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Old Sep 30, 2006, 8:54 PM   #1
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Do you think this is what happens?

When a new camera comes into the market, the retail price is highest, because the product is new and fresh from the manufacturer. Most of these are sold through authorized dealers, so the manufacturer makes most of the profit.

A certain percentage of products sold have defects. If these defects are noted immediately after the purchase, the customer most likely send it back for an exchange. If the defects occur later (say three months after purchase), it will be sent in for repair.

The circumstance I am talking about is the less stringent quality control of modern digital camera manufacturing, with "minor" defects such as "bad" pixels (stuck, dead or hot) either on the CCD sensor or on the LCD screen. In fact this problem does not happen in digital cameras - you may also have heard about this alot on large screen TVs etc. Many people are noticing these "minor" problems surface soon after purchase, but increasing more people are noticing these on brand new items bought from the stores.

No one likes having ANY bad pixels on the LCD screen of the camera, or worse, on the CCD (because now the pictures are ruined): to the customers, this IS a _HUGE_ problem.

Not to the manufacturer though, that is why I call this a "minor" problem, to them that is. Let me explain ....

When the product is returned for an exchange/ replacement because of operational problems, the item is returned to the manufacturer from the retailer. What the manufacturer does is to check the item for cosmetic damages and BASIC operation - which, I guess, usually involves switching on and off the camera, taking a few pictures, and viewing them on the camera's little LCD screen. As long as any of these functions work, they pass the test. They are re-packaged (maybe in the original "new box" condition), and re-sold as "refurbished" items.

What happens is that the "minor" defects like bad pixels in LCD screen and CCD will "pass the test", because they are not "major" defects like the screen goes black, or zoom is stuck, or pictures cannot write to the memory card etc. To the manufacturer, as long as the customer can switch on the camera and take pictures with no detectable defects (on the little LCD screen, that is), it meets the criteria of "basic" operation, and the product can be sold again.

This "refurb" stock is released into the market again. I do not know the sales practice but I suspect that they are now sold not only to authorized dealers but to every seller.

Of course, by now the item is not "red hot" in the market, and by nature it is a "refurb", so the manufacturer sells these at a much lower price than the original brand new items. This way the sellers can still make profit at a lower retail price.

I suspect this is where a lot of internet sellers (anonymous web stores with no street address; eBay sellers etc.) got their stock. They never have the obligation to tell the customer that these are "refurbs" (or they lie when asked by email or phone calls). The item will arrive in pristine package condition, and no one will ever suspect. That is, until the customer notice these "minor" defects.

When the customer ask for an exchange, there is a good chance they end up with one with the exact problem.

A HIDDEN factor that helps the manufacturer is that, if the internet seller that buy the refurb stock is from a different country altogether, the manufacturer can refuse honoring the warranty.

Some reputable internet stores or outlets do sell refurbs, but they are more likely to state the nature of the item on their website.

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I think the core is a problem with modern manufacturing and sales practice -

To keep the price low and the profit high, manufacturers tolerate lesser quality control, allowing more products with "minor" defects to go into the market.

They would re-circulate these items with "minor" defects as "refurbs", to continue pushing the stock of products out of the factory, so as to maximize profit: remember, it ALWAYS cost them more to fix the items because of additional labor cost. If it works (at a basic operational level), it goes out. This is where the anonymous internet sellers are a big help nowadays (internet sales is a far bigger phenomenon than the "mail order" sales in the old days!)

But hey, this is the modern world - a television set or washing machine is not built to last fifteen or twenty years anymore. The average expected lifespan of major manufactured goods is only 2-5 years (more like the former). That is, before they are replaced and thrown out, not because they break down. Products are much cheaper and consumers are expected to spend spend spend.

This is why I believe that, if you can afford the higher retail price, you should buy a brand new item hot in the market from an authorized dealer or a reputable store. You are not guaranteed to get a brand new item without ANY manufacturing defects, but at least there is a good chance you exchange for one without defect, because the stock is still plentiful.

When you buy from internet sellers, you are taking a chance that the item may have minor defects, even with exchange/ replacement. If it turns out to be a grey market product, the manufacturer may even turn down your warranty claim.

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This is what I suspect:

A new product goes on the market in Asia (like Japan) before they are available in America. Sales go through the roof. A certain percentage of items (which is in large number, because of heavy sales) got returned to the manufacturer with "minor" defects. They are released as "refurbs" and got sucked up by the internet "grey market" sellers.

This is why you see some American internet sellers already selling these items - "brand new" in America because it isn't available in our market yet, but already not "red hot" in the Japan market - on eBay etc. at a sonewhat discount price. I am not saying all eBay sellers are dishonest: many do get hold of the new stock in Asia and they are genuinely new, and they are listed as "grey market" items. However, there are always bad apples - I do suspect some of them make huge profit this way, by selling refurb stock from Asia, at or close to new MSRP (in America that is). This is where you may run into problems with minor defects etc.
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Old Sep 30, 2006, 9:26 PM   #2
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If it turns out to be a grey market product, the manufacturer may even turn down your warranty claim.
Now this where I'm kind of surprised ... why would a manufacturer void a grey market product? Didn't they manufacture it in the same way? Didn't they have it go through QC? It's their product manufactured to the same standards as non-grey market products so what's the problem? Dealer or agent protection? Monopoly?
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Old Sep 30, 2006, 10:12 PM   #3
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Hmm .... I think I should say that the local (American) manufacturer would void the warranty - remember even though they are branches of the same mother company, each company is in a different country, and are subjected to different regulations (eg. import/ export), liability and laws. You have to track down where the item originated from (eg. Japan), and then send it back to them and persuade them to repair it. Problem is, you may run into problem if you bought from eBay or web stores that have no physicial address etc. and are not considered "retailers" (ie. the manufacturer consider these iitems are re-sold in private sales). Also not to talk about communication / language problems etc. I guess you are probably just going to be ignored.

I bought from a web store before that sells items which are not officially released in the American market (ie. "grey market" in essence). This is an honest trader who has a street address, and states that their items are not covered by local (American) warranty, and if there are problems within the warranty period, the customer should send it back to them, and they will send it, with postal cost, to the original local manufacturer (in Japan) for repair. I never had any problem with my camera before I sold it, but at least I feel more reassured this way.
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Old Oct 1, 2006, 11:32 AM   #4
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blindsight wrote:
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Do you think this is what happens?

[snip]
No, I don't think so. I think that most manufacturers are more thorough than just turning it on and making sure it can take pics.

I see less problems reported from purchasers of refurbished cameras than I see from purchasers of new in the box cameras.

Also, most manufacturers clearly mark refurbursihed cameras as being refurbished (or "factory reconditioned"), and you have some warranty differences, too (most refurbished cameras only carry a 90 day warranty).

Just make sure you are buying a genuine "factory reconditioned" camera versus one a less scrupulous dealer may be trying to pass off as being refurbished.

In most cases, I doubt the cameras are even defective. The customer probably just changed their mind, or didn't know how to use it.

As for stuck pixels, the manufacturers have software that maps them out. Virtually all CCDs will have them in some conditions, and the ones that would show up at typical (versus slower shutter speeds where the dark frame subtraction noise reduction would find them) have already been mapped out at the factory via a bad pixel map that the cameras have in EEPROM. I think that it's likely that any product that is reconditioned by the factory would be checked with the manufacturer's service software for things like bad pixels and AF accuracy.


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Old Oct 1, 2006, 11:44 AM   #5
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belgian pie wrote:
Quote:
Quote:
If it turns out to be a grey market product, the manufacturer may even turn down your warranty claim.
Now this where I'm kind of surprised ... why would a manufacturer void a grey market product? Didn't they manufacture it in the same way? Didn't they have it go through QC? It's their product manufactured to the same standards as non-grey market products so what's the problem? Dealer or agent protection? Monopoly?
Buy from a reputable dealer. ;-)

Make sure you're buying gear with a Nikon USA warranty if you want to be able to get it serviced by Nikon here.

Nikon USA will refuse to service gear that was not intended for sale in the U.S., even if you are willing to pay them to do it. Nikon has similar policies in some of the other regions, too (for example, Nikon Canada has the same policy).

I'd also make sure to read the "fine print" carefully if buying from an Ebay vendor (or any other vendor for that matter).

A number of discounters sell gray market cameras, often with misleading warranty decriptions (for example: one year US warranty, which may be a store warranty versus a Nikon USA warranty).

Now, some Ebay vendors sell Nikon gear that' s intended for sale in the U.S.

For example, CametaAuctions is a reputable Ebay vendor (they sell only Nikon cameras intended for sale in the U.S.). They have both new and factory refurbished gear for sale on Ebay.

The regional distributors (Nikon USA, Nikon Canada, Nikon Europe, etc.) are setup as their own profit center. So, when you bypass the distribution network, they don't make any money on the sale. There can also be some differences in software ans accessories sold between regions.

You may find the same issues with other manufacturers. Canon has been known to "bend" their rules on gray market lenses and service them. But, not necessarily for camera bodies.

When you buy gray market gear, you're bypassing the authorized distribution network, and it's not fair to the distributors or authorized dealers. So, manufacturers often refuse to service this gear outside of the region it's intended for sale in to help discourage this practice.

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Old Oct 1, 2006, 12:04 PM   #6
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Not to the manufacturer though, that is why I call this a "minor" problem, to them that is. Let me explain ....

When the product is returned for an exchange/ replacement because of operational problems, the item is returned to the manufacturer from the retailer. What the manufacturer does is to check the item for cosmetic damages and BASIC operation - which, I guess, usually involves switching on and off the camera, taking a few pictures, and viewing them on the camera's little LCD screen. As long as any of these functions work, they pass the test. They are re-packaged (maybe in the original "new box" condition), and re-sold as "refurbished" items.

What happens is that the "minor" defects like bad pixels in LCD screen and CCD will "pass the test", because they are not "major" defects like the screen goes black, or zoom is stuck, or pictures cannot write to the memory card etc. To the manufacturer, as long as the customer can switch on the camera and take pictures with no detectable defects (on the little LCD screen, that is), it meets the criteria of "basic" operation, and the product can be sold again.

Now, that is a really "Stupid" way of doing thingsin my opinion. What a "Hopeless" way of checking a camera!!

Iwill never buy a camera from such a lousy dealer.

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Old Oct 1, 2006, 1:37 PM   #7
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I think you are way off base on this one. Reputable dealers clearly state when an item is refurbished, and as JimC said, it is clearly state on the box. I have bought several refurbed cameras with no issues.

Manufacturers have too much at stake to play these sort of games, and your theory depends on too many ifs and assumes that manufacturers are just plain dishonest and aren't conerned about the quality of product they produce. They simply could not survive in a competitive marketplace if they willingly and knowingly put bad products on the market.
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Old Oct 1, 2006, 7:08 PM   #8
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In general, when a camera is returned for a problem, the MFR issues a RA#. This RA file contains the complaint for which it was returned, and it will be quite stringently inspected for this problem, and function checks performed before being released.

I would have more confidence in a factory reconditioned camera than in a new one.

The economics of manufacturing vs. repairing anything means that returned products cost the manufacturer more, but the consumer less. Go figure.

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Old Oct 2, 2006, 12:19 AM   #9
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i think it would be treated like an 'in house' quality control issue
naturally cameras are checked for functionality as they come off the production line
sample cameras are taken for more stringent tests. Cameras that fail are rebuilt, recalls in batches would likely be scrapped. It not being economicly feasable to repair them.

reputable manufacturers would be concerned that the product meets set standards
to avoid issues like entire batches of cameras being returned either because of a fault found later or because they dont pass a countries laws on quality. Recently the latter has occurred to two manufacturers in china of all places.

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Old Oct 2, 2006, 12:28 AM   #10
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I bought a factory reconditoned Nikon about 5 years ago that you could not distinquish from a brand new camera from a cosmetics and functionality perspective.

It was in perfect condition, as were the included manuals and software.

I think it probably was new, and they decided to sell some of them as factory reconditioned with a 90 day versus 1 year warranty to keep the dealers with existing stock from complaining about the lower price. :-)

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