Are optics warranties TOO good?

[RMM]

As you probably already know, there is tremendous markup on optics. I have a friend on the inside at Vortex and can get me anything they carry for 50% off, so that means there is probably another 25% to play with there. If 10% of their products fail, and they replace them, they still have a large profit margin.

The markups vary across the board for optics companies. I work at an archery shop that also has sister stores that carry guns and optics. I get everything at cost. The markup on Nightforce isn't even remotely close to what it is on Vortex and Leupold.

 

[JGRaider]

So as a consumer you will purchase optics from this company based solely on this, or does quality of the product factor in? Intrigued as I think most of us want a product that preforms as advertised. I like great CS as much as the next guy, but in the end, I work hard for my money and I don’t want to spend it on faulty equipment.

Of course quality comes into play. You ever used a Razor HD, UDH, or Fury AB? I've never owned one of their scopes.

 

[JGRaider]

look at the quality drop from manufacturers that offer it. It’s nearly all coming from china or worse because the warranty costs are mounting.


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The market will decide what's too expensive, a poor value, etc just as it does with every other product on the planet.

 

[Kurts86]

When I worked for a consumer products manufacturer our tolerated warranty rate was 2-4% and we were spending maybe 10-20% the product MSRP on the average warranty issue. It isn’t a significant part of the business cost maybe 1%. It’s cheap marketing and not high cost.

 

[Wheels]

The markups vary across the board for optics companies. I work at an archery shop that also has sister stores that carry guns and optics. I get everything at cost. The markup on Nightforce isn't even remotely close to what it is on Vortex and Leupold.

I’m assuming your “cost” and the manufacturers cost are 2 completely different numbers.

 

[CorbLand]

I think the number one "mistake" you are making in your thinking is that people always build business with long term, generational plans. Sometimes they are built to gain market share and be sold or go under.

 

[WRO]

Of course quality comes into play. You ever used a Razor HD, UDH, or Fury AB? I've never owned one of their scopes.

Yes and their QA/QC is shit..


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[RMM]

I’m assuming your “cost” and the manufacturers cost are 2 completely different numbers.

Absolutely, my cost is the wholesale price that the manufacturer sells the optic to the distributor at. Still, my point remains that the MAP markup is significantly more for some brands.

 

[Buglebrush]

My Razor UHD 18x56 and 10x42 were such huge investments at my income level that the VIP No Fault warranty is absolutely necessary for me to commit that kind of money. I wouldn't even consider dropping Kowa or Swaro money because they didn't have it. If you make enough money that a pair of NL Pures are not a once in a lifetime purchase then I can see you seeing it differently.

 

[JGRaider]

Yes and their QA/QC is shit..


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With specific regards to the Razor HD, UHD binos, why do you have that opinion? The Fury AB's I've had for 3 years run circles around the 3200.coms with the exception of pure optics. Love to hear your reasons for your opinion, as I have 3 Swaros, a Meostar, and GR HD for reference.

 

[Macintosh]

When I worked for a consumer products manufacturer our tolerated warranty rate was 2-4% and we were spending maybe 10-20% the product MSRP on the average warranty issue. It isn’t a significant part of the business cost maybe 1%. It’s cheap marketing and not high cost.

This is spot on. 2% is a pretty average return rate for most of the consumer goods I've worked in, that includes everything from catastrophic failure to I "changed my mind", but I know many goods its higher. Many retailers sell the unused returns as open boxes becasuse newish but off-price stuff can be in high demand, and the manufacturer can also use those as warranty replacements. So they actually arent replacing all of the returned scopes, or if they are they are often replaced with refurbed ones or cosmetic blems, etc, OR they have a "quality" agreement with the factory to buy replacements at a lower price.

On a $1000 item, at a keystone margin the retailer pays $500. The manufacturer probably makes a 30% margin, so their cost on that item is $350.
If they sell 2000 units at $500 each, they gross $1,000,000. A 3% return rate is 60 units they have to replace (again, they dont have to replace all of them so this is a high estimate). At $350/ea their cost to replace those 60 scopes is $21,000, or about 2% of their gross. That is very significant, but it's FAR, FAR cheaper than the advertising it would take to sell the same # of scopes without it. A lot of these companies spend up to 20% of their gross revenue on marketing....vortex decided theyd take 2% of that MARKETING budget and changed the whole consumer expectation by doing so, in a manner that put some other companies scrambling to react to.

makes perfect sense to me. The math looks different for every company, and I cant say whether its good or bad for consumers--probably some of both--but I highly doubt their return policy is causing their manufacturing quality, or vice versa. It's simply the thing they brought to the market to set themselves apart, and it worked.

 

[Side-Swipe]

I think that for the most part it balances out because many will not actually make use of the warranty.

 

[bojangles808]

If everything vortex made was crap then it wouldn't matter. but they make a good enough product (or at least some lines) where consumers are still happy and still perceiving value without needing to use the warranty.

 

[Fireflyfishing]

Of course quality comes into play. You ever used a Razor HD, UDH, or Fury AB? I've never owned one of their scopes.

I have an older pair of Viper HD binos. They work and haven’t broken…yet. They will soon be turned into a truck/boat bino. I’m looking into some Alpha binos and the Razor UHDs were a consideration for a short period, but I’m going to splurge and go with the true alpha binos.

Interestingly enough, Vortex started as a bino company but grew and branched out…

I don’t hate Vortex. I want them to make better stuff AND have their kick butt warrantee. Other guys want the same from Leopold.

In the end, I want to buy a product that works for me in the field. That is the primary purpose handing Vortex or others my money. The good CS and warrantee are a cherry on top. It shouldn’t be me handing them money because they have good CS and a warrantee and then maybe I get equipment that works…

 

[Weldor]

I am in some agreement on no fault warranties. I would like to see two levels of warranties/ insurance available to buyers of new scopes. One or both could be transferable with a small fee to cover the registration of the transfer.
1) The manufactures warranty against manufactures defects and failure.
2) A no fault insurance policy for obvious damage with a small deductible.
As with anything there would be some headaches and exceptions.

Absolutely, I fell on RS's favorite brand starts with a L ends with D. They fixed it and returned it no charge. Had 2 other failures from years of service and hard knocks from another brand. Both were replaced with new . I never asked for that type of customer service, offered to pay for repairs etc. I have no compliants with lifetime warranties. The sad part is if you do need a new product most likely it won't be made in the same country as the original. They start out with Japense quality and move production to other countries. Not all but more than a few.

 

[WRO]

Absolutely, I fell on RS's favorite brand starts with a L ends with D. They fixed it and returned it no charge. Had 2 other failures from years of service and hard knocks from another brand. Both were replaced with new . I never asked for that type of customer service, offered to pay for repairs etc. I have no compliants with lifetime warranties. The sad part is if you do need a new product most likely it won't be made in the same country as the original. They start out with Japense quality and move production to other countries. No all but more than a few.

When they go the shit in on a hunt, the warranty seems pretty pointless imho.

 

[JGRaider]

When they go the shit in on a hunt, the warranty seems pretty pointless imho.

Sounds like a couple of 3200.com's I had. Key word.....HAD.

 

[cuerro viejo]

Since this is your 2nd post on the same subject, I guess I didn't realize people actually wasted their time thinking about this situation. Plenty of products, plenty of companies selling optics for any price point the customer wishes to pay. Buy what you want.

Leupold wrote the book on customer service and warranty offerings years ago. Swaro came along and adopted the same lifetime transferrable (without no fault), then years later along came Vortex who adopted it as well and took warranty and customer service to another level. Since they've become the largest optical seller in the USA (probably worldwide) and obviously know how to make money, I'd say their business model is an unprecedented success whether anyone here likes it or not. The way they handled the Liberty Optics meltdown/screwing their paid customers tells me Vortex is a company that I'd support in a heartbeat. Name one other optics company that would have gone to bat for their customers like Vortex did.

Swaro isn’t lifetime just FYI. They won’t warranty any of swaro habicht’s

 

[TheWhitetailNut]

My Razor UHD 18x56 and 10x42 were such huge investments at my income level that the VIP No Fault warranty is absolutely necessary for me to commit that kind of money. I wouldn't even consider dropping Kowa or Swaro money because they didn't have it. If you make enough money that a pair of NL Pures are not a once in a lifetime purchase then I can see you seeing it differently.

I get that perspective. In 2008, I bought a pair of 10x42 EL's. I had absolutely no business buying them at that time but I did confident I would never need the warranty. I really believed they would last me a lifetime of adventure. Thankfully they held up and I never needed No Fault coverage, but I get the attraction.

 

[WRO]

I get that perspective. In 2008, I bought a pair of 10x42 EL's. I had absolutely no business buying them at that time but I did confident I would never need the warranty. I really believed they would last me a lifetime of adventure. Thankfully they held up and I never needed No Fault coverage, but I get the attraction.

They typically just charge for parts which is rather inexpensive considering the value of the product and work done. I have used the warranty process a few times for stuff I have broken on myself and it’s not been bad.