It only really needs to be on the upper managements desk:
"The $3.57 you save on capacitors per unit will cost you $50 in lost good will."
On the other hand there is a balance between longevity through simplified maintenance and replacing aged appliances with newer and significantly more efficient models.
Alternative phrasing: "the $3.57 you save (per unit) today will give you a $100.000 end of year bonus, but cost the company millions in future lost sales"
> but cost the company millions in future lost sales
Isn’t the company going to make more sales in the future (and hence more profit)? And isn’t replacing stuff with new versions going to lead to improvements in people’s lives through more efficient, quieter, and more effective technology?
It's been my experience that newer technology, though being more efficient, etc, breaks much faster than the old powerhouse tech from the 50's, 60's, and the 70's. I don't see my 1950's-something oven dying anytime soon. It will outlive me if I don't replace it for that one shiny new feature I convince myself I just have to have, or because it doesn't match my curtains.
So, yes, replacing stuff with new versions will bring more and more sales as opposed to building something that will last. Hence "planned obsolescence" and the war on making things repairable that we've seen lately. Great for business, bad for the customer.
To be fair, it's a bit more subtle than that. There's a level of survivor bias involved - all the unreliable appliances from the 50s-70s have long since been hauled off to scrap metal recycling, so what's left are the long-lived ones.
Modern electronics certainly can be made with much higher reliability than their mid-century ancestors, but the driving factor that prevents this is aggressive cost cutting that happily shaves pennies off COGS to shift the statistical distribution to the left. Unless consumers are willing to pay more for long-lived devices, this is doomed to continue.
Because the mechanism by which most contemporary appliances turn into junk is the "control board" "breaking" (which seems like it must be flash endurance, meaning directly planned obsolescence) and is unrelated to survivorship bias - old machines used mechanical timers, and even when they started using solid state it was simple. I'd say it's actually fallacious to point to survivorship bias, because old machines were built with parts that could either be repaired or replaced.
I've got a relative's dryer right now that's acting up. Do I really want to do the work of calling around to a bunch of repair guys to find out which one won't charge me a fee to come out and say "it's going to cost more to fix than to buy a new one, and we can have the new one installed and delivered tomorrow" ? I've heard this trash spiel so many times at this point I don't even care to try engaging, despite not even having to pay for it myself.
No, I'll spend the 20 minutes taking a few screws off and looking at the thing. Then order parts. Then next week, an hour or two to replace the part. Then it will likely be sorted for the next decade, but if it does break again it will continue to be repairable rather than effectively a consumable.
> Isn’t the company going to make more sales in the future
Only if you don't overdo it. When your products break too quickly many customers will stay one-time customers and switch to products from the competition. There's also the reputation damage to consider.
And of course it works best if you have a fairly high market share. If you have a low market share most products on the market are from your competitors, so you can you are better off boosting your reputation with longer-lasting products (compared to other products at the same price point).
Come to think of it, the "break it faster to sell more" strategy works mostly in monopolies, duopolies or with market collusion (like the Phoebus cartel that lowered the lifespan of light bulbs)
Or in other words, the $3.57 in savings will allow the product to compete in a lower price segment and increase sales significantly.
It is the behavior of the buyers that drives costs down. People are extremely cost sensitive in the mid to low segments, shifting their purchase decisions from one product to another just because of less than $1 price difference. Some companies cannot survive at all without saving those $3.57.
Buyers do not exist in a vacuum, and consumer behavior is commonly manufactured. Consumer behavior has never been a substantial justification for optimizing for wasteful and environmentally business practices in pursuit of quarterly growth.
> replacing aged appliances with newer and significantly more efficient models
Are we still expecting to make significant efficiency improvements for appliances in the next 30 years? Will it be enough to justify the production of a new appliance?
Legal warranty for appliances like washers, dryers, refrigerators among others should probably be raised to at least 5 years.
The thing that gets me about modern warranties on appliances is how weasely they'll market their warranties. I've got GE clothes washer and dryer proudly proclaiming their 10 year warranty. It's a 10 year warranty on the motor and the drum (IIRC). Not on the motor inverter unit, which had a one-year warranty. Guess which part is likely to fail? Guess what that GE service tech is going to recommend you do after he prices out several hundred dollars of parts he thinks he might need because he's too lazy to actually diagnose the issue?
An LG dishwasher with a similar 10 year warranty on the pumps and what not in the dishwasher. Awesome, great. The display panel has failing LEDs. Is that under that warranty? Nope. Who cares about the pump not technically failing if one can't know what mode the dishwasher is in?
If they're going to stick a sticker on the face advertising their warranty on an appliance it should cover the whole appliance. Not just a small handful of parts that should practically never fail under regular use while all the surrounding stuff has a nearly useless warranty.
I'm so salty about warranties and support these days I usually try and do every possible thing I can do to fix the problem myself before obviously voiding a warranty before I ever bother calling their support. So worthless most of the time.
Sadly, there's has no system for long term reviews. In my dreams, Amazon/etc would engage customers about their durable products and ask how often you still use the product and it/when you're thinking of replacing it...
Given the economics, I wonder if best buy could pay customers $10 for a survey of their old products, knowing that it'll inspire upgrades etc.
I would not spend 10 seconds of my time writing a product review or answering a survey like that. If Amazon is interested in selling good products they can hire product testers who will do teardowns, destructive testing, and running them through a 5-year simulated use durability test.
Amazon is now, largely, just Aliexpress with faster shipping and easier returns (and higher prices).
Even in areas where they have brand name products, it's often impossible to surface them through their search. (I've, many times, failed to find something there and then went and searched Google/etc and the top result has been... an Amazon link to exactly what I'm looking for.) And if you purchase through Amazon, there's no reason to believe it's not gray market or something else where you may end up having issues with support/warranty if you ever need.
And combined with the inventory commingling, even if you find brand name products there you can't be sure you'll actually receive it and not a knock-off. So it really only makes sense to order things that are already the cheap/knock-off quality anyway.
So... yeah, there was a nice period of time there where Amazon was just "shopping made more convenient". These days it's "Aliexpress made more convenient". Unless I'm setting out to buy cheaply made Chinese imports with no warranty, I'm not even go to start looking on Amazon. There's little reason to.
> "The $3.57 you save on capacitors per unit will cost you $50 in lost good will."
Or it might cost you $0 in lost good will, and will gain you $5 in sales because many price-sensitive people will buy the thing that's cheapest, without doing an omniscient analysis of its quality.
Not to mention that gold-plating your capacitors won't do you much good if some other part is expected to fail first.
>if you cut corners, you may be rich, but then I'll think you're a bad boy!
Uh oh, a moral judgement from a peasant? Say it aint so. Anything but that. I'm literally shaking right now.
Anyway, here are some actual incentives:
- If you do some shady corner-cutting, you'll be legally compelled to trade in your Bugatti and drive a used Kia the rest of your life
- If this chemical causes bodily harm to me, we shall inflict bodily harm on thee
- A portion of the profits will be placed in a trust and will be passed down to your children, if and only if your product lasts long enough to be passed down to our children
- If you (banker) lose our money, you will lose your head
These rules discourage new businesses from starting and you end up in a situation like France where their largest company is some fashion company formed eons ago (probably before all the regulations).
France is an extremely wealthy country with possibly the best quality of life in the world - many would say better than in the English-speaking countries home to most of HN.
"The $3.57 you save on capacitors per unit will cost you $50 in lost good will."
On the other hand there is a balance between longevity through simplified maintenance and replacing aged appliances with newer and significantly more efficient models.