I was talking to Nick about what I’ll call The Ikea Problem: cheaper, poorly made products appear to be more cost-effective than more expensive ones. If an expensive product will last many times longer, it’s usually cheaper over time.
Ikea furniture is a perfect example: a $250 table will often break after 2-5 years, where a nice $700 table might last for 20 years or more.
I had a thought — that if warranties were standardized and it was very easy to obtain a replacement for products, we could compare cheap vs quality products more easily. Proper warranty reform, in this case, would mean replacement through an easy web form or quick phone call, or even a centralized organization that takes care of replacement. It would probably mean a centralized database of every product and its warranty, as well as an easy way to provide and transfer proof of purchase. It would be a process of government regulation, but perhaps it can be done nimbly and flexibly, with environmental and cost savings outweighing the pains of bureaucracy.
Right now, warranties are painful to execute. They can require proof of purchase, UPC codes, detailed descriptions, long wait times, and any other hoops a manufacturer can dream up. Common modes of failure are often exempted from replacement.
Imagine a world in which manufacturers had to compete on the longevity of their products and were held to these claims. Would they use more similar parts across product lines? Would products begin to last longer?
Pairing a standardized, apples-to-apples comparison of “cost over time” with a financing solution such as Affirm could allow people without the necessary capital to buy these greater-longevity products.
What do you think? How could we make this happen? Would this work? What are the potential downsides?