By Joe Palumbo
There are those of us, and I hope many, who still remember the days when you actually had to get up and change the channel on a TV. A TV (especially color) was not an inexpensive item. My very first color TV back in 1972 cost close to $600, and that was just a 19-inch RCA.
As time passed, prices began to decline and today you can get a 19-inch color TV for less than $100. With that in mind, does it pay to fix a broken TV anymore? I began to think of my old TV repairman, Carlos Zamora. I wondered how he was weathering this present-day dilemma, so I stopped off at his repair shop, Carlos’ Electronics & Repairs, in Corona.
Here’s what Zamora had to say. Today’s market for a 24-inch color TV (the highest sale model) maintains an average cost of less than $200, with the 19-inch models going for less than $100. The life expectancy is an approximate two to three years. When the unit finally does break, the cost of repair can run from $75 to $150.
Where the problem exists is that it no longer pays to fix the unit. For another $100 you can go out and buy a new one with updated features.
VCRs, on the other hand, cost $50 to $70, for an average machine. The cost of repair is a minimum $25 to $50. So, why would you fix it when you can get a new one for about the same price?
The only hope for the TV-repair business is the very large projection TVs and new digital models, which, unlike the small models, are not considered throw-away items, Zamora said. These models remain higher priced and a $150 repair is still considered quite acceptable.
The problem is that there is a limited amount of digital TV sales due to the high cost. Even after someone buys one, repairmen and repairwomen still have to wait for them to break in order to get business, and the wait may be longer than expected since most come with warranties of up to five years.
Business is at a terrible slowdown, according to Zamora, who added that the TV and electronic repair shop is an endangered species. With anticipated higher rising costs and the continued sharp decline in revenue, this repair industry will disappear in the near future.
Zamora is one of the lucky ones because he owns the building where his shop is, he said. What about those who do not, and must experience continued incremental higher costs in the form of rent increases? So how’s business? With most TVs becoming throw-away items and the VCR about to replicate the dinosaur, I can only say, not too good, my friend, not to good.
Joe Palumbo is a private asset manager as well as the fund manager for The Palco Group, Inc. an investment company at www.palcogroup.com or 461-8317.
