Buyers Beware: Costco's Unreliable, Unclear Guarantee

[arf1410]

I'm confused ...why are you unwilling to spend a few hundred bucks to repair a 4 year old, $7,000 item? Do you have reason to believe the repair costs will be in the thousands?

[db3808]

I'm confused ...why are you unwilling to spend a few hundred bucks to repair a 4 year old, $7,000 item? Do you have reason to believe the repair costs will be in the thousands?

Can you guarantee that it'll be "a few hundred bucks"? Do you have reasons to believe the repair costs won't be in the thousands? Maybe you are a repair guy and know spas inside out. I don't. So I'm not going to start messing with it. I thought there was a warranty in place so I didn't want to touch it in case it would void the warranty. That's why I contacted Costco first.

What's with this forum and folks just automatically ASSuming things?

[hot_water]

Well, it's not my place to judge, but since you asked for an opinion....

Yeah, after reading your post, you're being unreasonable. You claim that you didn't know what the warranty was. Isn't it in the documentation that came with the spa? Wasn't it on the website? Honestly, it seems like you're blaming Costco or Watkins because you didn't know what the warranty was on the product. Isn't that unreasonable?

You called Costco wanting the repair covered. Had they agreed, you would have been happy. Nothing in the post says you weren't satisfied with the spa, you just wanted someone else to pay for the repair. Then, when Watkins wouldn't cover the out-of-warranty repair, you wanted Costco to take it back. But clearly you weren't really dissatisfied with the product, you were just unhappy that you didn't get a free repair.

Costco's return policy is supposed to protect the members from getting stuck with products that don't work as they should, are lemons, or otherwise don't provide the expected value. If your shell cracked,the cabinet frame rotted out, or it was breaking down frequently, Costco would take it back. No one else has anything close to that policy. But that doesn't mean that you get lifetime free repairs! That's unrealistic.

So yes, I think you're being unreasonable. Sorry, but you asked.

As for Phyllis, I dialed the Customer Service number on the Costco website. Select the phone menu option for "return your order". If you aren't routed to the Yakima office, tell whoever answers that you want Phyllis on the resolution team in Yakima. I don't think you have a very good argument, but it's worth a try.

[DK117]

Maybe you are a repair guy and know spas inside out. I don't. So I'm not going to start messing with it. I thought there was a warranty in place so I didn't want to touch it in case it would void the warranty.

So after several other threads and two years of debating the Costco spa distribution model, I'm going to offer my opinion. The conclusion of my opinion is that going the Costco route requires a certain amount of DIY. Whether that's the electrical, chemicals, or 4 year old heaters, eventually you're going to have to mess with the tub and touch it. I mean that with utmost respect, I suggest you pay for the repair and enjoy your tub for another 4 years.

Good luck.

DK117

[arf1410]

This seems almost like a bizarre discussion. I don't understand why there is an issue before a repair estimate was ever received. If ANY expensive product breaks, that one doesn't have the ability to fix themselves, if it is under a warranty one calls either the manufacturer's warranty support line, or the party that provides the warranty, or if it is not under warranty, one calls a professional to get a bid for repair so one can make a repair v replace decision.

As far Spas, I wasn't aware of any single repair, other than the shell, that could be over $1,000...but I'm not pro, that's why I would call one!

As far as Costco's policy...for example, I bought a portable DVD player there, about 4 years ago ( but AFTER the 2 year return for electronics was put in place). The rechargeable battery pack died after 3.5 years...I would consider that normal wear and tear...I look all over the internet for a replacement to buy...none available...only then did I call costco and ask for help to BUY a new battery pack. They got back to me a few hours later and stated they couldn't find them either, and offered me a full refund...I didn't even ask. That was above and beyond reasonable. Your desire for a refund without even attempting to bring in a repair professional is not.

[db3808]

hot_water, DK117 and arf1410 ... thanks for the opinions and responses.

I think this is a case in which expectations are different. I'm not in the spa industry so perhaps my expectations on the spa quality were higher - or even unrealistic. If you're in the spa industry (or you're knowledgeable about spas) and have seen how often they need servicing, then perhaps your expectations would be different.

As a consumer, I thought it was weird that the same heater (assuming that it is the heater that's defective) has a 1 yr warranty when it's installed on one product and a 5 yr warranty when it's on another.

I'm still sticking with my original feelings: Costco's guarantee is unclear and unreliable. My local Costco had a BMW parked in front of it with a sign saying something like, "Savings for Members". Since I am in the market to buy a new vehicle, I started looking into what they had to offer. Now, I'm going straight to the BMW dealership. Same with a washer and dryer. I still love Costco but I'm never going to purchase anything major from them again.

[Dr. Spa]

"As a consumer, I thought it was weird that the same heater (assuming that it is the heater that's defective) has a 1 yr warranty when it's installed on one product and a 5 yr warranty when it's on another."

Not weird at all. A warranty is NOT free. It's an "after sale" expense the manufacturer figures into the initial cost. Some percentage will fail within 1 year, some percentage 2 years, some percentage 3 years, etc. By lowing the warranty time, you lower the manufacturers costs, thereby lowering the initial cost of the spa to the consumer.

A warranty is NOT free! YOU the consumer PAY for it.

You want to pay less for a spa? Something has to be omitted from the manufacturers costs.

[db3808]

"As a consumer, I thought it was weird that the same heater (assuming that it is the heater that's defective) has a 1 yr warranty when it's installed on one product and a 5 yr warranty when it's on another."

Not weird at all. A warranty is NOT free. It's an "after sale" expense the manufacturer figures into the initial cost. Some percentage will fail within 1 year, some percentage 2 years, some percentage 3 years, etc. By lowing the warranty time, you lower the manufacturers costs, thereby lowering the initial cost of the spa to the consumer.

A warranty is NOT free! YOU the consumer PAY for it.

You want to pay less for a spa? Something has to be omitted from the manufacturers costs.

That's not Costco's model. Costco is not about "you get less if you pay less". If you want that model, go to Walmart.

The day that Costco starts doing that is the day I end my membership with them. Costco is all about "getting more while paying less". That goes for the product quality, quantity ... anything. Perhaps they goofed up when they negotiated with the spa manufacturers but I expect that Costco, with its purchasing power, can negotiate better terms for its members.

As a Costco member I would never settle for the, "You want to pay less ...? Something has to be omitted ..."

[arf1410]

I bought a gas hot water tank at Home Depot a few years back...from the same manufacturer there were choices of models with an 8, 10 and 15 year warranties at increasingly higher price points. Initially I assumed the ones with longer warranties were designed to better standards, ie to last longer. Later I learned that they were mechanically identical. The higher price points were in effect buying an extended warranty. As any good consumer knows, an extended warranty is buying insurance on a product. By definition, and on average, you will loose money on insurance, so only insure items whose loss you cannot afford.

So it is certainly plausible that the mechanically identical heating element has a 1 year warranty when sold at one store (or brand name) and a different warranty when sold at a different store. Of course it is also possible they are different.

and Dr. SPA "You want to pay less for a spa? Something has to be omitted from the manufacturers costs." ...maybe, maybe not...it could be lower manufacturing costs or lower marketing costs or lower retail markup or shorter warranty or any combination of the above. Manufacturing costs is only one element that goes into a retail price.

[spatech (the unreal one)]

You would be wrong. You "think the return was denied because ..." ... Haha .. you rather ASSume things than read what actually happened?

If you bother to read the correspondence between me and the Costco rep then you would realize that I did ask Costco to fix the issue. Only after they denied did I pursue the return course.

I didn't read your post closely enough; I guess yet another person letting you down.

You ASSume that you are right in all this, that you understand how warrnties work, how they are packaged with the item and who pays for it but clearly you are mistaken.

You have a feeling of entitlement with the spa and your unwarranted request for its return due to a wearable part failing (and failing in a time frame not all that uncommon). Time to get your repair done.

BTW, it might not be the heater itself. It might be the heater board within the control box, also a simple fix for a reapir guy or a true DIYer (as every Costco spa owner should be).

[arf1410]

SpaTech - not sure I understand this statement "also a simple fix for a reapir guy or a true DIYer (as every Costco spa owner should be). "

Why does a Costco spa purchaser need to be more of a DIYer than a non Costco Spa purchaser? No matter where the spa comes from, once the warranty is over, your choice is either fix it yourself, or hire a professional to fix it.

[db3808]

You would be wrong. You "think the return was denied because ..." ... Haha .. you rather ASSume things than read what actually happened?

If you bother to read the correspondence between me and the Costco rep then you would realize that I did ask Costco to fix the issue. Only after they denied did I pursue the return course.

I didn't read your post closely enough; I guess yet another person letting you down.

You ASSume that you are right in all this, that you understand how warrnties work, how they are packaged with the item and who pays for it but clearly you are mistaken.

You have a feeling of entitlement with the spa and your unwarranted request for its return due to a wearable part failing (and failing in a time frame not all that uncommon). Time to get your repair done.

BTW, it might not be the heater itself. It might be the heater board within the control box, also a simple fix for a reapir guy or a true DIYer (as every Costco spa owner should be).

Thanks for the total BS response. Hahaha ... this says it all: or a true DIYer (as every Costco spa owner should be).

Another person who thinks Costco = Walmart. That's hilarious.

[spatech (the unreal one)]

Another person who thinks Costco = Walmart.

Where did that statement come from?

A sense of entitlement, a lack of understanding of who pays the cost of a warranty and a know it all. Good luck with returning your spa. You might want to return that light bulb to Costco that burned out after a few years after use while you're at it.

[db3808]

Another person who thinks Costco = Walmart.

Where did that statement come from?

A sense of entitlement, a lack of understanding of who pays the cost of a warranty and a know it all. Good luck with returning your spa. You might want to return that light bulb to Costco that burned out after a few years after use while you're at it.

You might want to run to Walmart to get your dinner now.

[waterbear]

If this thread does not remain civil I will lock it and possibly issue some warnings. No name calling and insults please!

[Roger]

That's not Costco's model. Costco is not about "you get less if you pay less". If you want that model, go to Walmart.

The day that Costco starts doing that is the day I end my membership with them. Costco is all about "getting more while paying less". That goes for the product quality, quantity ... anything. Perhaps they goofed up when they negotiated with the spa manufacturers but I expect that Costco, with its purchasing power, can negotiate better terms for its members.

As a Costco member I would never settle for the, "You want to pay less ...? Something has to be omitted ..."

Hahahahaha, Yet another who thinks there's some kind of majic in the Costco business model! American business is about making money and no one, not even Costco can drive manufacturers to sell their product for less than the manufacturers intended. So cheapining it up for Costco is SOP whether we think so or not. Check manufaturers part numbers of product at Costco versus other stores, for the same model. Start with TV's

You can't have a Mission without a Margin!!

[DK117]

"You want to pay less for a spa? Something has to be omitted from the manufacturers costs." ...maybe, maybe not...it could be lower manufacturing costs or lower marketing costs or lower retail markup or shorter warranty or any combination of the above. Manufacturing costs is only one element that goes into a retail price.

It's not just about checking part numbers.

DK117

[db3808]

Hahahahaha, Yet another who thinks there's some kind of majic in the Costco business model! American business is about making money and no one, not even Costco can drive manufacturers to sell their product for less than the manufacturers intended. So cheapining it up for Costco is SOP whether we think so or not. Check manufaturers part numbers of product at Costco versus other stores, for the same model. Start with TV's

You can't have a Mission without a Margin!!

Hahahahahahahhahahahahahahhaha!!!!!!!!!!! (thanks for the laughs) Yet another that should stick to pool service and not wander into the world of how real business is accomplished. Let me give you some examples of products that are identical to other places, yet cost less (I put some TVs in since you seem familiar with them). You can dwell on this while you go down the discount aisles at Walmart.

- VIZIO M470VT 47” Class Edge Lit Razor LED LCD 120 Hz HDTV ($649) - go ahead and tell me what parts in this model is cheaper

- Movie tickets - do Costco members have to sit in the back of the theater since we didn't have to pay full price

- Casio XJ-A230G Laser Projector - maybe they switch out the premium lasers for Costco?

- Panasonic 60" Class 1080p Viera Plasma HDTV, model TC-60PS34 ($999) - I know, inferior products substituted to get the lower price

Yeah, keep spreading the FUD. After a while, only you and your fellow service techs will believe it.

[hot_water]

"You want to pay less for a spa? Something has to be omitted from the manufacturers costs." ...maybe, maybe not...it could be lower manufacturing costs or lower marketing costs or lower retail markup or shorter warranty or any combination of the above. Manufacturing costs is only one element that goes into a retail price.

It's not just about checking part numbers.

DK117

I agree with DK on this. Sometimes, the part number on Costco items is different. Usually it's because the product is packaged differently or comes in a different size container. Very often the Costco version of a product will have some extra stuff in the package... for example, a TV might include an HDMI cable that the same TV sold at another retailer doesn't include - hence, it will have a different part number. This is not uncommon with mega-retailers.

I disagree on the DIY stuff. You don't have to be a home mechanic. You call them, they send someone. Same as any other spa. A few months ago, I a needed a gasket, and Strong (the maker, not Costco) scheduled a tech to come out to install it. No muss, no fuss. As it happens, I cancelled the appointment and installed it myself... far easier than having to be tied to the house waiting for the service guy, something that I just don't have time to do. Is this support model faster or slower than a dealer? I don't know. It probably depends on the dealer. One thing I do know is that no one complains about Strong Customer support on this forum. That may or may not be true with the Watkins, or the CalSpa products Costco also has been selling. There has to be some advantage to a dealer... maybe quick response support is it. OK, fine. You pay for that as part of the higher price. Hopefully you won't need too many service calls anyway. In any case, it doesn't mean that you have to be a DIYer to own a Costco spa.

I also agree with DB3808 on Costco. It's a completely different business model than Walmart. They don't derive their profits the same way at all, and thus their marketing and CS strategy is different. This has been gone over dozens of times in this forum, you either get it or you don't. Costco, as DB3808 says, generally offers more for less. Their markup is lower than most other retailers because they have lower overhead and because they derive their profits primarily from membership dues (read the quarterly report - not the text, the financial statement - and you will see this for yourself). Their motivation is, therefore, to offer the best deal to the member and keep them happy, so that he/she will want to re-up every year. That's why Costco is unique. Most of the time they succeed in offering products that are a great deal, but not 100% of the time. No one is perfect.

On the other hand, warranty is in fact a priced item. Warranty service costs money. In general, companies price warranties based on statistics of historical failure rates and their internal cost associated with performing on the warranty. And they make profit on them, too. There are textbooks on the subject of pricing warranties (I have one that I use all the time!).

In any case, it sounds like you "assumed" that the Watkins model you bought would have the same warranty as the dealer Hot Spring. Your spa was not offered as a Hot Spring, but as "from the maker of Hot Spring". Your initial asumption might have been a reasonable mistake... but it was nevertheless a mistake. And not, really, Costco's fault or Watkin's fault - they didn't hide the warranty or misrepresent the product, after all. Chalk it up to tuition for the school of hard knocks. Get your spa running and go out and relax in it.

[db3808]

I agree with DK on this. Sometimes, the part number on Costco items is different. Usually it's because the product is packaged differently or comes in a different size container. Very often the Costco version of a product will have some extra stuff in the package... for example, a TV might include an HDMI cable that the same TV sold at another retailer doesn't include - hence, it will have a different part number. This is not uncommon with mega-retailers.

I disagree on the DIY stuff. You don't have to be a home mechanic. You call them, they send someone. Same as any other spa. A few months ago, I a needed a gasket, and Strong (the maker, not Costco) scheduled a tech to come out to install it. No muss, no fuss. As it happens, I cancelled the appointment and installed it myself... far easier than having to be tied to the house waiting for the service guy, something that I just don't have time to do. Is this support model faster or slower than a dealer? I don't know. It probably depends on the dealer. One thing I do know is that no one complains about Strong Customer support on this forum. That may or may not be true with the Watkins, or the CalSpa products Costco also has been selling. There has to be some advantage to a dealer... maybe quick response support is it. OK, fine. You pay for that as part of the higher price. Hopefully you won't need too many service calls anyway. In any case, it doesn't mean that you have to be a DIYer to own a Costco spa.

I also agree with DB3808 on Costco. It's a completely different business model than Walmart. They don't derive their profits the same way at all, and thus their marketing and CS strategy is different. This has been gone over dozens of times in this forum, you either get it or you don't. Costco, as DB3808 says, generally offers more for less. Their markup is lower than most other retailers because they have lower overhead and because they derive their profits primarily from membership dues (read the quarterly report - not the text, the financial statement - and you will see this for yourself). Their motivation is, therefore, to offer the best deal to the member and keep them happy, so that he/she will want to re-up every year. That's why Costco is unique. Most of the time they succeed in offering products that are a great deal, but not 100% of the time. No one is perfect.

On the other hand, warranty is in fact a priced item. Warranty service costs money. In general, companies price warranties based on statistics of historical failure rates and their internal cost associated with performing on the warranty. And they make profit on them, too. There are textbooks on the subject of pricing warranties (I have one that I use all the time!).

In any case, it sounds like you "assumed" that the Watkins model you bought would have the same warranty as the dealer Hot Spring. Your spa was not offered as a Hot Spring, but as "from the maker of Hot Spring". Your initial asumption might have been a reasonable mistake... but it was nevertheless a mistake. And not, really, Costco's fault or Watkin's fault - they didn't hide the warranty or misrepresent the product, after all. Chalk it up to tuition for the school of hard knocks. Get your spa running and go out and relax in it.

hot_water, I find your responses very fair (and refreshing). My mistake was thinking that Costco's satisfaction guarantee went above and beyond anything the manufacturers offered -- kind of like how credit card companies provide travel insurance above and beyond your existing one.

I am very familiar with insurance and warranties, and how insurance companies have an army of mathematicians in their actuary department. Thus, paying more to get more insurance/warranty is not a foreign concept. But it also not definitive as some would like to believe. If you pay the same rate for the same coverage, then people would not shop around for insurance, would they?

[hot_water]

As it happens, there are cases where Costco does extend the manufacturer's warranty. I just had to replace my old TV and was pleasantly surprised to learn that at Costco, in addition to having the brand and model I wanted at a great price, doubles the manufacturer's warranty on TVs.

Getting back to warranty costs, of course you're right... it's not a simple issue, you do have to shop. Different designs, build quality, and parts and material quality have an effect on warranty cost. Similarly, a more efficient service organization will result in lower service costs. There are a dozen such issues that affect actual costs and thus the price of the warranty, including the overhead rate of the party offfering the warranty and the profit that they price into it.

With a spa, you're buying a product that has more to consider than just a warranty, so you really have to shop! Most would evaluate the spa based on the total value proposition it offers in comparison to other competitive spas and sellers. A lot of that is completely subjective and based on your preferences and what you think is important. Things that you value, I may not want and visa versa. Warranty hasn't been as important to me, but there are other things that I look for that may not be important to you. I do feel that if the spa developed a fatal problem (a shell issue, for example) and I was feeling like I didn't get decent value for my money, then Costco's return policy would be valuable.

Hope your repair isn't too painful to your wallet. Good luck!

[spatech (the unreal one)]

My mistake was thinking that Costco's satisfaction guarantee went above and beyond anything the manufacturers offered -- kind of like how credit card companies provide travel insurance above and beyond your existing one.

But a credit card company offering insurance will only honor claims that are deserved. I think Costco is deciding (maybe in part due to a tough economy) to take a stance when the request is unreasonable, such as a heater (a wearable part) failing 4 years after the warranty expires and the owner wanting to return the spa without making any attempt to repair it. Had your issue been a shell crack or a series of repeated failures I imagine they may have considered it differently, even if the warranty was long expired.

[PreservedSwine]

"As a consumer, I thought it was weird that the same heater (assuming that it is the heater that's defective) has a 1 yr warranty when it's installed on one product and a 5 yr warranty when it's on another."

Not weird at all. A warranty is NOT free. It's an "after sale" expense the manufacturer figures into the initial cost. Some percentage will fail within 1 year, some percentage 2 years, some percentage 3 years, etc. By lowing the warranty time, you lower the manufacturers costs, thereby lowering the initial cost of the spa to the consumer.

A warranty is NOT free! YOU the consumer PAY for it.

You want to pay less for a spa? Something has to be omitted from the manufacturers costs.

That's not Costco's model. Costco is not about "you get less if you pay less". If you want that model, go to Walmart.

The day that Costco starts doing that is the day I end my membership with them. Costco is all about "getting more while paying less". That goes for the product quality, quantity ... anything. Perhaps they goofed up when they negotiated with the spa manufacturers but I expect that Costco, with its purchasing power, can negotiate better terms for its members.

As a Costco member I would never settle for the, "You want to pay less ...? Something has to be omitted ..."

That's not accurate.

Costco sells many items that, just like that spa, are manufactured only for Costco.

Check their TV's, and google model numbers.

I recently bought a Samsung plasma tv that you can't buy at Best Buy, or anywhere for that matter, only Costco. It had many premium features, but also lacked a few features on more expensive models I could have bought elsewhere.

It was a great deal, and the savings of the features that weren't included made it an astonishing value.

I had done my research, and knew what I was buying before I bought it.

Just because it didn't have the premium features of more expensive models didn't mean I wasn't getting a deal.

It's more of a way for the manufacturer to present a quality item, without causing bitterness from other retailers in the same area. Best Buy can still claim their "low price guarantee" because Costco doesn't carry the "same" items, and vice-versa.

It's a very common sales tactic, across virtually all retailers.

About your spa- it's going to be simple to fix.

Since it's 85F, I assume the 24 hour circ pump is still working. Have you checked the heater breaker in the subpanel? It's possible the breakerhas just tripped, and needs to be re-set. If it trips again, you very well might need a heater.

But if the breaker isn't tripped, it's probably the heater circuit-board, or heater PCB, not the actual heater. They run around 140-150, plus labor to install. If you're hesitiant to call someone, it's very easy to troubleshoot if you have a volt-meter, and many here would help you if you need it.

[db3808]

About your spa- it's going to be simple to fix.

Since it's 85F, I assume the 24 hour circ pump is still working. Have you checked the heater breaker in the subpanel? It's possible the breakerhas just tripped, and needs to be re-set. If it trips again, you very well might need a heater.

But if the breaker isn't tripped, it's probably the heater circuit-board, or heater PCB, not the actual heater. They run around 140-150, plus labor to install. If you're hesitiant to call someone, it's very easy to troubleshoot if you have a volt-meter, and many here would help you if you need it.

Bingo! Heater/daughter board looked fine in front but in the back, there were burn/black marks.

[PreservedSwine]

About your spa- it's going to be simple to fix.

Since it's 85F, I assume the 24 hour circ pump is still working. Have you checked the heater breaker in the subpanel? It's possible the breakerhas just tripped, and needs to be re-set. If it trips again, you very well might need a heater.

But if the breaker isn't tripped, it's probably the heater circuit-board, or heater PCB, not the actual heater. They run around 140-150, plus labor to install. If you're hesitiant to call someone, it's very easy to troubleshoot if you have a volt-meter, and many here would help you if you need it.

Bingo! Heater/daughter board looked fine in front but in the back, there were burn/black marks.

Glad to hear it. Of all the problems to have, that's an easy one to fix. If you're doing it yourself, play close attention to the instructions, the new boards are a little different. Different jumper configuration, and different wiring schematic.