Traditionally, spare parts and services have been an afterthought for manufacturers. The main driver of revenue is product sales, and aftermarket is used as a tool to bolster those sales.

Author Nick Saraev

Photo: Freepik

This mindset leads to small budgets and limited support for service teams attempting to make a change. Without the support of the organization at large, how can your team make a difference? 

Marco Mambretti from Cavotec shared his team’s strategy for boosting service revenue. His team focused on using the resources they already had at their disposal and connecting with customers where they were. 

By mobilizing their technicians and engaging with their installed base, they were able to transform service from an afterthought to a major revenue leader. 

Creating a Cultural Shift

Cavotec is an entrepreneurial business with a major focus on customising its products to fit the needs of the customer. While this has been instrumental to their success as a whole, it makes spare parts a difficult task. There isn’t much standardization, so the parts catalogue is vast and varied. 

To give the spare parts department a fighting chance, they had to shift their approach from product-centric to service-oriented. This involved several specific pushes.  

  • Belonging to an Ecosystem – Your company as a whole exists in relationships with other businesses, and internally the spare parts team is in relationships with other departments
  • Persuasion and Persistency – It will take time to get traction for your initiative, but if you stay consistent you will see progress
  • Earn the Right to Play – There will likely be quite a bit of pushback when you propose this major cultural shift, but when you show the benefits, you can make headway 

By keeping these values at the forefront, you can change the direction of even the most product-centric manufacturing companies. And this shift is imperative. The margins for aftermarket are significantly larger than those for products, and bolstering sales can transform your company’s bottom line entirely. 

Skillset Enhancement 

Generally speaking, even the most effective technicians have limits to their skills and capacity. This leads to experts getting into the field, fixing the problem they were called for, and leaving. 

While solving the issue at hand is key to success, a service contract requires your technicians to go above and beyond. They can make the most out of every call by examining an entire fleet and finding room for improvement. 

  • Commercial Awareness – What questions should be asked when meeting with a customer
  • Lead Generation – Incentivize your technicians to bring in leads and make orders come in 
  • Asset Tracking – Technicians have eyes on your installed base around the world and can help compile data and information about the effectiveness of this equipment 

Bringing your technicians into the fight for spare parts management will help you get more results for less cost. You are using the resources already available to your team to make an impact. 

Customer Expectations and Communication 

Customer-centricity has become a major focus for B2B manufacturers around the world. Rather than thinking about what you can offer, take time to discover what your customers need. This could be anything, including 

  • Availability 
  • Reactiveness
  • Proximity 
  • Maintenance Manual 
  • Uptime 
  • Troubleshooting 
  • Speed
  • Backup 
  • Leadtime  

Cavotec took time to sit down with their customers and ask what they needed. One client had ordered a product but didn’t know exactly how to operate it. By listening to their needs, Cavotec secured an operations and maintenance contract rather than a simple SLA. 

Best Practices to Utilize Your Installed Base

When Mambretti started working on spare parts for Cavotec, he went to speak directly with a major customer. The goal of the trip was to stimulate the sales of spare parts, as this client hadn’t bought many spare parts over the last decade. Upon arriving, he tried to convince the client that a maintenance inspection would be valuable. 

This pitch was met with confusion, as the client had been working with Cavotec’s products for over a decade and believed they knew all there was to know. However, after walking through the installed base, getting a closer look, and finding specific issues that could be solved, Mambretti got a sale.  

The inspection ended with a maintenance checklist, and some suggested spare parts. This single inspection led to roughly $500k worth of spare parts being sold. It was made possible by engaging with customers, examining the installed base, and finding specific ways to maximise output for the client. 

After this success, the spare parts team at Cavotec planned to repeat it with other clients. They found several tips to make the process effective. 

Tip One: Don’t Boil The Ocean 

While it may be tempting to go all in with tools and initiatives for tracking your installed base, it’s far more effective to focus on getting small wins first. Look at the data you already have on hand, and train your technicians to spot areas for upselling while on the job. These simple changes can give you the information you need to give clients what they want. 

Tip Two: Build a Support Structure

Traditionally, maintenance is sold by the same team that sells equipment. This leads to the idea that maintenance and spare parts are an afterthought or add-on, rather than a viable business opportunity. 

Create a dedicated sales force that can specialize in turning data from your installed base into tailor-made sales pitches for your existing clients. 

Tip Three: Find a Scalable Approach

As you work to create a strategy and plan, make sure you take note of what is working. The ultimate goal should be to replicate the strategy in other markets going forward, baking service and spare parts contracts into the way you engage with all your clients. 

Tip Four: Get Proactive 

Mambretti went to the technicians who had been working with Cavotec for a long time and asked them to compile data about the areas that had the largest installed base. This information gave them a starting point for proactive spare parts sales.   

Rather than waiting for a breakdown or problem, they could anticipate issues and show value to clients who had the most to gain from a service contract. 

In Conclusion

When expanding your aftermarket support system, it’s important to remember that your best assets are already in place. Field service technicians can become your biggest lead generators because they are out in the field, interacting with customers and seeing exactly what they need. 

Taking a customer-centric approach and listening to your customers lets you pinpoint the things that matter to them, and gives you a huge leg up when convincing them to work with you.  

Ultimately, to build a service strategy that lasts, you need to be proactive. Reach out to customers, engage with the resources you have in place, and get ready to change the way your user base sees maintenance.

How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0