We are happy to announce that we will be shipping the Coda X&Y with lifetime warranty.
Providing a lifetime warranty is quite a bold move – unheard of even for a startup. And that is no surprise, as it is quite a risky thing to do. In this post we will be explaining some of the rationale behind our decision in terms of lifetime warranty, the risks attached and how we try to decrease such risks. The goal hereof is not necessarily to convince others to start selling products with lifetime warranties. We do however hope that this post might inspire other entrepreneurs to think more about the quality and longevity of their products.
Companies nowadays have largely forgotten the value of a durable product. Increased durability does not necessarily lead to increased profitability. The longer it takes before a product breaks, the less repeat business a company will have. Therefore, products are intentionally made to break after a specific time frame. Such planned obsolescence is nothing new, but it has sadly almost become standard practice (which is offensive to the consumer and the environment). It is therefore no surprise that lifetime warranties are extremely rare in today’s throwaway society.
Consider the risks
Even if this was not the case however, you would not see such warranties a lot. There is a huge risk involved in providing them, as it could potentially lead to huge costs if a product would prove to break down over time. It is also virtually impossible to simulate whether or not this would be the case. After all, you would pretty much need to spend a lifetime testing the product. Still, we do not think that this means that lifetime warranties should not be contemplated. If there is any incentive that will 100% ensure that a company will make a product of great quality and durability, it is such a warranty. Even merely considering the option will likely lead to a greater focus on the quality and durability of the product.
In case of the startup, it is slightly more complicated. By nature, a startup does not have the resources or experience to fully test a product’s durability. Moreover, chances are that the startup might not exist in 10 years time… However, this does not mean that such a warranty should never be provided. There is always an inherent risk in entrepreneurship. Does that mean you should not try? As a startup there is more flexibility in organizational structure which makes it easier to consider such a warranty structure. It is also a way to add an extra type of innovation to the product and increase the trustworthiness of the startup. To be clear, that does not mean that the warranty is an empty promise made to get the consumer’s trust. We strongly believe that any startup that decides to ship with a lifetime warranty will have contemplated the viability hereof extensively. Maybe most importantly, it will also steer the startup towards durability-focussed product design.
Make a product of great quality
In our case the decision was not taken lightly. We at Coda aim to create watches in the form of a personalised relationship gift. The Coda X&Y together represent appreciation for time and appreciation for one another. We aim for the watches to be a reminder of such things whenever the customer checks the time – for the next 10 years… no decades. This is of such importance to our vision that we have decided to ship with a lifetime warranty. So how would we minimize the risks associated with this decision?
First of all, Coda’s lifetime warranty is one of a kind in that it is a relationship lifetime warranty. The warranty lasts as long as the relationship of the couple. After all, the purpose of the watches are to symbolise this relationship. To enforce this, the watches’ warranties are valid as long as they are sent back for repair together. Secondly, the watches are designed and produced with durability in mind. The largest risk is that the watches might break, so let’s just make better watches. As such, we have opted to use proven, high quality Swiss quartz movements to power our watches. These gold-plated movements have 8 jewels to ensure low and predictable friction, good temperature stability, and the ability to operate without lubrication and in corrosive environments. Combine this with high quality assembly, 316L stainless steel, high-grade sapphire glass, water and dust resistance and you have a watch that is made to last.
“the risk is that a product might break, so let’s make a better product”
Margin of safety
Of course, this increases the cost price of the product. But since the quality of the product is also increased this increase can and should be passed on to the customer. On top of that, one should also add an extra margin to be safe in case the product does break. One way to do this is to make an educated guess as to the percentage of products that might still break (remember that it is nigh impossible to actually define the exact percentage). Simply multiply that by the cost of repair and add it to the price charged to the consumer. Rule of thumb here is to find out as much as you can about the possible fault rate of your product and then make an estimate that is on the high end to have a decent margin of safety. Once in business, it is wise to establish a reserve specifically for repairs, as a sudden need for repairs at some point might get you in problems with cash flow.
Define the specifics
Lastly, it is important to define the specifics of what it is exactly that is covered by the warranty. Some well-known backpack companies even exclude normal wear (which kinda beats the purpose of the whole warranty). In the realm of watch companies there are some very high-end watch brand that offer lifetime warranties. They all require that mechanical watches are regularly serviced by a brand-affiliated service center. These lifetime warranties are void as soon as you forget to have it serviced regularly, are late or let it be serviced by a non brand-affiliated service center. We are not huge fans of such requirements and deception, which is why we have opted to use Ronda quartz movements due to their reliability even without being serviced. We will however exclude all damage not resulting from normal usage, damage to the glass (the glass is of such quality it will actually take substantial effort to break it), damage relating to the leather straps and damage resulting from leaking batteries. To ensure the latter will not be a problem, we chose a movement that has an ‘end-of-life’ indicator (or low battery indicator if you will). In addition the watch is designed with a screw back, which will significantly simplify replacing the batteries. Finally, every Coda Watch comes with extra batteries.
We believe that long(er) warranties will lead to durability-focussed product design. If you find yourself considering such a warranty, remember to:
- consider the risks.
- make a product of great quality (logically).
- add a margin of safety to the cost-price and create a reserve for repairs.
- define what you want to cover and communicate it clearly to the customer!
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