Chantale and Clinton Call for Service

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cost that is the cost the customer pays to keep the product in good conditions for longer period. The Rileys have decided to go for the extended warranty that is an extra cost, however as the technician that visited for the broken dishwasher mentioned, The Canadian have been deteriorating on the extent of services they cover in their warranties. Also the discrepancy seen from different technicians for reimbursement of the cost of food that had to be disposed due to faulty product shows the decline in the level of customer service provided by the seller, which can be bundled under maintenance cost. Additionally all the time that Clinton spent on the phone with different representatives from The Canadian is a form of Negotiation Cost. Specifically the time that Clinton spent negotiating the delivery of a small refrigerator to the house as an alternative solution to the delay in the maintenance.

Going through all these costs it is safe to say it all happened due to buying the new refrigerator from The Canadian and going with their private brand. This means Ownership Costs may have been avoided by going to a different department store or switching to the other brands on the families short list such as Frigidaire.

In conclusion, the consequence of all these costs will destructively affect the royalty of Clinton and Chantale to The Canadian. The family will not revisit this department store for the renewal of their aging appliances anymore and even the tension created may force them to go with different maintenance companies rather than using their extended warranty with The Canadian. Therefore costs are outweighing the benefits in this case which means Rileys will go with alternative options to create value for themselves. Also the negative word of mouth shows its influence on other potential clients such as Dorothy, Rileys neighbor, and the office she works for. As Jef I. Richards said, “While it may be true that the best advertising is word-of-mouth, never lose sight of the fact it also can be the worst advertising.”

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