Good Warranty Is Key To Success

That's something systems builders have to keep in mind as they plug ahead in the white-box space.

One of the biggest problems faced by builders is a lack of faith in the white-box concept,often the result of a customer's bad experience with a builder that wouldn't stand behind its products, said Jason Windsor, co-owner of Dreamachine, Everett, Wash.

"I have customers who get burned once by others on support and will never want another white box again," said Windsor. "Of course, it works both ways. Some people who get burned by Compaq or Dell won't buy from them again, either."

The ability to offer solid warranties for white-box servers and desktops, and to make sure they are serviced adequately after the deal is done, depends on where components are sourced, said solution providers. Systems builders must rely on the right vendors and well-known suppliers, they said.

Purchasing components from authorized distributors allows white-box builders to include good warranties with their systems. Intel and AMD processors and motherboards, for example, come with three-year manufacturer warranties. So do monitors. Other components have even longer warranties.

And working with authorized sourcing channels has another benefit: The customer is covered even if the builder goes out of business.

"We buy through distributors, so our clients get the full warranty," said Brad Cole, CEO of Cole Computer, Oklahoma City. "We don't have to be in business for support. Customers can go directly to the manufacturer to get replacements."

For customers who have moved out of the region served by All Computer Solutions, a white-box builder in Petaluma, Calif., Ron Kramer, vice president and COO, said he works with Ingram Micro's VentureTech or similar organizations to put those customers in touch with like-minded systems builders for service.

Stephen Monteros, general manager of GST, a Cerritos, Calif., systems builder, offers a standard 12-month warranty on white boxes, and sells three-year and five-year warranties backed by third-party insurance companies.

"If, heaven forbid, we go out of business, the customer is still covered. A lot of white-box builders don't factor the cost of technicians and parts into their service offerings, offer a three-year warranty because that's what everybody does, and then go out of business," he said.