Abstract: In recent decades, high profits of extended warranty have caused that third-party firms consider it as a lucrative after-sales service. However, customers division in terms of risk aversion and effect of offering extended warranty on manufacturers’ basic warranty should be investigated through adjusting such services. Since risk-averse customers welcome extended warranty, while the cu...

Nowadays, offering extended warranty is considered as a lucrative source of income from the perspective of the after-sale service providers. Meanwhile, the main concern is presence or absence of base warranty and strategies adopted by the manufacturer during this period. Moreover, extended warranty structure must be responsive and customer oriented, which not only control the services cost but ...

This paper addresses the problem related to the adoption of an extended warranty period for randomly failing products sold under warranty. The possibility of buying an extended warranty for a given additional cost is often offered to the buyer by the manufacturer. The buyer has then to decide to take the extended warranty or not when purchasing the product. We develop in this paper a mathematic...

For repairable items under the two-dimensional warranty, the manufacturer expenses warranty costs for rectifying the failures occurring over the warranty coverage. Preventive maintenance actions reduce the occurrence intensity of item failures, and hence the warranty cost resulted from corrective maintenance, but bring additional preventive maintenance cost. In this paper, we investigate a peri...

This paper analyses life cycle cost for equipment protected by both base and extended warranty policies from a consumer’s perspective. We assume that the equipment have two types of failures: minor and catastrophic. A minor failure can be corrected by a minimal repair whereas a catastrophic failure can only be removed by a replacement. The equipment is assumed to be maintained at no charge to t...

Along with increasing the warranty period for complex systems, reducing the warranty servicing costs has become an issue of great importance to the manufacturers. One possible way to reduce the expected warranty servicing cost is by making sound decision on the product warranty and maintenance strategies. Therefore, warranties (basic warranty and extended warranty) and maintenance (corrective a...

In today's fiercely competitive products market, product warranty has started playing an important role. The warranty period offered by the manufacturer/dealer has been progressively increasing since the beginning of the 20th Century. Currently, a large number of products are being sold with long-term warranty policies in the form of extended warranty, warranty for used products, service contra...