Special report: The limitations of a 100-year warranty

Special report: The limitations of a 100-year warranty
August 22, 2011

Before buying a majority stake in the Houston Astros, John McMullen was a limited owner of the New York Yankees. When asked to describe his role with the team, McMullen once said, “There’s nothing as limited as a limited partner of George Steinbrenner.”

These days, flooring retailers and manufacturers might suggest there is nothing quite so “limited” as Lumber Liquidators’ “limited 100- year warranty.”

Flooring industry executives certainly have their opinions. “100 years? Get real. Read the disclaimer. I hope you don’t get the flu,” said John Anderson, vice president of sales, BPI, the Memphis, Tenn.-based distributor. (See sidebar to this story.)

And Milton Goodwin, vice president, product management-wood, Armstrong, asked, “At what point do warranties have value and at what point are they deemed ridiculous?”

From a marketing perspective, flooring pros say the believability of a warranty is as important as the guarantee itself, and if you start to claim your warranty is so broad and so big, people won’t believe it. “People are intuitively knowledgeable that you get what you pay for. You can’t be giving me so much more than anyone else,” Goodwin said

Lumber Liquidators steadfastly defends the warranty on its Bellawood pre-finished hardwood, which is available in solid domestic, solid exotic and engineered varieties. Tom Sullivan, founder and chairman, took umbrage with criticism about his company’s warranty and said its finish test on the Bellawood line was “four times better” than other leading warranties.

Austin Adams, a sales representative for Lumber Liquidators, said Bellawood “has the thickest, strongest and most durable finish on the market today.” He called the Bellawood line “by far the most dent and scratch resistant and most durable flooring choice.”

However, long-standing flooring executives were quick to dismiss such talk, pointing to the list of exemptions on Lumber Liquidators’ warranty.

“It is fast becoming a ridiculous situation where consumers are being lured with words rather than substance,” said Luc Robitaille, vice president of marketing, Boa-Franc/Mirage. “To us, it is quite surprising that a company offers a 100-year warranty when it has barely been around for 15 years. How can it possibly expect to honor that duration?”

Speaking of Lumber Liquidators, Sam Roberts, owner of Roberts’ Carpet & Fine Flooring in Houston, said, “These guys are formidable at the low end and with the customer who wants something for nothing; they are usually the most gullible. They buy things from people who tell them what they want to hear.”

Standing behind your warranty

Mullican Flooring offers a lifetime finish warranty on selected products, according to president Neil Poland. “We do offer a lifetime moisture warranty on our products with the Aqua Shield system, which was a new product introduction this year. But we also believe 99.9% of claims will occur in the first six months. I believe the warranties give consumers confidence that the finish is durable but rarely does it result in a claim after a number of years.”

At Boa Franc, the Mirage brand offers a 25- year warranty on its finish. “But our company has been around for close to 30 years. I think that is much more credible and within a consumer’s expectations,” Robitaille said.

Sam O’Krent, president of O’Krent Abbey Flooring Center in San Antonio, said Abbey “has a wonderful approach to wear warranties on carpet with ridiculous exclusions. Basically they said that they would offer a lifetime wear warranty on any carpet given those exclusions. This allows us to show how ridiculous warranties can be because all consumers know that a carpet can wear out.”

Armstrong’s warranty talks about reasonable labor to fix the program, Goodwin said. “We don’t just change the warranty on existing products. We provide existing products with new finishes that give the consumer a much more durable surface and have upped the warranties to 50-years or lifetime, with more than just product.”

Goodwin said any time Armstrong puts an extended warranty on a product, it has changed the surface treatment to make it more durable. “We have changed the product, not just the warranty,” he said. “Armstrong always has had lifetime structural warranties—these are not new for us.”

Legacy is an important issue for consumers when they consider the veracity of a warranty, according to Roberts. “Lumber Liquidators opened its first store in 1996. Armstrong is an international, multi-billion dollar company that started in 1860. That’s a big and important difference.”

O’Krent said that when speaking to consumers about warranties, the first thing dealers can do is to communicate that any guarantee is only as good as the company standing behind it. “This helps add credence to a lifetime labor warranty since we’re a 96-year-old company compared to the new company around the corner offering a lifetime warranty.”

The devil is in the detail, according to Goodwin, who recommends that retail sales professionals educate consumers on what is in the warranty and what they are actually are getting. “You can say 100 years, but you need to know what you’re getting,” he said. “Lumber Liquidators has a 100-year transferable warranty, but you need to have a certificate of ownership. If you ever lose it, you void the warranty.”

Goodwin also noted that Lumber Liquidators’ offer for a resolution only focuses on product credit—no protection on installation. “They basically warrant wear-through—you would get a store credit to purchase new material to fix the issue.”

The web as the great equalizer

Many consumers have publicly griped about their experiences with Lumber Liquidators on various sharing forums. A consumer identified as “C” from San Antonio posted a complaint on ConsumerAffairs.com in which he claimed Lumber Liquidators never satisfied his claim about defects regarding a 1,400-square-foot purchase and installation of Brazilian chestnut. The individual concluded in his letter, “We want a complete refund of all our money: $11,000. Or we want a new floor installed with product from another company. Their warranty… is only worth the paper it is printed on.”

It is that kind of recourse that O’Krent said makes the web the great equalizer. “One of the best things the Internet brings to our industry is the ability for a consumer to do research on retailers; and in Lumber Liquidators’ case or the boxes, it doesn’t take many clicks to read the horror stories.”

As flawed as Lumber Liquidators’ exclusion-filled 100-year warranty may appear to manufacturers and retailers alike, some contend these unrealistic guarantees reflect negatively on the entire industry. “Criticizing Lumber Liquidators’ 100-year warranty still poses problems because consumers may interpret a retailer’s response as sour grapes since it does not offer the 100-year warranty,” O’Krent said.

“Unfortunately, people tend to believe what they read over what they hear—one more reason to send them to the Internet to read,” he added.

Roberts concluded that the Lumber Liquidators warranty is more about perception and marketing than any real value proposition. “Like the home centers, they will get theirs. I doubt the enhanced warranty in this case is going to move the needle.”

Reading the fine print

A key distinction in Lumber Liquidators’ 100-year warranty is not what is covered, but what is not covered*

WHAT’S COVERED

The Bellawood floor is warranted against finish wear from normal household conditions resulting in the exposure of the bare wood. It is also warranted against grading, finishing and milling defects in excess of the waste factor (the term that refers to an allowance for manufacturing and natural defects in flooring and is represented by a percentage). Accordingly, it is warranted that no more than 5% of the total square footage of your purchase of a domestic species and 10% for exotic species will exhibit any manufacturing or natural defects.

WHAT’S NOT COVERED

Moisture (or Lack of Moisture): Damages caused by moisture (such as leaking pipes, spills, wet mopping, pets, relative humidity, subfloor moisture, etc.) are excluded. Moisture (and dryness) can cause issues such as cupping, crowning, warping, buckling, peeling, twisting or gapping.

Other Site and Environmental Conditions: Defects or damages resulting from extreme indoor conditions (such as extreme heat, radiant heat or exposure to sand); indentations and scratches (caused by pets, furniture, appliances, tools, heels, toys, etc.); improper maintenance and accidents; misuse and abuse, and any wear that conflicts with the care instructions on bellawood.com are not covered.

Gloss reduction: Fading or loss of gloss is not finish wear and not a product defect.

Within the waste factor: Defects in flooring that does not exceed the waste factor are not covered under this warranty.

Poor installation: For example, damage caused by sub-surface, sub-flooring and jobsite environmental deficiencies; improper transportation, acclimation and storage; and bumps or surface dimples created by nailing machines or staples are not covered. Additionally, damages caused by any advice or instructions that conflict with Bellawood’s installation instructions and the National Wood Flooring Association’s guidelines (regardless of the source) are excluded from this warranty.

Non-traditional installations: For example, intricate patterns, installations on walls or ceilings and usages for purposes other than flooring (like furniture or countertops) void this warranty.

Boards installed with visible defects: If you see any board with defects DO NOT install it. This includes visible manufacturing, natural or other defects.

Natural wood characteristics: Wood flooring is a natural product. As a result, it may change as a result of the conditions to which it is exposed, including seasonal and environmental factors. Seasonal gapping due to the wood’s expansion and contraction in heating and non-heating seasons may occur. Color changes due to aging or exposure to UV/sunlight may also occur. In addition, natural wood variations from board to board, like differences in grain, color, tone and knots, may exist. Issues relating to these natural wood characteristics are not covered under this warranty.

Color and shade variations: New or replacement flooring may not always match samples, printed color photography (including websites and catalogs), existing flooring or other wood products (such as cabinets, stair rail- ings, trim and moldings) due to natural variations that occur by species, age, growing conditions, exposure to UV/sunlight and other factors. Consequently, these variations should be expected.

Odd lots and third-party purchases: An odd lot is flooring that is discounted because it did not pass a rigorous inspection process and is not covered under this warranty. Additionally, only purchases made directly from Lumber Liquidators in store, online or by phone are covered by this Bellawood warranty.

Special, indirect or consequential damages: Losses, damages or expenses relating to anything other than the floor itself are not covered. For example, personal damages/costs that may arise while pursuing a quality issue, such as missed time from work, hotel stays, storage fees, kennel costs for pets, etc., are not covered. Further, costs relating to the removal of defective flooring or installation of replacement flooring are not covered under the warranty. Countertops, cabinets, built-in appliances or other fixtures should not be installed on top of your floor and the cost of the removal or replacement of these items is not covered.

*Source: bellawood.com/assets/images/cust_serv/bellawood_warranty_100yr.pdf

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