On 29/07/2018 09:00, The Natural Philosopher wrote:
Actually I think it ties in to a whole mentality which is somnewhat like the TV rental market used to be. I want a product, but not te reposnibility of ownerhsip.

So cars are contract hired.With AA style support.

Appliances are bought on credit with aÂ* guarantee. If they break then they are fixed FIC.

Household maintenace is on fixed annual price call out.

It's all about people who can understand monthly outgoings, but not how to budget.

Further up the income scale, they simply buy new on fault.

Agreed. These extended warranties are in my view always a con. But enough people get taken in that they account for a significant amount of profit for the manufacturer and, of course, the insurance companies involved.

It's also an explanation for the difficulties of the Brexit negotiations, where there's an attempt to separate trade in goods and services. Both are broadly speaking covered while we are a member of the EU, but if we leave - who knows? The problem is that lot of the value of the supply of goods comes from a service element. And not just in consumer purchases: if a business buys a software package it will probably also buy a software update service, and at the highest levels, if you buy a frigate or an airliner you expect that a servicing contract will be included in the deal.


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Clive Page