It used to be that you could just walk into an electronics store to check out some high tech gadgets, buy whatever you wanted and just leave unmolested. That isn’t how it goes anymore. Giz Arena reports that these days, there are minefield of offers and special service plans for customers. If you took all the offers you got, you would probably walk out having paid twice as much for your TV or anything else as you would if you just bought the thing by itself. It kind of reminds people of the hard-sell that they encounter at car dealerships. Which isn’t surprising – both kinds of retailers operate on the thinnest of margins.
When it comes to making a profit selling high-tech gadgets, retailers like Best Buy have discovered something that really seems to sell well these days. At a higher profit margin than high tech gadgets. They like to sell you a kind of a guarantee against obsolescence. Best Buy for instance, calls its plan, Future Proof Your Technology. The plan is, that if you subscribe to the deal, after several months, when the product you buy seems to have lost its technological edge or been superseded by another model, the store will buy the product back from you at a specified price. It’s supposed to make people feel good about not having to throw away a perfectly good gadget just because it’s been rendered obsolete. The electronics stores feel that a plan like this can help sell more high-tech gadgets as it psychologically makes consumers feel more confident about buying right now. All stores need to do is to sign up a few suckers. It’ll do their bottom line a lot of good.
For people who love having the latest toy at all times, on the surface, the deal seems to make a lot of sense. You pay $800 for the latest laptop today and subscribe, for $75 extra, to a buyback plan that promises you that in a year, you can bring it back and you’ll be given a voucher for $300 on your next laptop.
Let’s go over why this is a bad idea. To begin with, you pay sales tax three times on the same purchase. When you return your product a year later as a part of your buyback deal, they test it to see if it’s in good condition. If they decide that it isn’t in great condition, they give you less money or nothing at all back. And oh, did you remember to read the fine print that says that you don’t get anything back if you don’t bring the receipt or if they decide that your device isn’t in good condition? Does anyone know what the appeals process is?
Not to forget, that you only get store credit (and not cash) when you bring your high tech gadgets back. Now that is it real trick; they’re locking you into buying from them forever and tricking you into never exercising your rights to shop around. You could work around this problem by going to a third-party buyback company like tech forward. They’ll just give you a check because they don’t have a stores to give you store credit.