Article contributed by Mike Berman, COO, Day & Nite/All Service, with Tia Tassava
When a former client from an entirely different industry insisted I call back at my first available moment, I feared the worst. Triple headed monsters of public health, economic and social justice crises have a way of courting dread for even semi-urgent matters. But when this manufacturing executive wanted to talk about the Magnuson-Moss Warranty Act, to say the least, I was relieved and puzzled. How could a piece of 1970’s consumer protection legislation be of any interest in this environment?
Turns out, quite a lot. This former client had read our two most recent Total Food Service columns regarding essential planning and budgeting and had already put the advice into practice. His company’s supply and demand chain analysis and planning revealed great interest in warranty coverage and associated overall business costs. Given significantly decreased demand for his company’s manufactured product, imposing more restrictions on already tight warranty coverage amounted to nothing short of necessary emergency economics.
Undoubtedly, this is not the only manufacturer in any industry finding no alternative but to make it harder for customers to qualify for and exercise a warranty. In part, his financial predicament was exacerbated by his very own suppliers clamping down on warranty coverage for the machinery he relies on to manufacture products. The catalyst for all this — global in nature — is not limited to any industry but includes all where manufactured items, warranty coverage, and aftermarket parts are involved. Clearly, all highly relevant for hospitality.
Presumably, very few readers have paid any attention to the Magnuson-Moss Act, and less than a majority are overly familiar with it. But this one illustration on an apparently arcane matter dramatizes just how important thorough, inclusive business reviews are for planning and budgeting purposes. Gaining as much information on what the current hospitality warranty landscape looks like and insights for the months and year(s) ahead critically important, especially if industry manufacturers also face severe financial pressures leaving them no (better) option but to restrict coverage. In this regard, restrictive coverage doesn’t necessarily mean changing warranty rules in midstream—doing this would likely violate Magnuson-Moss. But it does mean rejecting more warranty claims on technicalities. Think of it like state troopers issuing tickets for traveling 56 MPH in a 55 MPH zone.
Becoming better acquainted with specific warranty terms can also lead to greater benefits than just protecting against restrictions. Although February may seem like decades ago, Total Food Service did an in-depth piece about parts harmonization featuring, among other things, the viability of non-OEM parts by both performance and price measures. Shifting to high-quality non-OEM parts from a highly regarded source can potentially shave substantial costs from anyone’s 2021 budget. There’s a wide gap between qualified non-OEM sources and those selling grossly inferior products not worth the risk. Leading maintenance and repair companies are most trustworthy for determining your business’s non-OEM feasibility and for identifying competent distributors.
Dynamic business planning and budgeting are always recommended, but volatile climates dictate this is done as a routine, going far beyond the core material. Business planning must be treated as an ongoing process, placing a particular emphasis on continuous learning and improvement. Already deep into delivering business reviews, based on this unexpected call from a former client in an entirely different industry, the Day & Nite family of companies now includes elements of and implications from the Magnuson-Moss Act. Suppliers committed to learning are always best equipped to help their customers continuously improve. If you’re not getting that from all your suppliers, you’re taking on way more risk than even the already complicated conditions that have dumped on hospitality.
With NYC restaurants now joining the suburbs, CT, NJ, and the rest of the country permitting indoor dining, the James Beard Foundation hosts a not to be missed webinar on best practice hygiene and safety protocols 2 PM EDT Tuesday, September 15th. Register here.