Why You Should Want a Warranty Program

Offering long warranties provides many benefits including increased revenue and customer loyalty

Why You Should Want a Warranty Program

Anja Smith

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A comprehensive warranty policy can provide a critical differentiation point from your competitor. It’s surprising how few plumbing and drain cleaning companies are comfortable publishing a robust warranty program. Especially since most of us will bend over backward to correct issues. 

Most companies stand by their work. So why are we all so afraid to put that energy into a written policy? One of the toughest parts of earning new customers is establishing trust. What could send a stronger message than a firm and well-articulated warranty policy? 

An incredible warranty policy can increase your revenue, improve your close rate, build customer loyalty and act as an important marketing tool. 

You all know this phrase, “You touch it, you own it.” This mentality permeates the industry. Sometimes it’s used with a sense of pride and sometimes with annoyance, but it reflects the reality of the situation. Customers expect us to take ownership of a problem and see it through. 

So in that way, a solid warranty is leverage. It creates well-defined boundaries, acknowledges reality, and allows you to control the conversation. Instead of being frustrated that “you own it,” use this sense of ownership as a reason to increase your prices. 

Be the outfit in town that offers an incredible warranty and charges accordingly. Use high-quality materials you are comfortable standing behind. Those companies will also have a warranty to back up any issues their materials cause. 

If you are buying from a reputable dealer, there should be no problem getting manufacturer credit on the parts and maybe compensation for your labor expense. Offering a warranty means you can charge a premium. This instantly increases your topline revenue. 

If you’ve been looking for a differentiator to stand out from your competition and a reason to raise your prices — five year, 10 year, and lifetime warranties are certainly worth a 10-20% premium to the customer. Customers will decide faster and with more confidence, even at a higher price, when they know you will stand by your work. 

Basically, an extensive warranty builds instant trust and rapport with your clients. It’s hard to get a customer to pay more for vague things like quality and customer service. They want tangible value, and a strong warranty provides it.

When you accept and even embrace ownership, it sends a few very important messages to your customers. 

The contractor's argument is that if there are any problems with the installation, it’ll show up quickly: “Anything more than insert-whatever-arbitrary-amount-of-time-here of days is unnecessary.” I don’t disagree. 

But if that is true, then what is the harm in providing a longer warranty that matches the expected lifespan of the installed item? Match the manufacturer’s warranty on the labor side and your customer feels a sense of ease, confidence and security unmatched by most of the industry. It may be unnecessary, but it serves the important function of ensuring you’ll be the contractor they call out next time there is an issue. 

Warranty calls don’t always turn out to be unchargeable. We’ve all gotten a call about a “bad install” that turned out to be a completely fresh problem caused by re-pressurized lines, stirred up water heater sediment or, I don’t know, people not understanding that rebuilding their hall toilet has nothing to do with their kitchen sink clog.  

Some of you also need a warranty program in place to save you from trying to fix things that you should replace. When you take the time to write out policies around this, it will also create some guidelines for your field staff. You are putting a hefty promise behind the work you are doing, which may help them think twice before changing out the elements on a 12-year-old water heater. 

You can also offer a membership and tie your warranty period to maintaining a small membership fee each year. This means that you get that revenue slowly over time, but increase customer loyalty. When a customer continuously has their wallet out for you, they will call you for all of their plumbing and drain cleaning needs. 

“Unmatched Warranty” is a pretty great headline. If you have the best warranty in your town, you are giving a logical reason for potential customers to call you vs. your competitor. 

When you do a re-pipe, what’s holding you back from offering a transferable lifetime warranty? Before you decide I’m crazy, hear me out. 

Uponor has a 25-year warranty. Even if you aren’t using Uponor, the realistic life expectancy of PEX and PEX fittings is 50 years. Longer than almost anyone lives in any single home. 

But what about the transferrable part? OK, so the next two to three owners of that house are going to call you for plumbing issues because they will not be sure if it falls under the warranty. If the customer lives in that house for 50 years, you’ve created a customer for life. 

Worst-case scenario, you replace a few bad fittings. Best-case scenario, you have a very logical reason to increase the price of that job because of the risk you are taking off of the customer and accepting yourself. 

Because that is what all this is about, transfer of risk. That’s why a great warranty is worth higher prices. But is it that much more risk? When you get past the initial fear response of making these claims, the simplicity of it feels borderline gimmicky. After all, how many people are going to forget about the warranty, move without sharing the information or just never have a problem? 

You can put exclusions in place, like high water pressure, cutting or drilling through a line and acts of God. The extent of the fine print is up to you. Whatever lingering fear you have over this idea is healthy. But that doesn’t make it a bad idea. 

The fear about warranties is mostly unjustified, but it is important to put boundaries and bumper guards up to protect your business from vultures and fraud. Therefore, I recommend talking to a lawyer and getting a great exclusion clause written in fine print at the bottom of your invoice or membership agreement. 

The pros can quickly add up and outweigh the risk. Maybe you don’t have to go all the way to a transferrable lifetime warranty, but consider pushing a bit past your comfort zone. Or at least past your competitor’s comfort zone. 

About the Author

Anja Smith has worked in the plumbing industry since 2012 in Greenville, South Carolina. You can find her on LinkedIn at www.linkedin.com/in/anjasmith.


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