Australian hardware resellers are lashing out at warranty provider United Warranties as concerns over the company’s future mount.
The warranty provider has in recent weeks lost several large accounts including department stores Myer and Big W due in part to confusion surrounding the company’s financial situation.
Reseller partners report United has gone to ground in the last two weeks, with attempts to contact the warranty provider met with silence. Multiple efforts by CRN to contact the company have also failed.
With widespread industry speculation the company is on the brink of collapse, partners are growing increasingly concerned over unpaid debt owed to them by the warranty provider.
Mobile computer reseller Portacom is one of many aggrieved United Warranties partners. The company held a long-term relationship with the warranty provider for extended warranties and repairs until a year ago.
General manager Andrew Van Leen told CRN Portacom ended the partnership because United Warranties had become too difficult to deal with.
The warranty provider still owes Portacom $7000, a sum Van Leen had been chasing until UW stopped returning his calls last week.
“I’ve made multiple calls to their generally listed numbers, direct calls to sales reps, we’ve left multiple messages, and we’ve gotten no answers at all,” he said.
Van Leen did have one phone call answered, from Teyghan Stadelbauer, who is listed as the company’s national sales director. Stadelbauer told Van Leen “everything is fine and the company is still going strong”.
“But in the second half of the conversation, she said she didn’t work there anymore, didn’t know what was going on and couldn’t help us,” Van Leen said.
Stadelbauer’s mobile voicemail and LinkedIn profile identifies her as an employee of United Warranties. She did not respond to multiple attempts at contact by CRN.
Victoria-based PC reseller Standard Computers Australia will be out of pocket around $10,000 should United Warranties go under.
Store manager Chris Sambell has been attempting to recoup his losses from the company but said situations such as this are part and parcel of the business.
“Unfortunately it’s not unusual for warranty companies to go out of business,” he said. “The fact that we can’t get hold of them tells us they’re going into administration.”
Sambell estimates his company has 30 - 40 new warranty orders waiting to be filled, and 150 out in the marketplace, with lifespans of up to five years.
In addtion to being concerned about the debt owed to him, Sambell expressed apprehension about the massive flow-on effect United Warranties’ expected liquidation would have on the industry.
“The ideal thing about these guys was they weren’t as expensive as a manufacturer's warranty,” he said. “We’ll probably have to convince customers to go down that route and pay more for a manufacturers' warranty.”
“We’ll honour the repair and the cost to get the device back to the customer, but it’s hard enough in the industry as it is to then have to explain to the customer they have to fork out money to get their faulty product back to us.”
It’s not just bricks and mortar resellers affected by the fallout. Online PC retailer Tech4U was heavily embedded with United Warranties until recently, when the company began to suspect something wasn’t right and stopped ordering its products.
“We spend a fair bit of money with them,” sales supervisor Fred Porter told CRN. “They even came out and visited us recently and said not to worry should they go under, because they are constantly sitting on a pile of millions should something happen.”
That was six months ago. United Warranties has been less enthusiastic about reassuring its partner in recent weeks.
“Usually we go through a dedicated account manager, and they’ve stopped replying,” Porter said. “We got a reply from head office two weeks ago that redirected us through to no-one, the regional manager’s mobile has been off for two weeks and we’ve sent emails everywhere and haven’t heard back."
Tech4U has stopped recommending the company to its customers and has taken references to United Warranties and its products off its website.
United Warranties’ ABN is still listed as active, and has a ‘registered’ status with the Australian Securities and Investments Commission. ASIC did not respond to request for information by the time of publication.
United Warranties commenced local trading in 1996 and later established a presence in New Zealand.
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Issue: 324 | February 2014
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