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Extended Service Plans

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  • Extended Service Plans

    As i've said before i work in the Home Depot Hardware department and we offer Extended Service Plans (ESP) there. Management is always pushing us to push these and sell more of them because it's pretty much mostly profit. I'd got my own personal opinions about these plans but i'm always curious about waht other peoples opinions of these are. Of course these don't make sense when purchasing a ridgid tool but i'm talking about other brands that we sell. I'll give just a quick summary of the costs and such of them so you can get an idea.

    For anything under $299 it's a 1 year replacement of the tool which begins on the purchase date. This means if it breaks within 1 year of buying it bring it back to home depot and we give you a new one on the spot no questions asked.

    For anything over $299 it's an extended warrenty. There is a 2 year and 3 year extended warrenty and this starts after the manufacturers warrenty expires so a dewalt tool with a 2 year warrenty and you buy a 3 year esp you'd get 5 years of coverage. For this type of warrenty it involves repair of a defective tool which is either shipped out by the customer of by home depot for the charge of shipping.

    All of these plans range from 10-20% of the cost of the tool

    So i'd really appreciate any comments on these plans; pros/cons your opinions, what tools you'd consider buying it for what you would and the like. I'm just trying to get an understanding of what a customer thinks when being offered this service.


  • #2
    I have had several ESP's, mostly on appliances. I once had one on a laptop computer and when the laptop went "south", I called the service to arrange for shipment and repair if the item. The person I talked to did not seem to be that knowledgeable about this computer and after several attempts at explaining my dilemma, I became irritated and asked him if he had ever seen a computer before. That was a mistake! He declared I had abused the laptop and therefore my warranty was void. Nothing I could do would rectify the situation so I was out in the cold.

    I subsequently sent the laptop off for repair, asked the repair service to determine if the unit had been abused or not and got an answer saying it had not been, but the ESP was still null and void.

    Perhaps I could have sued but believe it would have been far too costly and I dont believe in "making a point when it costs more than the repair".

    My overall experience with ESP's is that they are good for the consumer but not that cost effective, most consumers simply dont have the cash to lay out at the point in time a breakdown of the item occurs. I believe your comment about them being a very profitable item for the seller is true.

    It is impossible to make anything foolproof because fools are so ingenious.


    • #3
      I tend to agree with Jerry. I must admit that I have bought several tools from HD in the past couple of years and have yet to ge offered an ESP though. I have been offered at other stores on appliances and such as Jerry mentioned. I personally agree that buying one on an appliance can be worth it at times, but after quite a bit of research before we bought our new fridge/stove/washer/dryer we found that most often the appliance will last with no problems beyond the ESP before it needs work. So I did not buy one on them and will admit my fridge had a problem with the light over the water dispensor just after the warranty expired so I have not gotten it fixed! We passed on the ESP due to the overall cost. Everything else is running just fine though.

      For laptops, computers, or other "technilogical" type items I would not buy an ESP. Normally the technology is going to be replaced before the item needs work, unless the item breaks during the standard warranty. An exception would be the very few times an ESP will also cover theft. You will find that many people will disagree with that, but is MHO.

      Jerry, having worked with many brands and lines of equipement in my years in the field, I am just slightly curious who did you so wrong on your laptop? What brand was that laptop?

      Still enjoying all 10 fingers!


      • #4
        IMO, extended warranties/service plans that you have to pay for are, in most cases, a waste of money. The only exeption may be for a motor vehicle and that is even stretching it. My guess is that the number of people who would actually have to use one after a purchase is so small that it would be hard to justify the expense. And, if the number was high enough to justify the purchase of an extended plan than I would have to question the wisdom of purchasing the product in the first place.
        I decided to change calling the bathroom the "John" and renamed it the "Jim". I feel so much better saying I went to the Jim this morning.


        • #5
          While I have purchase several power tools from Home Depot over the last couple of years, I have only been asked a couple of times, if I was interested in the service plan. For me it wouldn't make a lot of sense, but if I was in the business and needed that particular tool on a daily basis, having the ability to just "exchange" it would be great insurance. However, just to add additional warranty service time would seem of little value, unless there was some exchange or expedited service time included.

          On appliances, I agree that it is rarely worth the, often expensive, plan; as in most cases the unit will either fail during the normal warranty period or it will last practically forever.

          Noting SteelWoodworker's experience with his laptop being arbitrarily labelled as "abused" by a customer service tech... that is a common ploy that too often used in the industry; and frankly, it borders on fraud! When you have such an agreement, there should be little or no questioning about handling the service and it should be done within a normal time frame. I know that I have mentioned this on other forums, but when face with such fraudulent behaviour a viable alternative (to getting an attorney and trying to sue), is your state Attorney General's office. The S.A.G. usually has offices in most large cities and it is usually just a matter of filling out a single page form and supply them a copy of your contract, reciept, or other paper-work involved in whatever your greivance may be. The A.G. can often settle the dispute with a simple phone call (no company want to be investigated or prosecuted by the State Attorney General's office). I have used this process on two occasions (one just last year), and have had great success. There is usually no cost to you.