repair their RV. At least they would be experienceing some reward on the good money they lay out.
Gene