Extended Product Features

Warranty

• Promise or guarantee given to a customer that a product will meet certain standards
• Series of specific promises
• Set time or use limits for coverage
• Restrict seller's liabilities

Role of warranties

• Assures consumers that products meet quality standards
• Direct companies to focus on customer satisfaction
• Require companies to adhere to performance standards
• They generate customer feedback
• Encourage quality in product development
• Boost promotional efforts

express warranties

• Warranty that is explicitly stated, in writing or verbally, to encourage a customer to make a purchase
• Warranty should be accessible to customers before the purchase
• Should be clear and understandable

full Warranty

• Warranty that guarantees that if a product is found to be defective within the warranty period, it will be repaired or replaced at no cost to the consumer

limited warranty

• Warranty that excludes certain parts of the product from coverage or requires the customer to bear some of the expense for repairs resulting from defects
• Company may pay for replacement parts but charge for labor or shipping

implied warranties

• Warranty that takes effect automatically by state law whenever a purchase is made

Warranty of Merchantability

• Seller's promise that the product sold is fit for its intended use
• Example: Lawnmower will cut grass

warranty of fitness

• Warranty used when the seller advises a customer that a product is suitable for a particular use, and the customer acts on that advice
• Example: Max towing capacity for a truck

warranty disclaimers

• Statement that contains exceptions to and exclusions from a warranty
• Limits damages that can be recovered by the customer
• Limit to purchase price
• Can waive rights if implied warranties are not followed by the consumer

role of extended warranties

• Provide repairs or maintenance beyond the normal warranty period
• Consumer pays for extra protection
• Often come with a deductible

extended product features

• Selling points for products which include: delivery, installation, billing, service after the sale, technical assistance, and training

consumer laws and agencies

• Products must meet legal requirements
• Products must be: safe, adequately labeled, and properly advertised
• Consumer affairs specialists help corporations comply with legislation

federal statutes

• Regulated by the Federal Trade Commission (FTC)
• Provides federal product safety standards

Magnuson-Moss

• Magnunson-Moss Consumer product warranty Act of 1975
• For written warranties of products over $15
• Sets minimum warranty standards, rules for warranty availability before the sale, and provisions of lawsuits against manufactures is the warranty is not honored

consumer product safety act

• Established Product Safety Commission
• Safety of non-food products
• Issues product safety alerts
• Requires warning label on packaging
• Recalls products and orders repairs
• Withdraw products and prohibit its sale

food, drug and Cosmetic act

• Products must be: safe, pure, wholesome, and effective
• Covers information labels and truthful advertising
• Food and Drug Administration
• Responsible for drugs, medical devices, food, and supplements

state statutes

• States have also issued protection laws
• Licenses and certification to practice professions

lemon laws

• Statutes designed to protect consumers from poorly built cars
• Out of service for 30 days in first year of ownership
• Four attempts have been made at repairs for the same problem
• Compensation or replacement

consumer rights

• Right to expect quality products at fair prices

Consumer Complaints

• Contact the business that sold the product or service
• If the problem is unresolved, the consumer can contact local, state, or federal offices for assistance
• If still not resolved, legal action can be taken

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