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The purpose of this paper is to present a brief summary of quality and contractual aspects for the improvement of the warranty management. Together with this, the present work will show also some of the best practices followed by companies in order to manage properly those kinds of issues related to warranty, as well as some indications to assess the implementation degree of such practices in the whole organization. Basically, the global objective of the study is to present to the reader and in few words the importance of taking into account legal and quality aspects, when a company offers a technical service for the warranty assistance of any of its products, together with the maturity level that this company achieves applying some best practices currently available.

The study starts by mentioning some antecedents related to warranty, in order to summarize a reference framework, proposed for proper warranty management, and how the information exchange should be performed among the different departments of a generic company. Then, it will be suggested how to apply this according to a strategic management which is divided in phases, taken from the product life cycle concept: Front‐end, Design and Development, Production, Marketing, and Post‐sale Support. These phases are included in three higher stages considered as Pre‐Launch stage, Launch and Post‐Launch stage, where different decisions play important roles. Afterwards, it will be shown how warranty management is viewed from the contract and legal point of view, in order to link the above mentioned topics on generic management, with those best practices currently presented in actual markets. Finally, once analysed, all those aspects related to best practices and its application on the reference framework, it is required now to quantify how a company manages the warranty assistances by a maturity assessment on warranty management.

The paper observes what today's companies are doing in this field, that is, their best practices in warranty management covering the quality and contractual aspects already mentioned, in order to round off the development of a completed framework for such management.

The paper presents a review, a framework and a practical application of the framework for the management of warranty contracts, including a maturity assessment or evaluation.

Postulates that project financing from pre‐completion marketing accentuates the tendency for the property developer to shirk from exercising the optimal level of care and effort, and leads to a higher incidence of building defects. Evaluates the disincentive effects of pre‐completion marketing against the mitigatory effects of providing defect warranty by way of a simple model of effort aversion. Derives the condition under which defect warranty can eliminate pre‐selling disincentive effects. Concludes that three policy implications follow from this model. The problem of building defects can be alleviated by imposing a longer defect warranty period; tightening building inspection standards; and limiting the extent to which developers can sell their property development prior to completion.

Product failures can lead to customer dissatisfaction, negative brand attitudes and a loss of brand equity. The purpose of this paper is to investigate whether extended warranties offer a mechanism to mitigate the negative effects of product failure and the mediating role of positive and negative self-directed emotions.

The hypotheses are tested using two 2 × 2 between-subjects experiments with product failure and warranty purchase as the two factors, attitude toward the brand as the dependent variable, positive and negative self-directed emotions as mediating variables and attitude toward warranties as a covariate.

It is found that the decline in attitude toward the brand due to product failure is greater among customers purchasing an extended warranty, than among those who do not. Moreover, positive and negative self-directed emotions mediate this relationship.

Manufacturers are for the most part not involved in distribution or administration of extended warranties, which are mainly sold through retailers and administered by companies that specialize in extended warranties. The study findings indicate that contrary to industry practice, consumer-durable manufacturers should consider more active management and promotion of extended warranties to protect their brand’s equity from the negative effects of product failure.

Various types of warranty programs are offered for consumer products. The two most common are a linear pro-rata warranty or a lump-sum warranty, if product failure occurs prior to the specified warranty time. In this chapter we consider additional types of warranty programs that allow the consumer to purchase a one-time extended warranty in the event of no failure within the initial warranty period. For the extended period, warranty may be linearly pro-rated, starting at an amount that is lower than the initial purchase price. Alternatively, for the extended period, warranty may be a lump-sum amount, that is less than the initial warranty amount. Expressions for the expected costs under each of the programs are derived. Guidelines are provided for determining the parameters of each warranty program under relevant constraints. Sensitivity analysis is also conducted to determine the effect of the problem parameters on the expected warranty costs.

The purpose of this paper is to investigate to what extent a consumer’s repair strategy impacts the annual costs of ownership of a washing machine and two types of vacuum cleaner.

The annual cost of ownership is determined by calculating the annual life cycle cost (LCC) for the respective devices. The annual LCCs of the different scenarios allow a comparison of the different repair strategy options. A Monte Carlo simulation is run to introduce parameter variability. The device’s failure rate is estimated by a combination of data sets on the devices’ performance.

Results demonstrate that the repair of the devices considered is a more favourable option over replacement. A consumer who aims for the lowest annual LCC should allow for a high number of repairs per device, without putting a maximum on the cost per repair. However, the consumer should become more cautious when a device approaches the end of its expected lifetime. Finally, the purchase of warranty can be interesting when the warranty covers a sufficiently long proportion of the device’s (expected) lifetime and when its cost does not exceed a threshold proportion of the initial purchase price.

The costs for repair might be overestimated. Future research can focus on the reduction of repair costs following self-repair.

The results provide strong arguments in favour of repair instead of replacement of broken devices.

This is the first research to quantify the influence of consumer behaviour in the context of repair of devices on the ownership costs of these devices.

The purpose of this paper is to build a warranty cost model for consumer electronics with short lifecycle and frequently upgraded process in generations. Meanwhile, a new warranty service method of replacing the failed old generation (OG) products by new generation (NG) products is proposed to cease the service capability for the OG products from manufacturers’ viewpoint.

A model is built to find an optimal time to switch to the new warranty service method to minimize the warranty cost of the OG products. The inventory cost of spare parts of OG products for warranty, repair cost and manufacturing cost of NG products are taken into account. Meanwhile, a mixed strategy is studied by providing options to customers for replacing their failed OG products with NG products by paying a discounted price of the OG products. Moreover, numerical experiments are conducted to test the effects of different parameters on the optimal solutions.

Solutions to the proposed model are discussed with analytic method and it is proved that the optimal solution exists in the considered situations. The mixed strategy considering the willingness of customers can result in the reduction of the warranty cost.

This paper analyzes the situation that more than one generations of products are in the marketplace simultaneously. Furthermore, this work makes a useful contribution for manufacturers to decrease their warranty cost by changing the service method, and provides the optimal warranty strategy for manufacturers considering the willingness of customers.

Focuses on a group of unsatisfied carpet owners. Examines the roles of the carpet warranty and the post‐purchase service received during the complaint process in terms of their effects on customers′ satisfaction with complaint resolution. Presents some suggestions for customer service policies, complaint handling procedures, and warranty fulfilment service.

Set in the newly emerging hybrid product research stream, and reflecting trends towards multi‐national production and sourcing, this paper aims to present a three‐country study on perceived quality and image of automobiles “made in and for” Southeast Asia.

The authors used a multiple cue design in the stimulus definition, reflecting assembly and component origin plus warranty level. Actual car owners were targeted, thereby adding to a relatively low number of studies requiring actual prior purchase. The related face‐to‐face interviews in the local languages resulted in 720 usable questionnaires.

Country‐of‐assembly is shown to affect perceived quality as well as perceived image. Warranty extension can moderate the quality effects to some extent, whilst buyers of luxury models display a smaller positive home bias in terms of perceived image than those of non‐luxury models. Such home region bias is not demonstrated to be significant for country‐of‐components.

The paper contributes towards ongoing theory‐building, especially with regards to an optimum level of origin cue decomposition. It also establishes the importance of adding image perception measurement to the arsenal of origin researchers normally focused on quality effects.

Managers need to make strategic decisions on the decomposition of product origin cues, reflecting consumers' abilities to notice several such cues. The selected product origin cues must then be supported with appropriate communications strategies.

For the first time, origin effects are demonstrated for the Southeast Asia region. The paper establishes the significance of country‐of‐target and contributes to research on the ever more complex product origin construct.

Warranty policies for certain products, such as automobiles, often involve consideration of two attributes, for example, time and usage. Since consumers are not necessarily homogeneous in their use of the product, such policies provide protection to users of various categories. In this chapter, product usage at a certain time is linked to the product age through a variable defined as usage rate. This variable, usage rate, is assumed to be a random variable with a specified probability distribution, which permits modeling of a variety of customer categories. Another feature of the chapter is to model the propensity to execute the warranty, in the event of a failure within specified parameter values (say time or usage). In a competitive market, alternative product/warranty offerings may reduce the chances of exercising the warranty. This chapter investigates the impact of warranty policy parameters with the goal of maximizing market share, subject to certain constraints associated with expected warranty costs per unit not exceeding a desirable level.

Construction defects in residential buildings are causing significant impacts both on consumers and the industry. As a consequence, several countries have established new home warranty schemes. However, designing a public policy for domestic building warranties can become a difficult task. In fact, many of these programs in the past have failed, collapsed or gone bankrupt. Therefore, the purpose of the current research is to provide a systematic comparative representation of various active programs internationally.

The methodology relied on a multiple-case study research design. The case selection covered a total of nine jurisdictions with compulsory home warranty programs. Those included Japan, France, United Kingdom, three provinces in Canada (Ontario, British Columbia and Alberta), and three states in Australia (New South Wales, Victoria and Queensland). The study applied a data collection protocol to gather all the evidence in a replicable manner for each individual case. Subsequently, a cross-case analysis was conducted to identify similarities and variations between programs.

The findings unveiled institutional practices that aimed to resolve, compensate, or rectify defects in residential constructions within these countries. The review mostly suggested that every home warranty program presents certain unique characteristics. At the end, this paper proposed an analytical illustration representing the diversification of components adopted by each jurisdiction.

Nowadays, there is still not a consensus within the academic community on what is an optimal solution when conceiving a new home warranty program. Hence, the current study aims to fill this knowledge gap by presenting the plurality of methods employed by several countries. This paper seeks to help policy makers and industry leaders to improve their home warranty scheme based on awareness derived from observations and analyses of what has been accomplished elsewhere in the world.