Early last year, Vizio's 32-inch LCD TV was selling for around $1,400 at Costco. Right now, that same TV--well, actually, a
better version of that model--is priced at $899. To anyone who's been keeping tabs on the flat-panel TV market, this sort of price erosion isn't exactly a great shock. But if you happen to have bought said TV, you're probably experiencing a touch of buyer's remorse. The fact is, today your $1,400 would easily buy you a
37-inch LCD TV. And by the end of this year, that kind of dough might get you within striking distance of a 42-inch LCD.
Some stores offer a bit of price protection--usually about 30 days--but Costco is bold enough to tell customers they can return a product at any point during the course of its lifetime (except for computers, which are capped at six months). Depending on which Costco manager you run into, there appear to be some restrictions to this policy, but so long as your set is relatively blemish-free (read: no baseballs thrown through the middle of the screen), chances are that if you brought back last year's model in its original box, you'd get your money back. Bring back a 2004 model, and odds are you'd also get a full refund. A receipt helps speed the return process, but it's not essential, because Costco--a membership-based discount "club" ($50 a year gets you in)--does an excellent job of tracking your purchases via its computer system.
Have you ever returned an old but perfectly good product at Costco?
Naturally, Costco would prefer if you didn't return what you bought, and in a non-nefarious world, its generous return policy would apply to products that were truly defective or just didn't meet a customer's expectations--plenty of people return HDTVs simply because they couldn't set them up properly or didn't realize you often need more than just an HDTV to get HD programming. But in offering what essentially amounts to a free extended warranty, Costco is selling big peace of mind--not to mention thousands of TVs--while becoming a serious threat to the Best Buys and Circuit Citys of the world.
Yeah, a few years ago, when no-name TVs delivered subpar performance, some of us scoffed at the notion of making an HDTV purchase at a discount club. But now, with Vizio putting out a pretty decent 50-inch plasma for $2,000, the question is, why wouldn't you buy your next TV--and other electronics, for that matter--at Costco or at Sam's Club, which has a similar return policy?
One of the issues is selection. Costco.com carries plenty of TVs from name-brand manufacturers, including highly rated sets from Panasonic and Pioneer--and yes, the company's return policy applies to items purchased on its Web site as well. But many of the real deals--such as the Vizio 50-inch plasma--are cash-and-carry, in-store purchases, with no shipping option available. And if you don't have a pick-up truck or a full-size SUV, getting a larger TV home can be a challenging proposition. Packing it up and returning it also isn't much fun, but when you start seeing price swings of $500 to $1,000 in a year, temptation rises.
If you're wondering how Costco stays in business with such an open-ended return policy, that's a good question. Costco doesn't share the details of its contracts with manufacturers, but it's a good bet that manufacturers share the costs--or even take the brunt of the hit--when you return a product. I asked Vizio reps whether the company takes back defective and nondefective TVs--the answer was yes to both. Without getting into a discussion over whether it has to take back sets, they added that, to help prevent unnecessary returns, the company offers free onsite service on TVs larger than 30 inches--in-home or at your business--for any problems that might arise within the first year of ownership. (Smaller sets are covered for a year as well but must be shipped to a repair facility.)
The big question is whether it's ethical to return a perfectly good TV after more than a year. As I said, while Costco may have a very lenient return policy, it appears from reading various message-board posts that not every Costco manager is inclined to accept nondefective products, especially as more customers start carting in 2004 models and upgrading to bigger sets. Many argue that they're perfectly within their rights as a consumer to make such a return. But others know that if enough people trade in their 42-inch plasmas for 50-inchers, the same thing will happen with TVs that took place a few years back with computers: manufacturers complained bitterly until Costco finally changed its return policy for PCs. In other words, abuse it, and you'll lose it.
Where do I stand on all this? Well, honestly, I'd be embarrassed to return a set that was in good working order after more than a year, but anything within those first 12 months is probably fair game. I have to say that, if I had the car for it, swapping a 32-incher for a 37--or a 42 for a 50--would be hard to resist. What do you think?
Have you ever returned an old but perfectly good product at Costco? What's ethical and what isn't?
$399 Bundle eCode: USPCNETS10MOUSE
Post your comment here
