Many people use the terms warranty and guarantee interchangeably. They both add to your statutory rights and help you solve any problems you might have with a purchased product. There are, however, differences between them. From this guide, you can find out what they are, what are the benefits and disadvantages of each, and which one you should choose.
What are warranties and guarantees?
|definition||promise regarding the quality of the product assurance that the product will be fixed or replaced if, in reality, the quality or durability is not good||written assurance type of insurance policy that often isn’t free. Holds the manufacturer responsible to repair or replace a faulty item|
|what is it||commitment||formal assurance|
|what does it apply to||products, services, people||products|
|validity||can be oral or written||written|
|cost||free||the buyer has to pay for it|
|term||varies – fixed time||long term|
|can you get your money back||yes||no|
Guarantees and warranties are useful when:
- in the first 6 months after buying a product something broke and you want to make the producer replace or repair it
- you purchased an item abroad but its manufacturer is based in the UK
- the producer went bankrupt but your product is not working properly
When to use a warranty or a guarantee?
And what they mean for customers
Usually, if you found the fault during the first 6 months after buying the product, it’s advisable to use your legal rights instead. You can then use the Consumer Rights Act, which means that any products you buy must be of satisfactory quality, fit for purpose and as described.
All products must meet these three qualities:
- Satisfactory quality – products you buy should not be damaged when you get them
- Fit for purpose – you should be able to use them for the purpose they are sold for
- As described – products must match the description
If a product you purchased does not match these things, you can use your consumer rights and make a faulty goods complaint.
If you detected the fault after 6 months have passed, you can use a guarantee or warranty.
If the product turns out to be faulty after your warranty expires, you can still use your statutory rights. To make the claim you have up to 6 years from the date of purchase in England, Wales, and Northern Ireland, and up to 5 years in Scotland.
How to use a warranty or a guarantee?
- Check the procedure
Before you make the claim you should check the paperwork to find out how to do it. The warranty or a guarantee is normally included on the receipt. Alternatively, you might have received it by email, or it might have been given to you as a separate document.
- Check conditions
The paperwork will tell you when the warranty or guarantee expires, and what you’re entitled to. That can include a refund, a repair of the whole product or just its parts, or a replacement.
- Make the claim
To submit your claim you will need to provide proof of purchase. That’s why it’s important to keep all your receipts in one place. You will need to be able to show when and where you purchased the product. You will also need to explain the details of what the problem is and provide a copy of the warranty or guarantee.
Keep in mind that only the person who purchased the product can make the claim. In some cases, other people will be entitled to do it, but only if the warranty or guarantee includes the phrase ‘third party rights’.
What do guarantees and warranties mean for businesses?
Offering guarantees and warranties as a business can help you increase sales by showing customers that you can certify that the product and your service are of high-quality. At the same time, you might end up being liable for many returns and end up not making any profit from selling your products.
Ways to offer product guarantees as a business
Businesses can offer a product guarantee in several ways:
- Offer a full refund – as a business you can tell customers that if they are not satisfied with the product, they will be able to receive a refund equal to the price they paid for the item
- Offer replacement – you can tell customers that they will be able to get a free replacement of the same item if the product does not work at all or is faulty
- Offer a warranty – you can give the customers the option to pay for a warranty, hence showing them that you commit to repairing a defective product free of charge
|Benefits for businesses||improved value of their productsmaking your business appear reliable better customer trust and loyalty|
|Disadvantages for businesses||some people might only want to use the product for free and then return ithigh costs associated with repairs or replacing the productsmight affect future sales if many people claim that their items are faulty|
Should you choose a guarantee or a warranty?
Guarantees are free and can be helpful if you experience any problems with the seller. They build on your existing rights as a customer, giving you more options in case your purchased product is damaged.
Warranties are guarantees of the quality and integrity of the item. They represent the producer’s responsibility for it. That makes a warranty a more specific term than a guarantee. Moreover, warranties cover you for a longer period of time than guarantees. Often, you can be protected by them for a few years, even after the guarantee expires.
That means that, in theory, warranties are a better option. Especially when they are backed by insurance.
Downsides of warranties
Even though warranties protect you for longer than guarantees and have a more formal form, their biggest downside is that they can be pricey. The price of potential repairs is often lower than what you would have to pay for a warranty.
Most producers give you a guarantee for a certain period of time, and it is unlikely that you will discover a serious fault after that. One of the reasons why companies offer paid warranties is because they can make a profit by selling them. Guarantees are free of charge and grant you the same rights.
That’s why you should ask yourself if you really need this extra protection in the form of a warranty. You should always purchase products from reliable producers with many positive reviews. If they are trust-worthy, you will be given a guarantee that will last long enough for you to notice any problems with the item.