Money Saving Monday Tip #21: Buy Refurbished Products
Photo by: nateOne
This article is part of an ongoing series where I write about Money Saving tips and strategies each Monday. You can see the rest of the series articles here.
I’m always on the lookout to save money, but I also understand that you often get what you pay for. Two years ago when I was shopping around for my first Blackberry I ran across a refurbished one that was literally $300.00 less than a new one. This to me was a huge sign to me that there must be something really wrong with it. Thus I did what I always do, I headed over to Google to get the real scoop. Turns out, refurbished products can be great deals. I called the Cingular sales department, and found out that refurbished Blackberries look no different than the new ones, and that the only difference is the warranty, which was 90 days instead of a year.
A few days later my refurbished Blackberry arrived in the mail. Cingular was right, had I not known it was refurbished, I would have thought it was new. It looked brand new, no scratches, no signs of use, everything worked, and it had the full packaging and instructions. I always snickered every time I spoke to someone with the same Blackberry, knowing that they most likely paid $300.00 more for theirs.
That Blackberry lasted me until mid this year, when due to dropping it I broke the thumb wheel, which would cost more to repair than the cost of a new Blackberry. What did I purchase? Another refurbished Blackberry of course. Once again, I saved almost $300.00 and like the previous one, it arrived in like new condition.
What are refurbished products and where do they come from?
Refurbished products are products that for one reason or another were returned to the manufacturer, fixed, and made available to sellers at a significantly reduced price. Here are just some of the reasons products are refurbished:
Most every product is tested prior to leaving the factory, this is particularly true of electronics. Products that fail testing are candidates for refurbishing as the defect is generally the result of just portion of the product. The manufacturer fixes the component and makes the product available to resellers as refurbished. Another twist on this is that a manufacturer may release a product and due to a design or production problem, the product has a low customer satisfaction level and/or a high number of returns. The manufacturer may recall the product, fix the defect and resell the corrected product as refurbished.
Retail stores receive a large number of returns. These returned products are sent back to the manufacturer who then credits the reseller. In some cases the there is nothing wrong with the product, other than it was opened. In other cases the product is defective in someway. In either case, the product is fixed, repackaged and made available as a refurbished product.
While generally stores reduce the price of overstocked products, they will sometimes return the overstock to the manufacturer. With electronics, when a newer model starts being sold, manufacturers will frequently return the remaining stock of the older version to the manufacturer. These older models are frequently sold to overstock resellers and as refurbished products.
Where can I find refurbished products?
Most online retailers and service providers sell refurbished products in addition to new products. This includes computer manufacturers, cell phone providers, and Amazon.com. Other online sites specialize in carrying overstocked and refurbished products. My two favorites are Overstocked.com and Woot.com.
Things to watch out for
As with anything, there are a few things you need to watch out for though:
Make sure it has a warranty and/or return policy
Most credible refurbished products come with a warranty. The warranty is generally far less than the new product warranty, but is usually at least 30 days sometimes more. Also, make sure the retailer you are purchasing from has a reasonable return policy for the product. That way when you receive it and aren’t satisfied you can return it for a full refund. Also important is to make sure the product has a warranty for the country where you live. Personally I won’t purchase refurbished products that don’t offer both a warranty and return policy.
Is an extended warranty available?
While I don’t recommend purchasing extended warranties, the manufacturing having one available for the refurbished product makes me feel more comfortable about the quality of the product.
Do you buy refurbished products? Had any major successes or failures? How about some tips on where to find them? Add a comment!