Warranty Reserve

3 Months Ended

Mar. 31, 2015

Warranty Reserve. We generally do not independently provide warranties on the products that we sell. Instead, in almost all cases, the manufacturers of the products that we sell warrant the products and allow us to return defective products, including those that have been returned to us by our customers. However, we sell a line of portable generators under a product supply arrangement which obligates us to provide warranty services for these products and to share the costs of providing those services with the manufacturer. We maintain a reserve for warranty claims against which the warranty costs we incur are charged. We replenish or make additions to the reserve from time to time, based primarily on our warranty claims experience and the volume of generators that we sell, by a provision we make for warranty claims, recorded as a component of costs of products sold, in the condensed consolidated statements of operations.

The following table sets forth, in thousands, the accrued warranty expense that is included in accrued liabilities on the condensed consolidated balance sheets as of March 31, 2015 and 2014:


	2015			2014
Accrued warranty balance – January 1,	$	762		$	737
Warranty costs incurred		(245	)		(253	)
Provision for warranty		237			225

Accrued warranty balance – March 31,	$	754		$	709