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The Cat Fight over DoA

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Sandhya
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Warranty issues related to Dead on Arrival (DoA) products have long been a serious bone of contention between vendors and channels. Although each vendor has set its own DoA policy, depending on the

products. However, the lack of clarity of this policy

among channel partners is something which is creating

differences between the two. In general DoA products

are defined as products that fail to function substantially

in accordance with published specifications due to

defects in manufacturing or materials during the first

year from the date of purchase. Buyer must report this

situation to the seller within 48 hours after delivery of

the product.

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VENDORSÂ’ DoA POLICY

Almost all principal companies do have a DoA policy

in the system, but it varies from case to case. As per

IntelÂ’s DoA policy, a product is considered DoA if the

failure happens within 30 days of sale. Customer has

to visit the distributor with the invoice copy and the

product. Distributor validates the invoice and checks

for the damage. The product will be replaced if the

invoice is valid and meets the terms and conditions of

the product warranty. R Ravichandran, director, sales,

Intel South Asia pointed out, “There are many factors

that drive DoA, for example how things are handled

during shipment/transportation, sometimes simple

software, and driver issues etc can cause DoA.”

Vishal Mhalsekar, country service manager, Asus

(India) mentioned, “Under our DoA policy, software

failure is handled by service center on immediate

repair basis. Any failure due to virus issues also comes

under normal cases and is repaired. However, physical

damage, customer induced damage and liquid flash

is not covered under our DoA policy.” Asus claims

its motherboards are the only motherboards that

are covered for 100% burnt and corrosion warranty

throughout the warranty span of the product which

is 3 years for most motherboards and 5 years for TUF

series motherboards.

Sunil Grewal, sales head, Gigabyte Technology India

defined, “Our DoA policy involves 3 stages. Firstly, any

product that does not power up properly, function

properly and has non-informed bug/defect; secondly

all products failed during installation at end customer

or within 120 days of date of manufacture; and thirdly,

within 45 days of date of shipment from distributor,

or products failed during installation at end-customers

within 7 days of date of invoice.”

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Nikit Rambhia, director, Panache Infotech said, “As

per our company, if the product as a whole or any of its

components fail to function during 15 days period after

the shipment, we treat it as DoA. If DoA warranty claim

comes to us we replace the entire unit not a particular

component. There arenÂ’t any stringent terms, it is just

that if claim has been made after 15 days then it falls

under regular RMA.”

DoA FACTORS

DoA can imply different things to different people.

From the manufacturer perspective, if a product does

not perform as per stated specifications when the

product is freshly taken out of the box then it is DoA.

However, for a customer if the product does not work

in his environment then it is DoA. As evident the issues

related to compatibility, environmental conditions,

damage during transit etc, are bit of gray areas which

either side may try to play to their advantage.

Ravichandran highlights, “DoA can happen due to

various reasons like customer handling, integration

errors, compatibility issues or real product issues.

Actually DoA covers only the product failure and the

handling or integration or compatibility issues. So, Intel

tries best to investigate the real reasons behind DoA

on a case to case basis.” In the words of Atul Khosla,

director, Om Nanotech, “DoA could hap pen because of

faulty manufacturing process but it can also happen

due to poor transit condi tions like vibrations or shocks

during transit, high humidity or water seepage or even

electro static discharge.”

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It could also happen that the equipment used by

the customer may not be of standard. So depending

upon the manufacturerÂ’s percep tion, the manufacturer

may form a tight DoA policy to insulate himself from

such conditions. Due to such fine print the customer

may feel frustrated. Rambhia of Panache Infotech says,

“The prime reason of delay in DoA cases is logistics

and transportation fail ures/delays. Non-free movement

of goods between states and jurisdi ctions tend to

defeat us on our turnaround time promise. Though we

are highly efficient in this area too, but still if IndiaÂ’s

logistics infrastructure had been better or even if document

processing for interstate goods transfer been

quicker we could have promised a replace ment within

24 hours.”

Agreeing with him, Sanjoy Bhattacharya, product

group head, IT products, LG India says, “The lack of

standardization of warehouse and poor handling of

the products by porter are some of the other gray

areas which amount to DoA cases. Although we have

introduced special packaging to avoid such cases, but

still once the product moves to the distributor ends,

we have no control to monitor such negligence.”

The main cause behind DoA cases is logistics as it

is managed by a third-party and during transportation

products get damaged and so are reported as a DoA

case. Emerson has several checklists before the product

reaches to the end customer such as products are

packaged as per global standards, for transport and

rough handling taking their weight and dimensions into

consideration. From manufacturing facilities in India

and abroad, the hard ware passes through warehouses,

distributors, sub-distri butors, partners, and local offices

before finally reaching the custo mer. “We take complete

responsibility of the hardware till it is delivered to

the distributor from the warehouse, after which the

distributor manages the logistics. If some part of the

consignment gets damaged during transportation to

the distributor, it is reported and the logistics provider

has to pay a penalty,” said Ankesh Kumar, director,

channel products and marketing, Emerson India.

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BEST PRACTICES

Vendors follow various best practices to mini mize DoA

cases. “Low margins in the industry are hitting DoA

policies for many companies. This is why we ensure

everyone associated with us earns good margin so that

he can support his down channel till end customer. We

feel the most important factor is to make sure that the

customers, resellers, distributors, freight forwarders

and our own service centers follow our guidelines on

how to handle our products and also follow our return

merchandise authorization procedure and policy,” said

Ajay Kogta, country manager, Indian Subcontinent,

Strontium Technology.

For Strontium, DRAM modules DoA cases are

negligible since the company uses only major brands

chips to produce modules; the company claims it has

hardly got any such cases in the last 6 months. Yes,

in flash products some cases came up, but again the

ratio was very nominal, less than 0.0005% of the total

products sold in any year. “We take these cases with

utmost priority and provide over-the-counter immediate

replacement at all our service locations which are

spread across India at 52 locations,” said Kogta.

Gigabyte claims it offers on the table replacement.

“If buffer is not available, we are committed to offer

replacement within 3 days in metro cities, and within 7

days in non-metros/upcountry markets,” said Grewal.

“

Tech-Com has facilitated complete box-replacement

at the point-of-purchase itself within 48 hours

so as to save the customer the harassment of visiting

different places to get their work done. Also, it saves on

time economy as there is no incessant waiting for the

customer to get their phone operational.” explained

Shridhar Bagade, head, product support, mobile phone

division, Tech-Com.

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CHANNEL COMPLAINTS

Though most of the vendors claim their DoA cases are miniscule in numbers and have satisfactory mechanism

to settle DoA cases, partners have a different story to

share. According to resellers, the issue of DoA is not so

much about getting the replacement as it is about the

time taken and the indifferent attitude of distributors

and vendors.

Most of the partners are discontent with the

vendorsÂ’ biased attitude towards small city resellers.

“In large cities, replacement takes 10 days, while in

most cases we have a turna round of 30 or more days.

Also, there are no local vendor representatives that

we can escalate the problem to and are always at the

mercy of dealers who are least interested in resolving

the issues,” said Kishore Makhija, CEO of Raipur-based

Priyanka Computers.

“There is an inordinate delay in getting replacement.

Most vendors have a replacement policy of 30 days, but

that commitment is never met. Often the distributors

refuse to accept DoA cases asking us to speak to

vendors. While, vendors say that the distributors have

been provided with replacement stocks and we should

deal with them,” explains Jitin Gupta, owner, Usha

Infotech.

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Agreeing on the same, a Kerala based-partner said,

“The problem is really very acute with component

vendors who have a practice of back-checking the

incidence of damage. Once the product is reported as

DoA by the reseller, the vendor will check whether it

happened at the customer end or resellerÂ’s or dealerÂ’s.

This process alone takes several weeks and often, once

the DoA is verified, we are told that the product is out

of stock.”

Gupta asserted, “By the time the replace ment arrives

the product pricing has changed or a newer model has

been launched and this adversely affects our margins. While a lot of vendors provide price protection of 30

days, replacement usually takes longer. Our committee

will also highlight such anomalies in vendor policy.”

Mhalsekar of Asus said, “We are aware of this

problem and to counter the same, we offer free pick

and drop service in 768 locations in the country which

comprise chiefly of C, D and E class cities. This ensures

faster turnaround time as well as convenience for our

customers. In remote locations, sometimes the same

product is not available on an immediate basis, but

we either arrange the products on immediate basis or

offer an alternative to the customer.”

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He further added, “Mainly, the disagreements are due

to improper understanding of the DoA policy. At Asus,

we do our best to educate our partners and customers

about our DoA policy so that such a situation doesnÂ’t

arise.” Khosla of Om Nanotech asserted, “Yes, in some

cases the warranty policies have too many ifs and buts

and pre-conditions or compliance to be made before

the DoA warranty is honored. We have total confidence

in our products and hence, we offer no strings attached

to amazing warranty.”

Eric Yang, country manager, Edimax Technology

India suggests, “DoA policy needs to be defined

properly and educating partners is required which

most of the companies do not adopt or their team is

unable to convey in the market. Companies should

have a channel-friendly DoA policy so that partners are

able to manage effectively.”

Kumar of Emerson says, “Yes, the problem in

smaller cities is higher for DoA. This is due to the fact

that by the time the product reaches the small city it

might have gone through 3 or 4 shipments and enough

care may not have been taken to keep the product

safe during transit. To counter this problem we use

better quality packaging which is tamper proof and is

robust to withstand expected mishandling. With such

measures we are able to safeguard our products to a

large extent from DoA.”

“In India there are still no established regulations

in areas such as logistics or taxes, so as a vendor we

have to take the fall at times. Though processes are in

place at our end, we have to take some quick decisions

on the ground. At times it costs us additional taxes or

transport costs because the customer doesnÂ’t want to

wait, but we have to consider these extreme cases to

provide good service. However, as the number of DoA

cases is very less it doesn’t affect us in the long run,”

says Bhattacharya of LG India.

PARTNERSÂ’ EDUCATION MUST

Kumar explains, “We have seen DoA cases happens

due to the lack of understanding of partners. At times

a partner might over commit on a particular product to

close a sale, though that machine would be suited only

for a particular kind of application.” For example if a

machine that is fit for IT networking applications is put

under industrial load, it will not work. The customer

obviously claims it is a DoA case. “It becomes a very

difficult situation for us because we understand that

even if the unit is replaced it wonÂ’t work. Partners and

also vendors must ensure that these details are not

overlooked. Every product is meant for something and

works best in that application,” he added.

In the conclusion it is obvious that any vendor does

not take its DoA policy lightly, because a customer

with a bad experience will never come back with a new

order.

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