Investing in an extended service contract on new equipment purchases is a great way to keep those machines running just like the day you bought them, lower your out-of-pocket maintenance and repair expenses during terms of the contract and help preserve residual value. However, not all extended service contracts are the same so it’s important for you to review the details before you sign an agreement.
Here’s a few tips to consider when looking at an extended service contract.
Is an extended service contract different than an extended warranty?
It’s common to hear people refer to extended service contracts as an extended warranty, but there is a difference. An extended service contract is not a warranty because you pay extra for it, and it may not include all the same coverage as the original warranty.
Who is providing the coverage?
Signing up for an extended service contract from the dealership where you purchased your equipment is always a great option. Most of the time, the dealer will be able to offer you a package that is facilitated by the original equipment manufacturer (OEM), and no one has more knowledge about a machine than the company that built it.
“When we developed the Vermeer Confidence Plus® asset protection program, our extended service contract, we focused our efforts on the needs of our customers,” explained Deb Whitten, corporate warranty manager at Vermeer. “We wanted to ensure we gave them the best overall coverage, as well as options to extend coverage to routine maintenance and flexibility. No one knows our customers’ needs better than we do.”
What’s covered?
Many extended service contracts only cover parts. Others cover parts and labor but not travel time for the service rep. Because of these variables, ask your dealer questions to make sure you understand what you’re getting in an extended service contract. You don’t want to pay for coverage you will not use, but you also don’t want to find yourself having to pay extra for services you thought were covered in your service contract.
Whitten said the best value for many contractors is an extended service contract that goes beyond covering only parts and labor. “With the Vermeer Confidence Plus program, contractors can select between base coverage or premium coverage,” she said. Base coverage is available on all new Vermeer equipment. Contractors can select 2,000 hours/2 years or 3,000 hours/3 years of coverage measured from the original warranty start date. There is a 1,000 hours/1 year of parts and labor coverage at no charge.
“Vermeer Confidence Plus program premium includes coverage for routine maintenance and comprehensive inspections at regular intervals for the first 1,000 hours,” said Whitten. Travel and diagnostic time are covered for the entire program term. There are also several additional options for extending maintenance coverage because we know how important it is for contractors to have their machines serviced by a certified Vermeer technician.”
Who’s doing the work?
Many extended service contractors will require maintenance work to be performed by the dealership where you purchased the coverage. The drawback to this type of arrangement is that it doesn’t factor in those times when you’re not working within the dealership’s territory, putting you in a situation where you either need to transport the machine back to the area, or pay for someone else to perform the scheduled maintenance.
“We are the administrators of the Vermeer Confidence Plus program,” explained Whitten. “Scheduled maintenance or repairs can be performed by any Vermeer dealer without any extra expenses, which is important for contractors who travel frequently.”
How to pay for it
The easiest way to pay for an extended service contract is by making it part of your financing package when you buy or lease a new machine. However, if you find yourself in a position where you aren’t sure if you need it, you decline the coverage and then change your mind, you can add Vermeer Confidence Plus program coverage to any Vermeer machine that is still within the terms of its original warranty.
What about used equipment?
Vermeer also offers pre-owned Vermeer Confidence Plus program options on some used equipment. To qualify, the machine needs to pass an inspection performed by a Vermeer dealer, and then you just need to choose your package. It works the same way as it does on new equipment — complete parts and service coverage for an agreed-upon length of time or machine hours, whichever one comes first.
Trade-in advantages
In addition to helping increase productivity, residual value retention is one of the major advantages of purchasing an extended service contract. Dealers will likely offer you better trade-in value on a machine they know has been well-cared for.
If you decide to trade in or sell a Vermeer machine with Vermeer Confidence Plus asset protection program, the remaining balance of coverage also transfers to the new owner.
Quality equipment, quality coverage
If you’re looking for maximum productivity and peace of mind, buy quality equipment and invest in an extended service contract. Learn more about the Vermeer Confidence Plus asset protection program here or by talking with your local dealer.
Vermeer, the Vermeer logo and Vermeer Confidence Plus are trademarks of Vermeer Manufacturing Company in the U.S. and/or other countries.